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2023-TIOL-617-CESTAT-KOL
Jindal Steel And Power Ltd Vs CCT, GST & CX
CX - Appellant is an Integrated Steel Plant to manufacture Iron and Steel with a capacity of 1.5 MT in Odisha - The issue involved is eligibility of CENVAT credit of 'input services' availed for setting up of the plant - The definition of 'input services' was amended w.e.f 1.04.2011, wherein the words 'setting up of plant' available in earlier definition has been specifically excluded - Hence, department contended that appellant was not eligible for input services credit used in setting up of plant after 1.04.2011 - However, appellant contended that definition still covers input services used for setting up of plant under 'means' part of definition - Issue has been dealt by Tribunal in case of Pepsico India Holdings Pvt. Ltd. 2021-TIOL-448-CESTAT-HYD - The subject input services used in setting up of plant have a direct nexus with manufacture of final goods - Therefore, 'input services' used in setting up of plant are covered within ambit of 'means' clause of definition of 'input service' - Accordingly, even if the word 'setting up' is specifically excluded from definition of 'input service', w.e.f. 01.04.2011, such services used in setting up of the plant would still qualify as an 'input service' as per Rule 2(l) of CCR, 2004: CESTAT
- Appeal allowed: KOLKATA CESTAT
2023-TIOL-616-CESTAT-KOL
Haldia Petrochemicals Ltd Vs CCE
CX - The issue arises for determination is, whether Residual Fuel Gas (RFG), an intermediate excisable good could be cleared without payment of duty for job work under Rule 4(5)(a) of CCR for conversion into electricity/steam and return thereof for use in manufacture of dutiable final products - Tribunal in appellant's own case had dropped the demand of duty on removal of another intermediate product i.e. 'CLS' cleared to M/s. HPLCL during period November 2000 to October 2002 under Rule 4(5)(a) of CCR for generation of steam and electricity which were received back by appellant and used in manufacture of final products - Issue involved in present case is on the same lines and the only difference is that in said case the partially processed goods was 'CLS' whereas in instant case Tribunal is concerned with 'RFG' but both 'RFG' and 'CLS' were generated on cracking of Naphtha and were sent to M/s. HPLCL for generation of electricity and steam with an intention to bring back electricity and steam for use in manufacture of final products - The Commissioner misdirected himself in observing that this Tribunal's Order was not concerning dutiability of an intermediate good - To the same effect is the decision of Tribunal in Maharashtra Aldehydes & Chemicals , wherein the duty demand on the intermediate product cleared under Rule 4(5)(a) of CCR was dropped - Since the issue is squarely covered in favour of appellant by decision of Tribunal in appellant's own case, Tribunal is inclined to allow the appeal of appellant on merits - In so far as invocation of extended period is concerned, same also does not survive in view of communications intimating the Jurisdictional Superintendent about clearance, inter alia, of 'RFG' to M/s. HPLCL for job work: CESTAT
- Appeal allowed: KOLKATA CESTAT
2023-TIOL-615-CESTAT-KOL
CST Vs Net 4 Communications
ST - Assessee is engaged in providing service under categories of "business Auxiliary Service" and "Internet Café Service" - During audit, it was revealed that they had rendered taxable services in relation to 'Online Information and Data Base Access and/or Retrieval Services' to their clients during Financial Year 2005-06 for which they did not pay Service Tax - Accordingly, a SCN was issued to assessee demanding service tax and Education Cess - Assessee has been providing 'System Networking Services' - The said service involves linking of two or more computing devices together for the purpose of sharing data - Networks are built with a mixture of computer hardware and software - The work of assessee is to undertake inter-linking of computers through installations of required software and hardware - Assessee has provided solutions to their customers based on various network models and architectures and thus they have provided service for making available telecommunication network through which data and information can reach from one place to another for the purpose of sharing data - This service will not be classifiable as 'Online Information and Data Base Access and/or Retrieval Services' liable to service tax - From the activity of assessee, it is observed that they are neither involved in generation of data or information nor involved in providing the same to their clients - They are involved in setting up the network for transfer of data not provided by them - Thus, assessee has not provided the service of 'Online Information and Data Base Access and/or Retrieval Services' to their clients - Impugned order dropping the demands holding that assessee have not rendered 'Online Information and Data Base Access and/or Retrieval Services' is sustainable: CESTAT
- Appeal rejected: KOLKATA CESTAT
2023-TIOL-614-CESTAT-KOL
Bimal Auto Agency Vs CCGST & CE
ST - The issue relates to demand of service tax on the basis of difference in ledgers of income and value shown in ST 3 for such services rendered and on incentives and other discounts received from Maruti Suzuki India Ltd (MSIL) by appellant - As regards the demand of service tax of Rs. 3,86,36,400/- it is the allegation of department that appellant had received incentives from MSIL as per terms and conditions of agreement and since they were acting on principal to principal basis, appellant was liable to pay service tax on such incentives received - Appellant contends that such incentives are in nature of trading income as the same arises out of sales of vehicles made by appellant and there is no element of service to attract service tax on the same - The Appellant also submitted that as per Dealership Agreement between MSIL and appellant, it is mandatory for dealer to promote sales of MSIL vehicles - Further, MSIL provides compensation to appellant on account of rate difference when a vehicle is sold by appellant to a customer at a lower price due to reduction in recommended sale price of MSIL after the purchase of said vehicle by appellant from MSIL - These activities cannot be stated to be any service provided by appellant to MSIL - Issue is no longer res integra and is squarely covered by judgment in case of BM Autolink 2022-TIOL-1171-CESTAT-AHM - Demand of service tax of Rs. 3,86,36,400/- cannot survive - As regards the demand of service tax on basis of difference in ledgers of income and value shown in ST 3 for such services rendered, appellant has produced CA certificate being the statutory auditor of appellant and main reason for such difference was because the department has only taken credit side of income by ignoring debit entries for reversal and hence the value as per ledger is inflated - Since there had been service tax audit conducted prior to DGGI investigation covering the period under dispute, suppression cannot be alleged by department for income reconciliation of books and ST 3 returns as no such allegation was raised during department audit - Hence, extended period of limitation also cannot be invoked to raise any demand - Thus, entire demand of service tax has to go and the order of Adjudicating authority is set aside: CESTAT
- Appeal allowed: KOLKATA CESTAT
2023-TIOL-613-CESTAT-MUM
Royale Impex Vs CC
Cus - Appeal filed against impugned order which was passed by original authority after the matter was remanded by Tribunal through Final Order - Details of calculation were provided to original authority - However, original authority has not taken into consideration the same - Appellant had made written submissions before original authority which are recorded in impugned order - As stated in impugned order, appellant had submitted before original authority that fine cannot be more than Rs. 1,91,000/- and penalty may be restricted to 5% of assessable value - Impugned order is modified to the extent that penalty is reduced from Rs. 3,10,000/- to Rs. 48,000/- under Section 112(a) of Customs Act, 1962 - No change made in redemption fine of Rs. 1,91,000/- - Appellant has already paid redemption fine and penalty at the time of clearance of goods - Impugned order is modified: CESTAT
- Appeal partly allowed: MUMBAI CESTAT
2023-TIOL-612-CESTAT-DEL
Oriental Trimex Ltd Vs CC
Cus - The Appellants imported rough marble blocks and filed 4 bills of entry during 26.07.2011 to 24.09.2013 at ICD, TKD, New Delhi - The appellant had also filed three other bills of entries for import of rough marble blocks - Rough marble blocks were restricted goods and could be imported against specific licence - According to the appellant due to financial difficulty, they could not clear the goods from the Customs and the goods remained lying un-cleared - Accordingly, SCN was issued by the Customs Department in November, 2013 proposing to confiscate the goods under Section 111(d) of the Act and penalty was also proposed under Section 112 - In response, the appellant responded by letter dated 27.11.2013 stating that although they are in trade for the last 10 years but they could not clear the imported consignment for home consumption, as they were facing acute financial crunch - Several purchase orders given by the builders/contractors were cancelled due to slow down in economy since 2009-2010 - At the relevant time, more than 10 containers were lying as such, pending clearance - Under these circumstances, due to demurrage and TSC charges etc. becomes higher than the cost of the goods, and until and unless the Shipping Lines and Concor provided them the adequate concession, it will be unviable for them to clear the goods - It was also stated that they have imported against 'Special Import Licence' issued by DGFT mentioning the licence number and the date of issue - The appellant also sent a supplementary reply mentioning the details of the import licence no., date of issue, quantity, value, validity period, etc and also prayed for a decision on merits - The Adjudicating Authority passed separate orders all dated 10.11.2014 confiscating the goods, with option to redeem on payment of redemption fine under Section 112 of the Act - The appeal to the Commr.(A) came to be dismissed. Held - It is seen from the copy of the RTI reply dated 25.01.2019, that the Revenue in terms of its notice to auction sale issued during 2014, and in spite of the appellant having sent reply dated 28.04.2014 informing pendency of their appeals, proceeded to dispose of the goods - I further find no further opportunity was given by the Customs Department by giving a fresh notice to the appellant after disposal of the appeals by the Commissioner (Appeals) - The Revenue shall disburse the amount of sale proceeds pursuant to auction sales by only adjusting the amount of penalty - No redemption fine can be adjusted - Further, the Appellant shall be entitled to interest on the auction sale proceeds from the date the amount has been received by the Customs Department, till the date of disbursal, rate of interest will be as per the Rules: CESTAT
- Appeal allowed: DELHI CESTAT |
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