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2023-TIOL-859-CESTAT-AHM
Deep Recycling Industries Vs CCE & ST
Cus - The dispute is, if appellants have imported and used brass scrap correctly in terms of provision of Notfn 52/2003-Cus, read with provisions of import-export and SION Norms - Commissioner (A) has in principle allowed the benefit on all issues however remanded the matter for verification of fact, if brass scrap imported by appellants was in nature of brass scrap containing impurities like iron, steel, rubber, plastic or not - He is of the opinion that benefit of segregation can be allowed only if imported scrap contained impurities like iron, rubber, plastic and steel - Prima facie from the Circular 1029/17/2016-CX , it is seen that even the revenue is of the belief that "honey grade" scrap also contains iron, steel as impurities - It is seen that this circular was not produced before original or first appellate authority and consequently there is no examination of this circular - The circular has been issued after date of passing of impugned order - The original Adjudicating Authority will examine the applicability of this circular and any other circular issued on the subject to remand directions given in impugned order and decide the issue a fresh - While doing so it shall be free to decide the nature of product imported by documentary evidence or otherwise on the basis of materials already on record: CESTAT
- Matter remanded: AHMEDABAD CESTAT
2023-TIOL-858-CESTAT-KOL
Emami Paper Mills Ltd Vs CCE & ST
ST - Appellant is in appeal against impugned order demanding service tax and imposing penalty - They obtained loans from abroad by means of External Commercial Borrowing (ECB) in terms of approval granted by Govt. of India/Reserve Bank of India in order to finance capital expenditure required for modification and expansion of their plant - Prior to 18.04.2006, service tax was not payable by appellant for loan obtained by them from foreign bankers, who are not having their registered office in India under Reverse Charge Mechanism as held by Bombay High Court in case of Indian National Shipowners Association , therefore, tax liability was not sustainable against appellant - With regard to legal charges, taxability on legal charges came into effect from 01.09.2009 and said legal charges has been paid by appellant prior to that - In that circumstances, no service tax is payable by appellant for legal services received under Reverse Charge Mechanism - With regard to rest of demand, appellant has admitted they are liable and paid immediately when it is pointed out to them during course of investigation - As admittedly, demand has been paid by appellant and remaining demand is not payable by them, no amount is payable by appellant except an amount of which is already paid by appellant and appropriated by adjudicating authority - As appellant has paid disputed amount of service tax immediately on pointing out by authorities, therefore, giving them the benefit of section 80 of Finance Act, 1994, no penalty is imposable on appellant - Therefore, penalties imposed on appellant are also set aside: CESTAT
- Appeal allowed: KOLKATA CESTAT
2023-TIOL-857-CESTAT-CHD
CCE Vs C S Zircon Pvt Ltd
CX - The Assessee is engaged in the manufacture of Zirconium Oxide and Zirconium Oxychloride - The Assessee applied for amendment of the classification of the products from CETSH 28.25 to 26.15 vide letter dated 28.03.2003 - The Revenue filed a declaration dated 12.03.2004 showing their intent to avail the benefit of Notification No.50/2003 dated 10.06.2003 - The Assessee continued to classify their products under CETSH 26.15 - The Revenue challenged the classification and an OIO dated 30.06.2006 decided the classification under CETSH 28.25 - On an appeal filed by the respondents, Commissioner (Appeals) allowed the appeal and held that the product merits classification under CETSH 26.15 - On an appeal filed by the Department, the CESTAT vide Final Order dated 24.06.2008 allowed the appeal filed by the Department and held that the impugned products merits classification under CETSH 28.25 - Meanwhile, the Department issued four show-cause notices dated 05.06.2007, 01.05.2008, 20.01.2009 and 28.05.2009 - Extended period was invoked in the first Show-Cause Notice - The Commissioner vide impugned order held that extended period is not invokable - Cum-duty benefit and SSI exemption can be allowed and benefit of CENVAT credit on all inputs and input services is permissible - Revenue is an appeal on the ground that the Commissioner erred in holding that extended period is not invokable and that cum-duty benefit is available to the Assessee on the basis of the grounds specified in the appeal.
Held - Limitation - The Department claims that the Assessee suppressed the true nature of the goods manufactured by them and have wrongly classified the same with an intent to avail the benefit of the Notification No.50/2003 in a fraudulent manner - Mere knowledge of the Department is not enough - We find that in the instant case, the Assessee have informed the Department as early as on 28.03.2003, their intention to change the classification - Though the intent of extending area-based exemption was made public by the Ministry of Commerce in the month of January 2003, actual notification, exempting the goods by the Finance Ministry, was issued on 10.06.2003; it cannot be inferred that the Revenue have changed the classification with a view to avail undue benefit; even if we accept such a proposition, the intent to change the classification was informed to the department in March 2003 itself - The Department was free to cause necessary verification and to change the classification - The argument that verification took long time because of the procedures involved like testing by the agencies, cannot be a reason to allege suppression of fact; there should be a positive act of suppression, wilful mis-statement with an intent to evade payment of duty so as to attract the provisions of Section 11A for invoking the extended period - We find that the Department has not produced any such evidence to that effect: CESTAT
Held - Cum Duty - The Department relied on the Supreme Court's judgment in Amrit Agros Vs CCE - The judgment though rendered in the context of un-amended Section 4, lays down the principle for arriving at the cum-duty price - To our understanding, the ratio of the judgment is that it is for the claimant to show that the price/ value shown in the invoices is inclusive of duty payable or paid irrespective of the fact whether such duty paid or payable is shown separately or not - It is canvassed that since the Assessee availed exemption, the decision of the Supreme Court in Bata India Limited would apply - However, this, has to be decided on a case-to-case basis - The Assessee produced copies of invoices issued by them - Considering the duty figures, it is seen that the total invoice value subsumes the Cenvat duty - Accordingly, the value adopted requires to be considered as a cum-duty price - Hence the benefit of cum duty is available to the Assessee: CESTAT
- Appeal allowed: CHANDIGARH CESTAT
2023-TIOL-856-CESTAT-CHD
Punj Brothers Ltd Vs CCE
CX - The allegation of Department is that appellant and M/s Lal Punj Brother are inter-connected/ related in terms of Section 4 (3) (i) of Central Excise Act, 1944 and as such, duty payable on clearances made by appellant to related party should be, as per Rule 8 of Central Excise Rules, 2000, at the rate of 115% - It is the case of appellants that Department has failed to show that both the units have mutuality of interest as per provisions of subclause (ii), (iii) & (iv) of Rule 8/Rule 9 of Valuation Rules, 2000 - Argument of appellant is acceptable - Though, Department holds that the two units are related, they fail to show the mutuality of interest - Also, the fact that appellants do not sell 100% of their production, to related person, so as to invite assessment at the rate of 115% of cost of production, is completely ignored - Appellants have correctly relied the case of South Asia Tyres Ltd. = 2002-TIOL-486-CESTAT-MUM - Looking into the fact that appellants have deposited duty demanded well five years before the issuance of SCN there too on a debatable issue, extended period could not have been invoked and SCN should not have been issued for longer period - Appellants have a strong case in their favour, both on merits and on limitation - Imposition of penalty and interest is set aside: CESTAT
- Appeal partly allowed: CHANDIGARH CESTAT |
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