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2023-TIOL-1134-CESTAT-MAD
Usha International Ltd Vs CC
Cus - There was differential duty worked out, which was accepted and also paid by appellant - From the documents placed on record, no mala fides found on the part of appellant - A perusal of e-mail exchanged between appellant and their vendor clearly indicates the request insofar as MRP is concerned, but however, it was perhaps the mistake of vendor/supplier in not effecting required RSP tag - No doubt, original price as per purchase order, which is placed in appeal memorandum was INR 2400 per piece - There was a request e-mail from appellant to incorporate the new MRP on account of sharp change in INR versus USD and in reply, the seller / vendor appears to have enclosed the new MRP list, which is also placed in appeal memorandum, wherein the new MRP of "400 mm Maxx air pf" is shown as INR 2650/- - However, in one of the e-mail correspondences which is dated 14.09.2013, the vendor has indicated the MRP as INR 2100/- only - Admittedly, the importer claimed exemption from 4% SAD which was ultimately denied as there was alleged mis-declaration of MRP - In any case, differential duty was duly remitted by appellant and moreover, MRP affixed on goods imported (of INR 2100) was never the agreed amount; the purchase order gives a different amount, which was sought to be revised as per new MRP list at INR 2650/- - Hence, how the MRP of INR 2100/- was affixed lacks any support since the same was never agreed upon nor is there any discussion, other than the e-mail - There was an understanding as regards the value is concerned, in support of which documents in form of e-mails have been placed on record, which are not disputed by Revenue - The value affixed on label did not clearly show the price agreed upon in purchase order - Further, said price tag was sought to be revised for the reason of fluctuation in value of Indian Rupee as against U.S. Dollar, which fact was also not disputed, but however, same apparently was not implemented by foreign vendor / supplier - Moreover, what was declared in Bill-of-Entry by appellant was duly supported by revised MRP list, which was also agreed to between the parties - Even otherwise, as clarified elsewhere in this order, MRP is the maximum retail price at which an item could be sold whereas RSP is the retail sale price, which is at the discretion of seller - Hence, the bona fides of appellant cannot be suspected just because the vendor / supplier chose to affix a different price tag and therefore, there is no case for Revenue to order confiscation of goods in question - Consequently, there is no question of redemption fine under Section 125 ibid: CESTAT
- Appeal allowed: CHENNAI CESTAT
2023-TIOL-1133-CESTAT-AHM
Ford India Pvt Ltd Vs CC
Cus - Appellant have imported various items which are undisputedly used in manufacture of motor vehicles by them - The appellant had sought classification of these items under various chapters like 73, 83, 84, 85 and 96, however revenue has classified the said goods under the heading 8708 - They argued that in earlier order in their own case, matter has been remanded in their own case relying on decision of Tribunal in case of M/s. Suzuki Motor Gujarat Pvt Ltd - It was pointed out that in aforesaid decision a criteria has been laid down for examining the classification based on observations in HSN/Sections/chapter notes of custom tariff - It is noticed that said order takes note of HSN Explanatory notes part (III) which lays down the criteria for classification of parts and accessories - A perusal of impugned order shows that impugned order does not take notice of this explanatory note - The criteria laid down by impugned order does not correspond to the criteria laid down in HSN Explanatory note - Matter is remanded to Adjudicating Authority for fresh adjudication after taking note of the aforesaid Tribunal order and the criteria for classification made therein: CESTAT
- Matter remanded: AHMEDABAD CESTAT
2023-TIOL-1132-CESTAT-BANG
Geltec Pvt Ltd Vs CCE
CX - Appellants are engaged in manufacture of pharmaceutical products viz., 'soft gel capsules' - During course of manufacture, the product viz., "Gelatin Mass Waste" emerges, which the appellant destroyed in their own factory and in compliance with provisions of Drugs and Cosmetic Act and Rules made therein, since it is a bio-hazardous product - A SCN was issued with proposal for reversal of CENVAT credit used in manufacture of such waste product with interest and proposal for penalty - This Tribunal in their own case considering the Circular issued by Board held in their favour observing that demand for reversal of CENVAT credit on waste product is unsustainable in law - The said view has been later upheld by Karnataka High Court in 2011-TIOL-968-HC-KAR-CX - No merit found in impugned order, same is set aside: CESTAT
- Appeal allowed: BANGALORE CESTAT
2023-TIOL-1131-CESTAT-AHM
Intas Pharmaceuticals Ltd Vs CCE
CX - The Assessee is engaged in manufacturing dutiable as well as exempted medicaments - It availed cenvat credit and hence they have opted for following the scheme envisaged under Rule 6(3A) of the cenvat credit rules, 2004 - In the FY 2011-12, the Assessee reversed the cenvat credit on monthly basis proportionately under Rule 6(3A) at the end of the FY 2011-12 - This proportionate reversal worked out to Rs. 1,93,98,476/- on provisional basis - However, on determination of final amount of reversal of cenvat credit, the Assessee found that actual amount that was reversible was only Rs. 91,41,144/- and thus the Assessee was eligible to claim re-credit of Rs. 1,02,57,602/-, since the provisional reversal during the FY 2011-12 was in excess by that amount - Pursuant to the audit of the records, an SCN came to be issued alleging that the Assessee had failed to follow the prescribed condition of Rule 6(3A) for reversal of credit by not including the credit amounting to Rs. 1,58,66,384/- which pertains to the input credit on the services mentioned in Rule 6 (5) in the year 2011-2012, since Rule 6(5) was omitted w.e.f 01.04.2011 - The SCN also alleged that further the sum of cenvat credit amount of Rs. 3,52,69,062/- was wrongly availed in the month of October, 2012 and December, 2012 whereas the credit pertained to the financial year 2011-12 - On this contention, the SCN proposed to demand amount of Rs. 1,63,41,548/-, a short paid/ reversed credit due to non-inclusion of the amount of Rs. 1,58,66,384/- and Rs. 3,52,69,062/- at the time of quantification of the amount to be reversed for the period 2011-12 - The adjudicating authority held that though the credit was availed in the month of October & December, 2012, the credit pertained to the financial year 2011-2012 and so the Assessee is lawfully eligible for its exclusion - However, he confirmed the demand of inclusion of input service credit amounting to Rs. 1,58,66,384/- pertaining to services covered by Rule 6(5) of the Cenvat Credit Rules, 2004 availed in the year 2011-12, on the ground that the services for the said amount were availed in the year 2011-12 and the credit was also taken in the same year - Thus, the Commissioner upheld the order and required the appellant to pay 51,74,729/- as cenvat credit short paid/reversed, since the amount of Rs. 1,58,66,384/- was not included by the Assessee at the time of quantification of the amount to be reversed as per Rule 6(3A) - Further, the Commissioner also confirmed levy of interest and imposed penalty of Rs. 13,00,000/- under Rule 15 of the Cenvat Credit Rules, 2004 - Hence the present appeal. Held - The limited issue at hand is whether the eligibility of the cenvat credit should be considered as on the date of receipt of the service or on taking the credit in the books - As per the judgments cited by the Assessee, it is a settled law that the eligibility of the cenvat credit has to be considered as on the date of receipt of the services for the reason that the moment Assessee received the service along with invoices on that date the cenvat credit stand accrued to the Assessee - As per the excel sheet submitted by the Assessee in respect of all the invoices related to the credit of Rs. 1,58,66,384/-, it is observed that all the invoices are pertaining to the period prior to 01.04.2011 - As we opined that the eligibility of the credit to be considered as on date of receipt of service but in the present case the Adjudicating Authority has not examined the actual date of receipt of service - Therefore, for this limited purpose matter needs to be remanded back to the Adjudicating Authority - There can be no agreement with the Adjudicating Authority that only for the reason that the credit was availed after 01.04.2011 when Rule 6(5) was omitted, the appellant are not eligible for cenvat credit on 16 services as prescribed in the said Rule - Even though the Rule 6(5) was omitted from 01.04.2011, if it is proved that services were received prior to 01.04.2011, the credit taken after 01.04.2011 shall be admissible to the Assessee: CESTAT
- Case remanded: AHMEDABAD CESTAT
2023-TIOL-1130-CESTAT-DEL
Bharat Hotels Ltd Vs CCE
ST - The Assessee are engaged in supplying the Aircraft/Helicopter belonging to /owned by them to various entities for their use on mutually agreed terms and conditions with the service recipients - While providing the said helicopter/ aircraft on charter hire, the Assessee supplied its own crew i.e. Pilot and other flying thereby keeping an effective control and possession of the said helicopter/ Aircraft with them - With these observations and verifying the same from the documents demanded from the appellants, Department formed the opinion that the said services appeared to be covered under the taxable category of "supply of tangible goods services" taxable under service tax w.e.f. 16.05.2008 - The Assessee however was not registered for supplying the said services - Resultantly, a SCN No.36642 of 18.06.2013 was served upon the Assessee proposing the recovery of service tax amounting to Rs.1,41,04,760/- alongwith the amount of Education Cess, the proportionate interest and the appropriate penalties under section 76, 77 and 78 of the Finance Act - The Assessee was also alleged to have deliberately indulged in concealing the facts from the Department with sole intention to avoid payment of service tax to the Government Exchequer - The said proposal has been confirmed vide the order. Held - In the light of the EIH Ltd. vs. Commissioner of Central Excise, Delhi-I decision, the Assessee was liable to pay the service tax w.e.f. 16.05.2008 but the said demand has been raised vide the Show Cause Notice dated 18.06.2013 i.e. by invoking the extended period of limitation - It is the case of the Assessee that they were under the bonafide belief that the services rendered by them are "transportation of passengers by air service" which was not taxable prior to 01.07.2010 - It is also very much apparent that beyond this date the Assessee are regularly discharging their service tax liability - Hence, there is no reason to reject the stand taken by the appellants of having a bona fide belief - Nothing is produced by the Department to prove the mala fide intent on part of the Assessee to evade the tax liability - The mere allegation will not be sufficient for the Department to invoke the extended period of limitation - We also observe that whenever the Assessee were enquired and some documents were demanded from them, they had co-operated the Department - In such circumstances, it is held that there is no element of suppression or mala fide intention on the part of the Assessee - Extended period is, therefore, held to have been wrongly invoked - Once there was no malafide intent, the question of imposition of penalty does not at all arise - The Assessee rather is held entitled to the benefit of Section 80 of the Act - Hence the services in question are held to be 'Supply of Tangible Goods Services' - However Show Cause Notice is held as time barred - Entire demand gets hit by limitation - Hence the order under challenge is hereby set aside - Both the appeals are allowed with consequential benefits to the appellants: CESTAT
- Appeal allowed: DELHI CESTAT |
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