|
2023-TIOL-101-SC-CUS
Senior Intelligence Officer Vs Sanjay Agarwal
Cus - Revenue/DRI is in appeal against order dated 29 July 2022 [ 2023-TIOL-784-HC-TELANGANA-CUS ] of Telangana High Court - Respondent has chosen not to remain present - ASG of India, who was to argue this matter has been held up in some other Court.
Held: Following questions of law fall for consideration of the Apex Court viz. Whether a DRI Officer is a "proper officer" for the purposes of Section 28 of the Customs Act, 1962?; Whether the summons issued by the DRI Officer to the respondent under Section 108 of the Customs Act, 1962 could be said to be without jurisdiction?; Whether the Customs/DRI Officers are police officers and, therefore, are required to register FIR in respect of an offence under Sections 133 to 135 respectively of the Customs Act, 1962?; Whether the provisions of Sections 154 to 157 respectively and 173(2) of the Code of Criminal Procedure, 1973 would apply in respect of the proceedings under the Customs Act, 1962, in view of Section 4(2) of the Code and whether in respect of the offences under Section 133 to 135 respectively of the Customs Act, 1962, the registration of the FIR is mandatory before the person concerned is arrested and produced before the Magistrate? - Matter to come up for final disposal on 19 July 2023: Supreme Court -
Matter posted
: SUPREME COURT OF INDIA 2023-TIOL-784-HC-TELANGANA-CUS
DRI Vs Sanjay Agarwal
Cus - Foreign Trade Policy (Advance Procurement Scheme) -With a request to quash the order dated 09.03.2022 that is passed by the Court of Metropolitan Sessions Judge, Hyderabad and thereby direct the authorities concerned to produce the respondent for custodial interrogation, the present petition is filed by Directorate of Revenue Intelligence - Case is that SGJ diverted and sold the duty-free gold bullion in the domestic market with the active involvement of the respondent herein and his son Preet Agarwal and made huge profits - To cover up the said diversion, SGJ resorted to fabrication of export documents - Metropolitan Sessions Judge dismissed the application and disallowed the request of the petitioner for custodial interrogation on two grounds - Firstly, that it does not entertain the jurisdiction to deal with the offences under the Customs Act, and secondly, the petitioner could not make out valid and sufficient grounds to permit the Directorate of Revenue Intelligence officials to record the statement of the respondent.
Held: It is clear that in terms of s.108 of the Customs Act, 1962, the Gazetted Officer of customs shall have power to summon any person whose attendance he considers necessary either to give evidence or to produce a document or any other thing in any inquiry - That does not mean that power is vested upon the Officer of customs to collect information, which would otherwise be termed as incriminating material from the person against whom accusation is made - A person cannot be deprived of his life or personal liberty, except according to procedure established by law as per Article 21 of the Constitution of India - Article 20(3) says that no person accused of any offence shall be compelled to be a witness against himself - Though not it can be termed that examining the person against whom accusation is made as a witness, the police or the other officials who are investigating a case cannot be permitted to compel a person against whom accusation is made to make a statement either inculpatory or exculpatory - It is the duty of the Investigating Agency under whatever cadre it may be to investigate the case and to cull out the truth - The person against whom accusation is made cannot be compelled to make a statement against himself - Furthermore, no other ground is urged as to the dire requirement of said interrogation or for recording the statement of the respondent against whom accusation is made - Permission cannot be accorded for interrogating him only for the purpose of recording his statement for proceeding with the investigation - Court does not find any other grounds, more so justifiable grounds, to accord such permission - Criminal petition is dismissed: High Court [para 8 to 10]
-
Petition dismissed
: TELANGANA
HIGH COURT 2023-TIOL-591-CESTAT-MUM
Creative Newtech Ltd Vs CC
Cus - Appellant has claimed the benefit of notfn 12/2012-Cus for imports effected against bills of entry filed before 1st July 2017 and notfn. 50/2017-Cus thereafter - The eligibility for notification is, first and foremost, claim of classification within description corresponding to tariff item 8525 8020 of First Schedule to Customs Tariff Act, 1975 and, thereafter, to conformity with 'digital still image video camera' describing the article to which exemption may be allowed - In the absence of a finding in impugned order that could, possibly, place impugned goods within such general, and residual, description of 'others', the responsibility of customs authorities to initiate rejection of a declared classification has not been fulfilled - The declared classification, against tariff item 8525 8020 of First Schedule to Customs Tariff Act, 1975, cannot be substituted in these circumstances - There is nothing on record to indicate that imported goods do not conform to description that entitles them to benefit of exemption in impugned notification - The rescinding of Explanation therein has done away with any technical specification that may, at some in past, have served to segregate 'digital still image video camera' as eligible and ineligible for exemption - The confirmation of demand under section 28 of Customs Act, 1962, therefore, has no basis in law - The confiscation under section 111(m) of Customs Act, 1962 in impugned order is vacated along with consequential redemption fine, if any, as well as any penalties under sections 112, 114A and 114AA of Customs Act, 1962 - Consequently, impugned order is set aside: CESTAT
- Appeals allowed: MUMBAI CESTAT
2023-TIOL-590-CESTAT-DEL
CCE & CGST Vs Navdeep Traders
ST - The original adjudicating authority has confirmed proposal of SCN by holding that activity of assessee is blasting services against consideration, hence are taxable in terms of provisions of section 65 B (44) of Finance Act, 1994 - The very basis of those findings is assessee's own admission that they are not selling explosives to their customers while blasting at customers' site - Also for the reason that explosives issued for blasting was fully consumed while providing the blasting services - However, Commissioner (A) has dropped the demand holding that activity of assessee is a works contract service though chargeable to tax under section 65B (44) of Finance Act, 1994 but value for material as has already been assessed for purposes of VAT cannot be considered as value for assessing service tax liability - Similar issue has been dealt by Apex Court, the 3 Judge Bench in case of Larsen and Toubro 2013-TIOL-46-SC-CT-LB wherein the 46th Amendment of 1982 has been appreciated to have widened the concept of sale or purchase of goods that would be eligible to tax by introducing the fiction of a deemed sale to the transactions covered specifically by sub-clauses (a) to (f) to sub-article 29A of said Article - Undisputedly, assessee was purchasing explosives from authorized seller under a license for being used for blasting purposes at customer's site - Though assessee was not selling explosive to mine blaster and was issuing the same for execution of mining works but there is no simultaneous denial to the fact that assessee was issuing bills to customer in which they were charging for explosive material and blasting service separately and that assessee was paying applicable VAT on explosive material - Dominant intention test to ascertain factum of sale no more holds a good law - These facts are sufficient to have no reason to differ from following finding of Commissioner (A) in order under challenge - No infirmity found with order of Commissioner (A), same is hereby upheld: CESTAT
- Appeal dismissed: DELHI CESTAT
2023-TIOL-589-CESTAT-MAD
M Pandidurai Vs CGST & CE
ST - The main contention put forward by appellant is that the adjudication order has been passed exparte and that SCN has not been served upon appellant - The registration certificate of appellant has been adverted to by appellant wherein the address is of "Tiruchirappalli" - However, department has issued SCN at the address of Trichy - It is stated in opening paragraph of SCN that this was the address in which appellant was previously residing - Department was fully aware that appellant is not residing and not available on said address - Even then SCN has been issued to said address by department - After the SCN was returned as unclaimed, department has not opted to issue SCN to the proper address and instead has followed the procedure under sec. 37C(b) of Central Excise Act r/w sec. 83 of Finance Act, 1994 to paste and affix the SCN at Trichy address - Appellant has not been served intimations for personal hearing and the order is seen to have passed exparte - SCN was not issued to appellant and also that the order has been passed exparte - Clear violation of principles of natural justice is established - Demand cannot sustain, same is set aside: CESTAT
- Appeal allowed: CHENNAI CESTAT
2023-TIOL-588-CESTAT-KOL
Jai Balaji Industries Ltd Vs CCE
CX - The Appellant is engaged in the manufacture of various iron and steel products falling under Tariff Heading No. 7202 of the 1st Schedule to the Central Excise Tariff Act, 1985. - They availed cenvat credit during the months of May, 2003 to June, 2008 on capital goods such as pollution control equipment, Mechanical Appliances such as vibrating screen, coal crusher, Mill Roll table & its equipments, Control panel, electrical motors etc which were procured from M/s. Ashok Electrical Stampings (P) Ltd. Rajarhat Road, Jagerdauga P.O. Rajarhat Gopalpur, 24 Parganas (North) Kolkata (hereinafter referred to as M/s. AESPL) on the strength of 199 invoices - The case of the Revenue is that M/s. AESPL did not have the necessary infrastructural set up at their factory premises either to carry out the manufacturing process, given the nature of their purported finished goods, supposed to involve sizeable service of man & machinery or to have undertaken such a magnitude of recorded production and clearance - on the basis of various evidences a show cause notice dated 04-12-2008 was issued to the Appellant wherein it was alleged that the entire transaction was conducted with M/s. AESPL was on paper only with an ulterior motive of availing wrong and irregular Cenvat credit without accompaniment of any physical material said to be manufactured by the said M/s. AESPL - It was alleged that the Appellant had willfully and deliberately indulged in suppression of material fact from the department of non-receipt of Capital Goods namely machine & mechanical appliances from the so called manufacturer-supplier, M/s. AESPL, who had actually never manufactured or supplied the same as was evident from the detailed investigations carried out by their concerned jurisdictional i.e HQ A/E Unit of Kolkata-II Commissionerate - It was alleged that the Appellant had deliberately availed wrong and irregular Cenvat Credit amounting to Rs. 3,07,48,020/- being the amount of CE duty on the so called received inputs, which were not manufactured and cleared from the factory of the said supplier M/s. AESPL in as much as the amount shown to have been paid as duty of excise without undertaking any manufacturing activity could not be construed as "duty of excise" leviable under Central Excise Act as envisaged in Rule 3 of the said CCR '02/'04, and hence not eligible for Cenvat credit - There was also a proposal to impose penalties and demand of interest - The Commissioner of Central Excise, Bolpur vide Order-in-Original No. 115/Commr/Bol/2009 dated 31-12-2009 had confirmed duty demand of Rs. 3,07,48,020/- and had imposed equal amount of penalty - A separate penalty of Rs. 50,000/- was imposed under Rule 13(1) of Cenvat Credit Rules, 2002. - The period involved is from May 2003 to June 2008 and the SCN was issued on 04-122008 under extended period of limitation.
Held - Hence the demand raised is sustainable neither on merits nor on limitation and so merits being set aside: CESTAT
+ the capital goods were duly cleared on the strength of the duty paid central excise invoices in which the payment of central excise duty was prominently shown. The vehicle number on which the capital goods were transported were also duly mentioned in each of the central excise invoices. The payments were made by the Appellant to M/s. AESPL through banking channels. In this regard we have gone through the party ledger account and bank statements of the Appellant pertaining to M/s. AESPL. The department did not conduct any inquiries from the transporters to substantiate their allegation that the goods were never manufactured by M/s. AESPL and never supplied to the Appellant. We are of the firm view that the transporter is an important and independent link as without the participation of the transporter the goods cannot be transported from the factory of the supplier to the factory of the recipient. Further there is no evidence that there was any flow back of cash from M/s. AESPL to the Appellant. No statement from the director of M/s. AESPL was recorded with regard to the supplies of capital goods to the Appellant. Further two statements of Shri Niranjan Gourisaria, Senior General Manager of the Appellant dated 21-08-2008 and 28-11-2008 as well as statement of Shri Umesh Rai, Project Manager of the Appellant dated 28-11-2008 were recorded by the department. Nowhere they have stated in their respective statements that the capital goods were not received from M/s. AESPL. The Appellant in para 1(i) of their written submissions filed at the time of personal hearing had contended that the said capital goods had been installed in their plant and almost all existed and still in use in their factory in the manufacture of dutiable final products. This stand of the Appellant has not been rebutted or controvered by the adjudicating authority. We have held in the earlier portion of the order that this fact was required to be investigated by the department at the investigation stage itself. Keeping in view of all these submissions we are of the firm view that there is no material on record to show that M/s. AESPL did not supply capital goods to the Appellant as alleged in the show cause notice and held in the impugned order;
+ The next question would be as to the demand of duty is barred by time or not. In the present case the period involved is from 20-052003 to 30-06-2008 and the show cause notice was issued on 04-122008. The majority of the duty demand is under the extended period of limitation. We find that the Tribunal in para 9.10 of their final order No. 75105/2022 dated 22-02-2022 held that where the credit was availed on the basis of invoices of a manufacturer who was duly registered with the department but could not be found subsequently it could not be said that the credit was availed on the basis of forged documents. It has been held that even if the original document was issued by the supplier of the inputs even by practicing fraud, a holder for valuable consideration unless shown to be a party to a fraud could not be proceeded with by taking aid of a larger period of limitation as indicated in Section 11A(1) of the Act. We hold that even in the present case even if the goods were not actually manufactured by M/s. AESPL the fact remained that the same were duly received by the Appellant and M/s. AESPL have duly discharged the central excise duty on the same. In such a case extended period of limitation could not be invoked against the Appellant. We agree with the Ld. Counsel that the larger period of limitation cannot be invoked after 02-03-2006 as on the said date the department had formed a belief that M/s. AESPL did not have required manufacturing capacity to manufacture capital goods which were shown to have been supplied to the Appellant.
- Appeal allowed: KOLKATA CESTAT
2023-TIOL-587-CESTAT-KOL
Sarva Mangalam Gajanan Steel Pvt Ltd Vs CCGST & CE
CX - Allegation of department is that appellant had availed Cenvat credit on TMT Cutting, Square Cobble, MRM Rolls Spoils, Misrolls & End cutting, Scrap & Melting Scrap considering them as 'inputs' used in manufacture of their final products - The Department's contention is that appellant is only a Rolling Mill and does not have furnace for melting of such waste and scrap and hence they could not have used these scrap as 'inputs' to manufacture their finished goods namely hot rolled products - The Department has not brought any evidence on record to show that these inputs purchased by appellants have not been used in their factory for manufacture of final products - Only an allegation has been made without any evidence that scrap were not used in factory as they were not capable to be used in manufacture of Billets or Ingots - Appellant stated that goods so purchased from SAIL and others have been subjected to heating, straightening to make suitable for rolling and sometimes cut to sizes and then rerolled to manufacture their final products - The rolling mill installed by them have the capacity to roll such items - Department has not adduced any evidence to counter this claim - Further, the Rerolled products, manufactured by Appellants have been cleared on payment of central excise duty - As the inputs on which credit has been availed, were used in manufacture of dutiable final products, the CENVAT credit availed on these inputs cannot be denied - Appellants are eligible for CENVAT credit availed on 'inputs' used in manufacture of their final products namely, Rerolled products, MS Flat/Bar, MS Angle, MS Channel and MS Round and hence demands made in impugned order is not sustainable - Appellant submitted that on similar issue, another SCN was already issued to them - They relied on decision of Apex Court in case of Nizam Sugar Factory 2006-TIOL-56-SC-CX , and argued that the second notice on the same issue alleging suppression is not sustainable - When a SCN was already issued and the facts are in knowledge of authorities, then another notice cannot be issued on same facts alleging suppression of facts - Thus, the Notice issued on same ground and impugned order confirming the demands made in Notice are not sustainable on the ground of limitation also - Thus, demands made in impugned orders along with demand of interest and penalties are not sustainable on merit as well as on the ground of limitation: CESTAT
- Appeals allowed: KOLKATA CESTAT |
|
