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2023-TIOL-662-CESTAT-DEL
Pine Laminates Pvt Ltd Vs CCE & CGST
CX - The appellant is engaged in manufacture of Decorative Laminate/ Sheet falling under Chapter Heading No. 4823 9019 of the First Schedule to the Central Excise Tariff Act, 1985 and had filed a refund claim for Rs. 12,60,492/- on 09.01.2019 under section 11B of the Central Excise Act, 1944 - The Department issued SCN dated 13.02.2019 as the refund claim appeared to be hit by time limit prescribed under section 11B of Central Excise Act, 1944 and was therefore liable to be rejected - The appellant was eligible for subsidy as per the Rajasthan Investment Promotion Scheme whereunder they were required to deposit VAT/CST/SGST at the applicable rate with the government and in terms of the scheme, they were entitled to disbursement of subsidy which is sanctioned in Form 37B and the Challans in the Form VAT, 37B can be utilised for discharge of the VAT liability of the appellant for subsequent period - The Revenue proceeded to include such subsidy amounts in the value of the goods cleared by the appellants and demanded the differential duty - The appeal before the Tribunal was allowed vide Final Order No. A/51427 - 51514/2018 dated 27.04.2018, in favour of the appellants relying on the earlier decision of the Tribunal in the case of Shree Cement Ltd., Vs. CCE Alwar which was based on the decision in the case of Wellspun, which concluded that there is no justification for inclusion in the assessable value, the VAT amounts paid by the assessee using VAT, 37B Challans - Accordingly, the orders were set aside and the appeal was allowed with consequential relief. Held - In terms of the consequential relief granted by the Tribunal the appellant made the application for refund on 09.01.2019, which was within the period of limitation of one year from the date of the order of the Tribunal on 27.04.2018/ 04.05.2018 as per clause (ec) of Explanation B to section 11B defining the term 'relevant date' - From the reading of the above provisions, it is crystal clear that section 11B (1) prescribes the period of one year from the relevant date and the term 'relevant date' is then defined under the Explanation as given above and the relevant clause (ec) specifically provides that in case the amount is refundable as a consequence of a judgement or order of an appellate Tribunal or any Court, it is the date of such judgement, decree, order or direction - In the present case, the amount became due by virtue of the decision of the Tribunal on 27.4.2018 whereby the order including the subsidy amount in the transaction value was set aside and the appeal was allowed with consequential relief, which obviously implied that the amount so deposited by the appellant has to be refunded and therefore if the period of one year is computed from the said date, the application for refund dated 09.01.2019 was within the limitation period of one year - On this count itself the refund claim ought to have been allowed: CESTAT Held - issue whether the amount deposited by the appellant was 'under protest' - According to the appellant, the amount was deposited under protest and the audit party and the Department was already informed as is evident from the Excise Return (ER-I) for the period April 15, August 15, September 15, April 16 and November 16 and the Cenvat Credit Register, which has been referred to at the time of hearing - The authorities below have wrongly rejected the RG-23 register on the ground that it is a printout of excel sheet in which the backdating is possible and also the Excise Returns given manually are not acceptable as after 2011 there was no provision to file ER-I manually since e-filing of Central Excise Returns was made mandatory for all assesses - Having considered, the Supplementary Instructions, Chapter 13 of CBECs Excise Manual, which provides the procedure to be followed, I find that it seems to be substantially complied with as the Cenvat account do mentions that, "central excise duty debited against the amount received as State VAT subsidy under protest" - The same cannot be ignored and the appellant is entitled to the benefit of the proviso to section 11B of the Central Excise Act, 1944, which specifically says that period of limitation of one year shall not apply where duty and interest is paid under protest: CESTAT Held - We disagree with the findings in the order that the duty on VAT subsidy was last deposited on 30.11.2016 during the long span of time from March 2010 to November 2016 or thereafter, and if they had any kind of doubt to the audit they were required to submit letter of protest or to file refund claim of duty/interest/penalty deposited within the statutory period of one year provided under section 11B of the Central Excise Act, 1944, but they never exercised any option available to them under the provisions of law at any point of time and therefore the instant refund claim filed by them was well beyond the statutory period provided under section 11B of the Central Excise Act, 1944 - Hence the order-in-original merits being set aside: CESTAT
- Appeal allowed: DELHI CESTAT
2023-TIOL-661-CESTAT-MAD
Pepsico India Holdings Ltd Vs CGST & CE
CX - This is a case in which assessee had opted for benefit of exemption under Notfn 1/2011-CE to discharge duty at 1% - In year 2011, vide Union Budget, earlier exemption granted to 'fruit pulp or fruit juice-based drinks' was withdrawn and said goods were subject to duty at concessional rates exercisable at option of assessee - Although assessee had opted to pay duty on fruit pulp or fruit juice based drinks at 1% under Notfn 1/2011-CE, they had initially availed CENVAT credit - However, they have on their own reversed the amount being the proportionate CENVAT credit availed on inputs and input services on dutiable aerated waters and beverages and exempted fruit pulp or fruit juice based drinks - This has been confirmed in Range Officers verification report - They have also discharged interest on the same - As per the decision of Supreme Court in Chandrapur Magnets Pvt. Ltd. 2002-TIOL-41-SC-CX , once the assessee has reversed ineligible credit, claim for exemption of duty on disputed goods cannot be denied and they are hence eligible to discharge duty at 1% as per Notfn 1/2011-CE - Assessee was eligible for payment of effective rate of duty of 1% on 'fruit pulp or fruit juice based drinks' cleared by them, during impugned period, by availing exemption under Notfn 1/2011-CE - Since the matter has been decided on merits in favour of assessee, issue relating to interest and penalty does not survive: CESTAT
- Appeal allowed: CHENNAI CESTAT
2023-TIOL-660-CESTAT-CHD
Lakshay International Pvt Ltd Vs CCE
ST - The appellants are engaged in manufacture and exports of leather tool bags and polyester bags - Both the appellants have been paying overseas commission at an agreed percentage of business generated by them to their overseas commission agents who helped them to find customers abroad - In both cases, appellants have deposited applicable service tax and in case of Lakshay International, 25% of penalty was also deposited - Authorities below have accepted the contention of appellants regarding non-applicability of service tax to appellants before 18.04.2006 - While the appellant's claim that extended period is not invokable as issue involves interpretation of law, claim of Revenue is that the appellants having not registered themselves; having not paid applicable service tax have suppressed material facts before the Department - Appellants are not contesting the applicability of service tax to them - However, they dispute the invocation of extended period; quantum of duty confirmed and penalty imposed - Extended period is rightly invoked relying on case of Vidarbha Cricket Association and Shree Guru Kirpa Construction Company 2019-TIOL-3501-CESTAT-AHM - Coming to quantification of duty, it is found that the appellants have produced Chartered Accountant certificates regarding commissions paid to overseas agents for the period before and after 18.04.2006 - Lower authorities have simply relied on the figures proposed in SCN and have not discussed at all the CA certificates - They have not also contradicted the said certificates - Certificates given by Experts in respective fields cannot be ignored without cogent reasons - Therefore, duty has been correctly paid by appellants - Appellants have taken the plea that in case of G.D. Tools and Forgings, applicable service tax has been paid along with interest before the issuance of show cause notice; in case of Lakshay International, service tax along with interest and in addition 25% of penalty has been paid - Therefore, appellants have made out a case under the provisions of Section 73 and Section 80 of Finance Act, 1994 - Accordingly, no penalties can be sustained on appellants - Finally, duty demand is restricted to amount already deposited by appellants along with interest - All penalties are, however, set aside: CESTAT
- Appeals partly allowed: CHANDIGARH CESTAT
2023-TIOL-659-CESTAT-MUM
PMI Organisation Centre Pvt Ltd Vs CCGST & CT
ST - The issue involved is about denial of refund of Cenvat Credit on various services under Rule 5 of CCR, 2004 against export of service and period in dispute is from October, 2016 to June, 2017 - The assessee is engaged in providing services namely Business Auxiliary Service and majority of their customers situated abroad for which they receive remuneration in foreign currency and services rendered by them qualify as 'export of service' - On the very same ground, Tribunal in assessee's own case for period October, 2013 to September 2016 i.e. immediately preceding the period herein, granted relief to assessee by allowing their appeals vide 2022-TIOL-1063-CESTAT-MUM - In the matter of BNP Paribas India Solution Pvt. Ltd. 2021-TIOL-831-CESTAT-MUM, Tribunal while allowing the appeal of assessee therein allowed the refund claim u/s. 5 ibid by holding that since the provisions of Rule 14 ibid has not been invoked, refund of Cenvat credit as claimed by assessee under Rule 5 ibid cannot be denied - It is settled legal position that in absence of any notice for recovery as provided by Rule 14 ibid the refund claimed by assessee under Rule 5 cannot be denied - Nothing contrary has been produced on record - Rather the decision in matter of Qualcomm India Pvt. Ltd. 2019-TIOL-3938-CESTAT-HYD has been affirmed by High Court in 2021-TIOL-2305-HC-TELANGANA-ST by dismissing the appeals filed by revenue against said decision of Tribunal - The authorities below have erred in rejecting the refund claim of assessee - Accordingly, impugned orders are set aside: CESTAT
- Appeals allowed: MUMBAI CESTAT
2023-TIOL-658-CESTAT-MUM
Wellknown Polyester Ltd Vs CC
Cus - The issue involved is, whether Education Cess and Secondary Higher Education cess can be debited through MEIS/SEIS scrips in view of clarification issued vide Board's Circular No.02/2020-Cus. - Payment of Social Welfare Charge through debiting MEIS/ SEIS scrips has been accepted by Commissioner by relying upon Board's Circular but for Education Cess and Secondary & Higher Education Cess it has been held that these are not covered by clarification and have to be paid in cash only, whereas according to High Court of Judicature at Madras on identical issue in matter of KTV Health Food Pvt. Ltd. 2021-TIOL-1941-HC-MAD-CUS while extending benefit of Board's clarification has held that benefit of Board's circular cannot be denied to importer on the ground that Education Cess is different component from BCD - In the aforesaid decision High Court made it clear that benefit of Board's circular, which permits the payment of basic customs duty or additional customs duty through MEIS scrips by virtue of its clause 11, cannot be denied for education cess or higher and secondary education cess being a different component - The High Court while arriving at conclusion has also taken note of decision of Supreme Court in matter of M/s. Unicorn Industries 2019-TIOL-528-SC-CX-LB which has been relied upon by Commissioner while confirming the demand - One more thing, judgments of Supreme Court as have been relied upon by commissioner in impugned order are of the period prior to issuance of Board's circular of 2020 and that circular was not in issue therein whereas the appeal mainly rests on said circular - Therefore, issue is no more res judicata and in view of clause 11 of Board's circular, which permits the payment made through debit in duty credit scrips for past cases, there is no justification for insisting in cash payment towards education cess and secondary & higher education cess and accordingly the issue is decided in favour of appellant herein - Resultantly, impugned order is set aside: CESTAT
- Appeal allowed: MUMBAI CESTAT
2023-TIOL-657-CESTAT-MUM
D P Logistics Pvt Ltd Vs Pr.CC
Cus - The limited issue for determination is revocation of 'customs broker' licence and forfeiting security deposit under regulation 14 of CBLR, 2018, besides imposing penalty of Rs. 50,000 under regulation 17 of Customs Broker Licencing Regulations - It is their claim of injustice having been done to them on the ground that impropriety of their Director operating for his personal benefit in dealing with M/s Dhariya International, an exporter, has been unfairly laid at their door - It is not in dispute that the derelict individual was discharged from employment and relived of his directorship promptly - It is also not alleged anywhere that other directors were parties to, or cognizant of, the scheme of deception to avail incentives undeservedly - Nor is there any evidence the appellant derived any financial compensation, small or large, from exporter - Indeed, impugned order is categorical solely on vicarious role of appellant in entire misdemeanour - Therefore, finding of charges for breach of regulation 10 of CBLR, 2018 has no basis at all - Misdemeanour of employee is separate ground for proceeding against licencee in pursuance of vicarious responsibility even if licencee is not an active participant in breach of Customs Act, 1962; such a separate provision is redundant if every breach by an employee were to be treated as breach by licencee - Therefore, while on the finding of licencing authority, appellant cannot be held to have been in breach of regulation 10 of CBLR, 2018, on failure to ensure responsible discharge of duties by an employee, which has not been repelled in their submissions, charge of breach of regulation 13(12) of CBLR, 2018 must be held as proved - Detriment must, invariably, be proportionate to offence - Interest of justice would be adequately served by confirming penalty of Rs. 50,000 under regulation 17 of Regulations, 2018 - The revocation of licence and forfeiture of security deposit ordered under regulation 18 are set aside: CESTAT
- Appeal partly allowed: MUMBAI CESTAT |
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