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2023-TIOL-1156-HC-MUM-CUS
Colossustex Pvt Ltd Vs UoI
Cus - Petitioners' application for amendment of the shipping bills has been rejected, therefore, the present petition - Assistant Commissioner of Customs/Respondent No.4 rejected the request made by the Petitioners in the light of the impugned Circular No.36/2010 Customs dated 23rd September 2010 and, more particularly, applying paragraph 3(a) of the said Circular, inter alia recording that the request for conversion of the shipping bills has not been made within three months from the date of the Let Export Order dated 25th May 2021.
Held : Prior to the amendment of Section 149 by the Finance Act, 23 of 2019, i.e. prior to 1st August 2019, admittedly, there was no authority and/or any power vested with the Central Government to prescribe any time-frame and/or restrictions and conditions to be imposed on amendment of the documents as Section 149 would stipulate - It is admittedly during the prevalence of the provision as it stood prior to the 2019 amendment, that the Circular in question (impugned Circular No.36/2010) came to be issued - The impugned Circular could not have prescribed any time limits when the substantive provision of Section 149 of the Customs Act itself did not confer such power on the Central Government and, hence, for such reason, the impugned Circular prescribing the time limits was per se contrary and ultra vires of Section 149 of the Customs Act - Circular 36/2010 cannot in any manner be elevated to be any regulations considering the plain language of Section 149 read with sub-section (2) of Section 157 and Section 2(32) and 2(35) of the Act - Decision of the Gujarat High Court [in Mahalaxmi Rubitech Ltd. 2021-TIOL-538-HC-AHM-CUS ] on the Circular in question was applicable and binding on all the customs jurisdictions throughout India - Petition succeeds in terms of prayer clauses (a) to (c): High Court [para 15, 21, 22, 24]
- Petition allowed: BOMBAY HIGH COURT
2023-TIOL-843-CESTAT-KOL
Graphite India Ltd Vs CCE
CX - The Assessee is engaged in the manufacture of dutiable final products, comprising Calcined Petroleum Coke (CPC) and Carbon Paste - Raw Petroleum Coke (RPC) is their principal input - In the relevant period, RPC was procured from M/s Indian Oil Corporation against Central Excise invoice - The same was cleared on payment of duty to M/s Universal Hydrocarbon Company Limited (UHCL) for manufacture of CPC - M/s UHCL availed the Cenvat credit equivalent to the amount of Central Excise duty paid on the quantity of RPC so sent by the Assessee - After processing, M/s UHCL cleared the CPC to the Assessee on payment of duty, under the cover of excise invoices and the Appellant availed the Cenvat credit on the same - Thereafter, the Assessee further undertook processing of mixing of different qualities of their manufactured CPC, sizing, quality check and packaging and cleared the same, on payment of duty, to customers - In the relevant period, the final products cleared by the Assessee were cleared by the Assessee both on FOR as well as on ex-factory basis - In respect of FOR Sales, the transportation charges were forming a part of the sale price of the goods and the Assessee was discharging excise on such sales price - In respect of ex-factory sales, the Appellant arranged transportation on behest of the customers and the same was separately collected from the customers - In such cases, excise duty was being paid on the transaction value excluding the freight component - The audit of the records maintained by the Assessee was conducted by the Audit team of Central Excise Commissionerate Patna and Audit Report alleged that transportation charges amounting to Rs. 93,27,049/- was collected by them towards delivery of goods to different customers attract central excise duty @ 16%, amounting to Rs. 15,22,175/ - It was also alleged by the Audit that CPC received by the Assessee from UHCL has been entered by the Assessee as a final product in RG-1 register and therefore, CENVAT credit of Rs. 56,84,435/- taken by them on the CPC received from M/s UHCL is not admissible as the same is not input - On the basis of the said Audit Report, a Show Cause Notice dated 30.06.2009 was issued to them central excise duty of Rs.15,22,175/- on the alleged ground of non-inclusion of transportation charges in the value of final products - It was also proposed to deny the cenvat credit of Rs.56,84,435/- taken by them on the CPC received from M/s UHCL, as it was not an input - The Notice also proposed to levy interest and impose penalty - The Notice was adjudicated by the Adjudicating Authority vide Order-in-Original dated 26.08.2011 wherein the demands made in the Notice were confirmed along with interest and penalty - Aggrieved against the subject order, the Assessee has filed the present appeal.
Held - Transportation charges - The first issue is non-inclusion of transportation charges in the assessable value amounting to Rs.15,22,175/- confirmed in the impugned order along with interest and penalty equal to amount of duty - We find that the issue is no longer res integra inasmuch as the same stands settled in favour of the Appellant by this Tribunal in the case of Aditya Birla Chemicals (India) Ltd. Vs Commissioner of Central Excise reported in 2021 (376) E.L.T. 390 (Tri. - Kolkata)] - Following the ratio of the decision cited above, we hold that the transportation charges are not includable in the assessable value - Accordingly, the demand of central excise duty of Rs.15,22,175/- confirmed in the impugned order on the ground of non-inclusion of transportation charges is not sustainable: CESTAT
Held - Cenvat credit - The Department has not questioned the duty payment by UHCL on the CPC - There was also no dispute regarding the receipt of the duty paid inputs into the factory - Once the duty has been paid by the assessee and the materials were received into the factory, Cenvat credit cannot be denied. Further, even if the activities carried out by them do not amount to manufacture, Cenvat credit shall be allowed in terms of Rule 16 of the Central Excise Rules, 2002 - Rule 16(2) of the Central Excise Rules, 2002 clearly provides that in circumstances where the process does not amount to manufacture, the manufacturer shall pay an amount equal to the CENVAT credit taken at the time of receipt of the goods - In the present case, the Appellant has paid much more central excise duty than the CENVAT Credit availed by them on the CPC received from UHCL - Therefore, CENVAT credit availed cannot be denied on the ground that they were not inputs - Even if they were considered as ‘inputs', Rule 3(5) of CENVAT Credit Rules, 2004 provides that when inputs on which CENVAT credit has been taken, are removed as such from the factory, the manufacturer of the final products or provider of output service, as the case may be, shall pay an amount equal to the credit availed in respect of such inputs - In the present case, the Appellant has paid much more central excise duty than the CENVAT Credit availed by them on CPC received from UHCL which would be clear from the statement annexed to the compilation - In that event, the Appellant cannot be asked to reverse the CENVAT Credit once again - Hence the credit availed by the Appellant cannot be denied on the ground that it has been entered as finished goods in their RG-1 and hence it is not an input - In view of the above discussion, the demands confirmed in the impugned order are liable to be set aside - As the demand does not sustain, the interest or penalty does not survive as well: CESTAT
- Appeal allowed: KOLKATA CESTAT
2023-TIOL-842-CESTAT-MAD
Alstom T And D India Ltd Vs CGST & CE
CX - Appellants are engaged in manufacture of Relays and Control Panels - They also consumed relays captively in manufacture of control panels - They did not pay excise duty on goods which were captively consumed and claimed exemption under Notfn 67/95-CE as amended - The control panels were cleared for home consumption on payment of duty and also were cleared without payment of duty by availing exemption under Notfn 6/2006-CE - The department was of the view that appellants are not eligible for exemption under Notfn 67/95-CE on intermediate goods captively consumed and have to pay excise duty on relays/ control panels cleared for captive consumption - Two SCNs were issued to demand duties along with interest and for imposing penalty - It is submitted that confirmation of demand by Department is fallacious - The issue stands covered in appellant's own case in 2019-TIOL-1265-CESTAT-MAD and it was observed that the eligibility of appellant-assessee for exemption under Notfn 67/1995 cannot be disputed - They have followed provisions and complied with provisions of Rule 6 and all the connected requirements of Notfn 67/1995 - The Tribunal in said case followed the decision in case of Areva T & D India Ltd. = 2018-TIOL-858-CESTAT-MAD - Following the same, demand cannot sustain and requires to be set aside: CESTAT
- Appeals allowed: CHENNAI CESTAT
2023-TIOL-841-CESTAT-AHM
Vikram Plasticizers Vs CCE & ST
Cus - The issue involved is that whether the high density polyethylene granules which is chemically modified is liable for exemption under Notfn 12/2012-Cus (Serial No. 237) or otherwise - Case of department is that since HDPE granules imported by appellant is chemically modified the same does not remain as HDPE and accordingly, exemption Notfn 12/2012-Cus will not be available to appellant - The product is high density polyethylene and it consists of 98% ethylene by weight - Therefore, even though some additives in very miniscule percentage exists in composition but chemical character of product i.e. high density polyethylene does not get altered and same cannot be classified in any other entry other than high density polyethylene - Therefore, even though miniscule percentage of different chemicals including additive mixed with HDPE, the goods remain as high density polyethylene and therefore clearly covered under exempted entry in Notfn 12/2012-Cus - Accordingly, appellant is entitled for exemption under Notfn 12/2012-Cus in respect of their imported goods i.e. High density polyethylene - Hence, impugned order is set-aside: CESTAT
- Appeal allowed: AHMEDABAD CESTAT
2023-TIOL-840-CESTAT-CHD
GSKCH Employees Cooperative Canteen Ltd Vs CCE
ST - The Assessee is a co-operative society registered under the Punjab Co-operative Societies Act, 1961 - The Assessee is engaged in providing the canteen services to M/S GlaxoSmithKline Consumer Healthcare Pvt. Ltd. ('GSKCH Ltd.') pre19.09.2002 - The employees of GSKCH Ltd. formed the present co-operative society i.e., the Assessee for supply of meals and light refreshments to the employees of GSKCH Ltd - All the employees of GSKCH Ltd. are members of the Assessee-society - The Assessee is registered as a 'service provider' under 'outdoor catering services' and also under VAT. For the purposes of operation of the Appellant's canteen, GSKCH Ltd. provided space within the factory premises for running the canteen and also some materials and fixed assets to the Assessee - Also, in cases of loses in any particular financial year, the Assessee often receives subsidy from GSKCH Ltd - The Assessee serves the food items to the employees of GSKCH Ltd. in consideration of some money on which VAT was duly been discharged by the Assessee during the Relevant Period. Also, on the amount received as subsidy, no service tax was deposited by the Assessee in light of the settled law in sales tax regarding non leviability of VAT on amounts received as subsidy - On these allegations, a show cause notice was issued to the Assessee proposing to recover service tax of Rs. 57,66,971/- for the applicable services of outdoor catering services along with applicable interest and penalty by invoking the extended period of limitation.
Held - The prayer is only confined to the imposition of penalty as the Assessee has already paid the service tax along with interest much before the issuance of show cause notice - Even the audit on the Assessee has not been conducted and no audit objection was raised - On perusal of Section 73(3) shows that if a tax is paid along with interest before the issuance of show cause notice then in that case show cause notice shall not be issued and in the present case also, we find that the contention of the Assessee that they had bona-fide belief that they are not liable to pay service tax but when they realised on their own, they immediately paid the service tax along with interest which is admitted in the impugned order itself - The case laws relied upon by the DR are not applicable in the facts and circumstances of the present case because in those decisions the assessee has challenged the levibility of service tax on outdoor catering services which was adjudicated by the authorities below whereas in this case the Assessee suo-motu without being pointed by the Department paid the service tax along with interest much before the issuance of show cause notice hence the issue of imposition of penalty is covered by the various decisions cited (supra) in favour of the Assessee - Hence the Assessee is not liable to pay penalty under Section 77 & 78 hence we allow the appeal of the Assessee by setting aside the penalties on the Assessee: CESTAT
- Appeal allowed: CHANDIGARH CESTAT |
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