INCOME TAX CIT Vs Vikas International Income Tax - Sections 28(iiib), 80HHC - export - gem stones - polished diamonds - Whether premium...
INCOME TAX
Income Tax - Sections 28(iiib), 80HHC - export - gem stones - polished diamonds - Whether premium on the licences purchased by assessee from outside parties for sale or import, would be liable to be treated as cash assistance taxable u/s. 28(iiib) as against its export eligible to deduction us. 80HHC - Whether the said assistance would be taxable as income from other sources - Whether deduction u/s 80HHC could be claimed on export of cut and polished diamonds and gem stones. - Revenue's appeal dismissed : GUJARAT HIGH COURT
ACIT Vs Manubhai Tribhovandas
(Huf)
Income Tax - Sections 234B, 234C
- Whether the upfront one time payment of interest received immediately on
allotment is deferred revenue expenditure - Whether in case assessee is
creating asset on basis of interest for five years being paid in advance in
first year and, thereafter, the assets written off over period of debentures
for five years continuing benefit to business of the assessee over the entire
period, the liability is to be spread over period of debentures - Whether the
entire amount of interest received as upfront one time payment of interest
immediately on allotment is included in the income for the first year in which
the amount of interest is received. - Revenue's appeal dismissed :
GUJARAT
HIGH COURT
Jose Kuruvinakunnel Vs ITO
Income Tax - cash credit -
rectification application - Whether the High Court can agitate issues which
would require detailed discussions, in a rectification application - Whether
merely for the reason that Tribunal found that the decisions are not
applicable, the Tribunal would not have gone into the dictum laid down therein.
- Assessee's appeal
dismissed : KERALA HIGH COURT
Dighi Port Ltd Vs ITO
Income Tax - Sections 43B, 69
& 133A - wharfage / port dues - royalty - Special purpose vehicle.
Whether the expression 'Tax, Duty, Cess or Fee or by whatever name called' mentioned in the provisions of Sec 43B brings under its sweep port dues payable by the assessee to a government agency - Whether amount payable as royalty for cargo handling to a Public Sector Undertaking can be considered as tax, duty, cess or fee payable - Whether the provisions of section 43B would apply in such a case - Whether amount received in excess of the one mentioned in TDS certificates can be prevented from being treated as income on the basis of contention that TDS was deducted on payment basis - Whether in case an assessee as a special purpose vehicle is constructing, operating and managing a venture and was also having its income, it was also liable to claim corresponding expenditure relating to the said income. - Assessee's appeal partly allowed; Revenue's appeal dismissed : MUMBAI ITAT
Whether the expression 'Tax, Duty, Cess or Fee or by whatever name called' mentioned in the provisions of Sec 43B brings under its sweep port dues payable by the assessee to a government agency - Whether amount payable as royalty for cargo handling to a Public Sector Undertaking can be considered as tax, duty, cess or fee payable - Whether the provisions of section 43B would apply in such a case - Whether amount received in excess of the one mentioned in TDS certificates can be prevented from being treated as income on the basis of contention that TDS was deducted on payment basis - Whether in case an assessee as a special purpose vehicle is constructing, operating and managing a venture and was also having its income, it was also liable to claim corresponding expenditure relating to the said income. - Assessee's appeal partly allowed; Revenue's appeal dismissed : MUMBAI ITAT
ITO Vs Rajasthan Medical Relief
Society
Income Tax - Sections 11(2),
10(23)(iiiac), 12AA, 28, 139(1) & 143(3).
Keywords - society - permitted
time - total reciepts - capital expenditure.
Whether a society which has filed
a declaration in Form 10, after the return u/s 139(1) is filed, can be denied
deduction u/s 11(2) for such delay - Whether such an assessee can claim
exemption u/s 10(23C)(iiiae) - Whether the set off of unabsorbed depreciation
carried forward from earlier years can be allowed from income from other
sources, if the assessee had no income falling u/s 28 of the Act. - Revenue's appeal
& cross objection of assessee, dismissed : JODHPUR ITAT
DCIT Vs State Bank Of India
Income Tax - Sections 33ABA,
194A, 195(1), 197, 201 & 201(1)(a) - Site Restoration Fund account - TDS.
Whether the interest accrued on
SRF a/c maintained with the State Bank of India as per the provisions of sec.
33ABA is subject to provisions of TDS u/s 194A - Whether site restoration fund
maintained as per the provisions of section 33ABA is a time deposit - Whether
in case it has been proved that the payee has included a certain amount in his
income and has paid taxes thereon, the recipient cannot be held liable for non
deduction of TDS thereon - Whether that interest income earned from SRF A/c is
assessable as income from other sources and not as business income - Whether the
provisions of section 33ABA(5), brings to tax the amount which was earlier
allowed as deduction - Whether the interest accruing to SRF a/c is income of
ONGC and the deeming provision as per third proviso to section 33ABA(1) of
treating it as deposit is essentially application of income - Whether in case
ONGC is accounting for the interest in its P&L A/c and then claiming
deduction of deposit which includes the interest accrued on SRF a/c is genuine.
- Assessee's
appeals allowed & Revenue's appeals dismissed : DELHI ITAT
Vandeep Singh Shergil Vs ACIT
Income Tax - Sections 2(47),
143(1), 147, 148 - reassessment, capital gains, housing society, tripartite
joint development agreement.
Whether notice u/s 148 can be
validly issued when capital gain was not duly disclosed by the assessee –
Whether the assessment can be reopened following the decision in case of ACIT V
Rajesh Jhaveri Stock Brokers P. Ltd ,. - Assessee's appeal dismissed : CHANDIGARH ITAT
Prefab Gratings Ltd Vs ACIT
Income Tax Act - Sections 32A, 146,
147 & 154.
Keywords: rectification,
unabsorbed investment allowance, modification of assessment order,
permissibility.
Whether the Assessing Officer can invoke jurisdiction under Section 154 and modify the assessment order for the year in which unabsorbed investment allowance was allowed to be set off without modifying the order of the earlier years whether the allowance was determined to be allowed. - Assessee’s appeal allowed : ANDHRA PRADESH HIGH COURT
Whether the Assessing Officer can invoke jurisdiction under Section 154 and modify the assessment order for the year in which unabsorbed investment allowance was allowed to be set off without modifying the order of the earlier years whether the allowance was determined to be allowed. - Assessee’s appeal allowed : ANDHRA PRADESH HIGH COURT
CIT Vs Harish R Sharma
Income Tax - Sections 68 &
69.
Keywords - unexplained investment
- sales proceed - heirs - house property.
Whether the entire sale proceeds
of a house property can be taxed in the hands of one heir, the assessee, when
there are seven legal heirs for the same - Whether the Tribunal had rightly
restricted the addition, on account of the share of sale proceeds upto 1/7 of
the total amount received - Whether the addition on account of unexplained
investment in house, which belonged to the assessee's father can be deleted by
the appellate authority. -
Revenue's appeal dismissed : GUJARAT HIGH COURT
Arjundas Rajkumar Vs CIT
Income Tax – Sections 139B, 217,
Rule 40.
Keywords: reference, partnership
firm, capital asset, stock in trade, dissolution of property, determination of
value of property, market value, closing stock
Whether where the partnership
deed itself makes it clear that the property is being contributed as an item of
capital as the objective of the firm is to carry on the business in real
estate, such an asset can be considered as a stock in trade – Whether the
market value of the property has to be taken into consideration for determining
the value of property, which is allotted to the respective partners on
dissolution. - Reference answered
in favour of Revenue : ANDHRA PRADESH HIGH COURT
CIT Vs Lord Krishna Bank Ltd
Income Tax - Section 10(23G).
Keywords - exemption - condition
precedent.
Whether there is requirement of a
notification in the official gazette as a condition precedent for availing
exemption u/s 10(23G), in case, the bonds had been issued, in respect of which
exemption is claimed by the assessee. -
Revenue's appeal dismissed : BOMBAY HIGH COURT
CIT Vs Larsen And Toubro Ltd
Income Tax - Sections 271(1)(c) -
Whether penalty for concealment u/s 271(1)(c) can be levied merely on the basis
that assessee has raised a claim which was eventually disallowed by the
assessing authority. - Revenue's appeal dismissed : BOMBAY HIGH COURT
CIT Vs Jayendra H Shah
Income Tax - Section 80IA -
manufacturing activity - remand - Whether cutting and polishing of Diamond is a
manufacturing activity - Whether if the same is not a manufacturing activity,
the deduction u/s 80IA can still be claimed. - Revenue's appeal dismissed : BOMBAY HIGH COURT
CIT Vs Jayant Extraction
Industries
Income Tax - Sections 43(1),
273(2)(a) - enhanced value - depreciation - WDV - succession of firm.
Whether in case of succession of
the firm, depreciation can be allowed on the enhanced value of assets or it has
to be allowed only on WDV of assets being transferred to the successor firm -
Whether an order can be considered as void in case the issuing authority has
not taken prior approval from himself before issuing such an order - Whether in
case of succession of the firm, AO has to make two separate assessments for the
two periods pre and post succession.
- Revenue's appeal partly allowed : GUJARAT HIGH COURT
Sri Ravi Saraff Vs ITO
Income Tax - Sections 50C, 68, 69
& 143(3) - unexplained income - capital gain.
Whether a reference to a
valuation officer can be made as per the provisions of section 50C(2), without
giving an opportunity of being heard to the assessee - Whether in case it is
proved that the assessee from whom an amount has been received, is an income
tax assessee, addition u/s 68 can still be made. Matter Remanded :
HYDERABAD
ITAT
ACIT Vs Velingkar Brothers
Income Tax - Sections 10B,
10B(7), 80IA(10), 92, 94, 147(b), 263 - Whether a business arrangement is
permissible between two concerns - Whether “market price” of the goods
transferred from one concern to other would replace the actual price fetch
though there is no evidence on record to establish that goods are under
invoiced:-Held- Appeal of the revenue is dismissed. - Revenue's appeal
dismissed : PANAJI ITAT
Toscana Lasts Ltd Vs ITO
Income Tax - Sections -11AC, 37, 271
(1)(c)
Keywords: penalty, concealment of
income, furnishing of inaccurate particulars, business expenditure, stock
written off, unpaid expenses, unabsorbed depreciation.
Whether penalty u/s 271(1)(c) is leviable where the assessee claimed that the expenditure incurred was a genuine expenditure debited to the books of accounts of the assessee which was settled by way of issuing the shares and the assessee had submitted the agreement, debit note for these expenses, ledger account the service provider to whom the payments were made and confirmation from that party was also filed in penalty proceedings - Whether claim of assessee can be said to be bogus where the assessee failed to obtain approval from the excise authorities, though the assessee had made a genuine claim of write off with regard to the obsolete items and the fact was disclosed in the return of income. - Assessee's appeal allowed : DELHI ITAT
Whether penalty u/s 271(1)(c) is leviable where the assessee claimed that the expenditure incurred was a genuine expenditure debited to the books of accounts of the assessee which was settled by way of issuing the shares and the assessee had submitted the agreement, debit note for these expenses, ledger account the service provider to whom the payments were made and confirmation from that party was also filed in penalty proceedings - Whether claim of assessee can be said to be bogus where the assessee failed to obtain approval from the excise authorities, though the assessee had made a genuine claim of write off with regard to the obsolete items and the fact was disclosed in the return of income. - Assessee's appeal allowed : DELHI ITAT
ACIT Vs United Shippers Ltd
Income Tax - Sections - 14A &
41(1).
Keywords - Transshipment charges
- reimbursement - miscellaneous income
Whether disallowance under Rule
8D has to be in terms with the decision of the jurisdictional High Court –
Whether any interference by the Tribunal is required when the deletion by the CIT(A)
has no revenue effect. -
Revenue's appeal dismissed : MUMBAI ITAT
Dahej Harbour &
Infrastructure Ltd Vs DCIT
Income tax - Sections 80IA - Port
development - sale of water - storage facility - transportation charges.
Whether when the assessee is engaged
in development of port infrastructure and earns certain income from supply of
water to cargo ship, such income is entitled to Sec 80IA benefits - YES: ITAT
Whether the assessee is also
eligible for deduction u/s 80IA on income earned from storage facility taken on
rent and transportation income earned from sale of water from jetty to party's
place - NO: ITAT - Assessee's appeal
partly allowed : MUMBAI ITAT
Shri K Narendra Reddy Vs DCIT
Income Tax - Sections 133A,
143(3), 194A, 194C, 201(1) & (1A) - Whether it is justified for the Revenue
authorities to invoke the provisions of S.201(1) and S.201(1A) so as to raise
demands on account of non-compliance with the TDS provisions in relation to
payments made in respect of earth works/labour payments when the AO examined
the payments in detail and accepted the additional income offered on these
payments and invoked provisions of S.37(1).
Dr Akilan Ramanathan Vs JCIT
Income Tax - Sections 68, 147
& 148.
Keywords - transfer of fund -
stay - instruction No.1914 - instruction No.96.
Whether the individual assessees
are entitled to blanket the order by demand of stay under the Circular No.96.,
taking into consideration that the difference between the income shown in the
returns and assessment orders is very high. - Assessee's petitions allowed : MADRAS HIGH COURT
Merck Ltd Vs Tarkeshwar Singh
Income Tax - Sections 140A,
143(3), 243, 244(1), 244 (1A)
Keywords: TDS, advance tax, Self
Assessment Tax, refund, interest payable
Whether Self Assessment Tax has
to be treated as tax paid pursuant to the order of Assessment – Whether
interest is payable on refund of self assessment tax from date of assessment
order till grant of refund - Whether in exercise of powers under Article 226 of
the Constitution, Court can direct the statutory authorities to grant interest
as outside the statute. -
Assessee’s writ petition partly allowed : BOMBAY HIGH COURT
CIT Vs Vodafone Essar Gujarat Ltd
Income Tax - Whether an assessee
can be allowed deduction u/s 37(1), regarding expenditure incurred on
telecommunication services, even if there were no business activities carried
on by the assessee in that year. -
Appeal admitted : GUJARAT HIGH COURT
Coromandel Cements Ltd Vs CIT
Income Tax - Sections 256(1) -
power tariff - APSEB.
Whether an allowance can be
permitted, only when the actual accrual takes place, irrespective of the actual
payment - Whether allowing of deduction of disputed amounts, arising out of a
contractual liability would arise, only if the matter has been settled amicably,
or the adjudication has reached finality - Whether such deduction would be
allowed in case neither of the events had taken place. - Assessee's appeal
dismissed : ANDHRA PRADESH HIGH COURT
CIT Vs Islamic Academy Of
Education
Income Tax - Sections 11, 12,
13(4) - Wealth Tax Act, 1957 - Sections 5(i), 21A.
Whether in the absence of any
particular expression, before the word 'Capital' it is to be construed as
'Share' and it would amount to Court legislating which is not permissible -
Whether while granting the benefit to the charitable institution, when the
legislature consciously provided for the funds of the said Trust by way of
investment and they have fixed a limit of 5%, by placing an interpretation,
said benefits can be denied to the assessee. - Revenue's appeal dismissed : KARNATAKA HIGH COURT
CIT Vs Aditya Ferro Alloys Pvt
Ltd
Income Tax - Revenue expenditure
- iron scrap - ingots - capital expenditure.
Whether the expenditure incurred
on reusable cast iron moulds are to be allowed as revenue expenditure - whether
in the nature of manufacturing process carried out by the assessee, where the
shelf life of the cast iron ingot moulds, which is used for about 30 to 40
times and, thereafter, scrapped, could be taken as capital asset or a revenue asset.
- Revenue's appeal
dismissed : MADRAS HIGH COURT
Lsg Sky Chef (India) Pvt Ltd Vs
DCIT
Income Tax - Sections 143(3), 198
& 199.
Keywords - short credit - TDS
Whether the appellate authority
can be said to be at fault when the credit is not allowed to the assessee on
account of some procedural restrictions - Whether an assessee after furnishing
the TDS certificates, credit for which is being claimed, discharges the primary
onus on him toward claiming credit. -
Assessee's appeal allowed : MUMBAI ITAT
SERVICE TAX
CCE Vs Golden Tabacco Ltd
CENVAT - Whether rent-a-car
service amounts to input service as defined under Rule 2(l) of the CCR, 2004
though the said rent-a-car service was rendered at various other places other
than the factory and declared warehouse/ depot of the Respondent – Tribunal has
passed an order containing only two paragraphs of reasoning and held that
credit is admissible without dealing with the question extensively – Tribunal
has also referred to the Ultratech case– it would be fair, just and proper that
the Revenue appeal is allowed and the matter is remitted back to the Tribunal -
without creating any precedent and purely because the matter has been remitted
and restored on account of faulty approach of the Tribunal that the Assessee is
relieved of the condition of pre-deposit – Revenue appeal allowed: High Court -
Appeal
allowed : BOMBAY HIGH COURT
Vinayaka Securities And Detective
Agency Vs DCCE
ST - Government of India
introduced an Amnesty scheme where, those persons who have not paid tax, if
they pay the tax within the stipulated period under the scheme, the entire
interest and penalty is waived – since the assessee has paid the tax and the
interest, the benefit of the scheme should be given to him – Imposition of duty
and interest is affirmed and imposition of penalty u/s 78 of FA, 1994 is
set-aside - Appeal partly allowed: High Court - Appeal partly
allowed : KARNATAKA HIGH COURT
Cidco Ltd Vs CST
ST - Renting of Immovable
property service - lease amount was collected by way of premium at the time of
entering into the ‘agreement to lease' and by way of rental, when the ‘lease
agreement' was entered into by the appellant - expressions ‘other similar
arrangements' used in Section 65(90a) and ‘any other service in relation to such
renting' used in Section 65 (105) (zzzz) are expressions of width and amplitude
- CIDCO ordered to Pre-deposit Rs.20 Crores: CESTAT - Pre-deposit ordered
: MUMBAI
CESTAT
Spring Advertising Pvt Ltd Vs CC,
CE & ST
ST - Appellants are only
collecting the advertising and the same is forwarded to various newspapers for
publication - since they are not undertaking any activity connected with the
making, preparation, display etc., they are not an ‘Advertising Agency' - no
Service Tax payable - orders set aside and appeals allowed: CESTAT - Appeals allowed : MUMBAI CESTAT
Punjab State Federation Of
Cooperative Sugar Mills Ltd Vs CCE
Service Tax – Appellant, an Apex
Body of cooperative sugar mills of Punjab exercises supervisory control over
sugar mills and monitors their functions and receive 0.3% of the sales turnover
from each sugar mill – Demand of service tax under Management Consultant
service - It is not disputed that the appellant is a Federation of the
Cooperative Sugar Mills of Punjab and in terms of the charter of its functions,
it is required to monitor the functioning of its Member Sugar Mills and provide
guidance to them from time to time for improving their efficiency - The
activity of the appellant have to be treated as club or association service as
defined under Section 65 (25a) of the Finance Act, 1994 and hence in view of
the judgment of the Tribunal in the case of Federation of Indian Chambers of
Commerce and Industry vs. CST, Delhi and M/s Electronic and Computer Software
Export Promotion Council vs. CST, Delhi 2014-TIOL-701-CESTAT-DEL no service tax
would be chargeable on the amount being received by the appellant from its
Member Sugar Mills - The impugned order is not sustainable. - Appeals allowed :
DELHI CESTAT
M Rajan Vs CST
Service Tax - Stay / dispensation
of pre deposit – ‘Commercial coaching and training service – appellants engaged
in imparting personal development course and English language skills; viewed as
provision of taxable service for consideration – exemptions under notification
No.9/2003-ST dated 20.06.2003 and No.24/2004-ST dated 10.9.2004 denied in
adjudication – tax demands confirmed and agitated herein.
Held: Tribunal on an identical
issue consistently directed the assessee to make a predeposit of above 25% of
the tax amount – Appellants 1 to 4 respectively directed to pre deposit amounts
of Rs.35,000; Rs.85,000; Rs.80,000; and Rs.1,00,000 within six weeks – upon
compliance, predeposit of the balance dues stands waived and recovery thereof
stayed during the pendency of the appeals. - Pre deposit ordered : CHENNAI CESTAT
Shreenathji Builders Vs CCE &
ST
Service Tax - Refund - Appellant
provided Civil Construction work to a Trust; collected tax and discharged it -
subsequently filed a refund claim on the ground that the service was exempt
from tax under Para 13.2 of CBEC Circular No. 80/10/2004-ST dated 17.09.2004 -
claim rejected in adjudication and upheld by Commissioner (Appeals) on grounds
of limitation as well as unjust enrichment; and agitated herein. - Matter remanded :
AHMEDABAD CESTAT
Patel Engineering Limited Vs CCE,
C & ST
Service Tax - Waiver of
pre-deposit - Pay or Perish? High Court's Order of pre-deposit recalled and
matter remanded to Tribunal to consider financial difficulty: demand was for
about Rs. 33 Crores - CESTAT ordered pre-deposit of about Rs. 30 Crores and
interest. High Court reduced Pre-deposit to 50 percent of the tax demand.
Supreme Court allowed the appellant to file a review petition in the High
Court.
In review order, High Court noted
that the ground of financial incapacity or inability was not dealt with by the
Tribunal, obviously because it was not pressed. The discussion was undertaken
mostly on the contentions, touching upon the legality, or prima facie case.
Earlier order of High Court
recalled and Tribunal's order set aside to remand the matter to Tribunal for
the exclusive purpose of paving the way for the petitioner to urge the ground
of their financial weakness, or inability, before the Tribunal - Appeal allowed by
remand : ANDHRA PRADESH HIGH COURT
CC & CE Vs New Hindustan
Rubber Works
ST - Notfn. 12/2003-ST -
Management, Maintenance and Repairs service - Benefit is available provided
there is documentary proof specifically indicating the value of materials -
since respondents are showing the deemed sale of materials to the extent of 60%
and 40% towards labour charges and not indicating the value of goods and
materials actually sold, cost of materials is not excludible - O-in-O to the
said extent restored: CESTAT
Penalty - Since there was a
difference of opinion on same issue and the matter was referred to the Third
Member, penalty not imposable in view of s.80 of the FA, 1994 - Revenue Appeal
disposed of: CESTAT - Appeal disposed : MUMBAI CESTAT
Light & Life Academy Vs CCE
Service Tax - Stay / dispensation
of pre deposit - "Commercial Training or Coaching Services" under
Section 65 (105) (zze) of the Finance Act 1994 – Applicant firm conducting
Professional Photography Programme in different courses and claimed the benefit
of exemption notification No.24/2004-ST dt.10.9.2004 as it is a vocational
training institute – denied in adjudication, tax demands confirmed with
interest and penalties on firm and individual, agitated herein.
Held: On a plain reading of the
Notification no.24/2004-ST dt.10.9.2004, the exemption benefit is extended to
enable the trainees to seek employment or undertake self-employment directly
after such training or coaching; and not to others who are already employed -
In the present case, the persons who are joining courses are already employed
which is apparently contrary to the conditions prescribed in the notification -
case laws relied upon by the appellant are not applicable, as the present case
relates to persons who are employed and impugned courses are to improve their
career - applicant directed to deposit 50% of the tax; Rs.18,16,071/- which is
appropriated in the adjudication order adjusted and further amount of
Rs.12,00,000/- to be deposited within 8 weeks - Upon deposit of the said
amount, predeposit of balance amount of tax along with interest and penalty
waived on the applicants and its recovery is stayed till disposal of appeals. -
Pre
deposit ordered : CHENNAI CESTAT
CCE Vs Gopal Enterprises
Service Tax – Refund - Works
contract – Respondents providing commercial or industrial construction service
to HPCL; included in new entry at Section 65(105)(zzzza) of the Finance Act
1994 wef 01.06.2007 – Refund claims filed for tax paid prior to 01.06.2007 on
the ground that the services being provided by them were covered by works
contract service, which became taxable only w.e.f. 01/06/07 and hence during
the period prior to 01/06/07 the same were not taxable – claims rejected in
adjudication but allowed by Commissioner (Appeals); agitated by Revenue herein.
Held: No dispute that both the
respondents during the period of dispute had provided the services of
commercial or industrial construction which were taxable at that time under
Section 65 (105) (zzq) readwith Section 65 (25b) - respondent's plea that during
the period prior to 01/06/07, their activity would not be taxable is
unacceptable in view of Delhi High Court ruling in the case of G.D. Builders -
Tribunal also in the cases of Alstom Projects India Ltd. and Instrumentation
Ltd. taken the same view - impugned orders holding that during the period prior
to 01/06/07 the services of civil or industrial construction or erection,
installation or commissioning, provided as indivisible works contract were not
taxable, unsustainable; same set aside and the orders passed by the original
Adjudicating Authority restored. -
Appeals allowed : DELHI CESTAT
Gammon India Ltd Vs CCE, C
& ST
ST -Amendment of Works Contract
(Composition Scheme for Payment of Service Tax) Rules, 2007 by Notf. 23/2009-ST
dt. 7.7.2009 is not a mere clarification of the earlier Rules -since the
contract had commenced earlier, the amended rules would not apply: CESTAT
Works Contract - In the present
case there is no doubt as to the nature of the contract -it involves supply of
material as well as labour - Because there was a separate supply contract for
the supply of transmission towers, it cannot be deduced that the Service
contract is a pure labour contract without looking at the terms of the contract
- facts clearly show that substantial portion of material is involved in the
execution of the Service contract - not merely the nomenclature and form of the
contract that should be seen - What is material is the form as well as
substance of the Contract -both have to be examined before coming to a
conclusion - After reading the contract, we have come to the conclusion that
the Service Contract is a Works Contract: CESTAT
ST -Consumption of goods/Sale -
The condition [clause (i) under explanation to Section 65 (105) (zzzza)] to be
fulfilled for classifying a service under Works contract is that the transfer
of property in goods involved in the execution of such contract is leviable to
tax as sale of goods. Therefore, firstly, there must transfer of property in
goods involved and secondly such transfer of property is leviable to tax as
sale of goods - Commissioner has highlighted the fact that the materials get
consumed in the process of erection and installation and therefore there is no
sale of goods - In our view, this is not correct presentation of facts
regarding use of material - In most case of Works contract involving
structures, important component materials such as Cement and Steel can only be
used in the manner depicted in the photographs - That is to say, these
materials such as steel also remain present in the structure although they may
remain embedded and not visible after the structure is completed - This does
not mean that there is no sale of goods/materials - Going by the Revenue's
reasoning, no such structure can be said to have arisen as a result of
execution of a Works contract - Such reasoning goes against the very definition
of Works contract - records shown by appellants indicate that a significant
percentage of the total contract work under the ‘Service Contract' involves material
component. Therefore we hold that there is transfer of property in goods
involved in the execution of the Service Contract - appellants pay Sales
Tax/Vat on the transfer of property in the goods involved in execution of the
Service contract. Copies of VAT returns have also been placed on record.
Therefore, the second aspect that goods in the Service Contract are leviable to
tax as sale of goods is also fulfilled: CESTAT - Appeals allowed :
MUMBAI CESTAT
BSNL Vs CCE & ST
Service Tax – Stay Order passed
by Tribunal, directing pre deposit, challenged by appellant in HC – Writ
dismissed by HC - Applicant had failed to deposit the directed amount within
the stipulated time and also failed to produce any order staying the operation
of order dated 10.02.2014 by any higher forum - Appeal dismissed for
non-compliance with Section 35F of Central Excise Act, 1944. - Appeal dismissed :
KOLKATA CESTAT
Standard Dry Cleaners Vs CCE
& ST
ST - Appellant providing Dry
Cleaning service - although registered with department, the appellant did not
file any ST-3 return up to September 2005 and did not pay any service tax
during period April 2004 to December 2005 - demand confirmed along with
interest - penalty imposed u/ ss 77 & 78 only & not u/s 76 of FA, 1994
- Commissioner (A) upholding o-in-o - appeal before CESTAT - appellant
contending that since their computer was down they could not deposit service
tax and file returns; that since adjudicating authority had waived penalty u/s
76 by referring to s.80 of FA, 1994 penalties under other sections should not
have arisen.
Held: On holistic reading of the
O-in-O as well as O-in-A it is abundantly clear that having imposed penalty u/s
78, penalty u/s 76 was not imposed as it would tantamount to imposing double
penalty - judgment cited in the O-in-O also were in support of that view -
Nowhere in the O-in-O/O-in-A, there is even a whisper to the effect that S. 80
ibid has even been considered for the purpose of not imposing penalty u/s 76 -
Thus, a mere mention of S. 80 in the order portion is nothing more than an
inadvertence & of no consequence - even if the computer was down, the
appellant could have filed the return manually and paid service tax by
computing the same manually - statutory levies cannot be obviated for so long merely
because the computer was down - having not informed the department, bonafide of
appellant is not above board - It was only when the raid was conducted and they
were caught that they admitted their violations - ingredients for invoking the
provisions of Section 78 are conspicuously present in this case and penalty of
Rs.1000/- imposed u/s 77 is also obviously imposable - Appeal dismissed: CESTAT
- Appeal dismissed :
DELHI CESTAT
Saradha Travels Vs CST
ST - Condonation of delay -
Order-in-Original was pasted on the premises of the appellant on 06.10.2010
under a Mahazar before two independent witnesses as required under Section
37C(b) of the CEA, 1944, since the appellant was not available in the premises
and the premises was also locked - This date is the effective date of service -
However, the appellant construed as if the order was affixed only on 06.10.2011
and filed an appeal before the Commissioner (Appeals) along with a petition to
condone the delay of 32 days - However, the Commissioner (Appeals) held that
the date of service of summons was 06.10.2010 and not 06.10.2011 and dismissed
the appeal - Tribunal also upheld this order and dismissed the appeal relying
on the decision of apex court in Singh Enterprises -
appeal to High Court. Held: Court is in full agreement with the
cited decisions and, therefore, not inclined to entertain the appeal - Tribunal
order is confirmed - Appeal dismissed: High Court - Appeal dismissed :
MADRAS HIGH COURT
CCE Vs Bharat Sanchar Nigam Ltd
CENVAT - Rule 2(l) of CCR, 2004 -
Service Tax paid on rent-a-cab service during the period October, 2009 to
September, 2010, whether eligible for credit as Input service - Revenue appeal
is on the ground that the rented cabs were not exclusively used for the purpose
of providing output service - Commissioner (A) has given a categorical finding
that the cabs in respect of which credit has been taken were used for providing
output service which would clearly make the impugned credit admissible - In the
grounds of appeal, Department has merely stated that the impugned cabs were not
exclusively used for the purpose of maintenance etc. but have not given any
evidence to that effect – also no evidence produced to counter that the
observation in the impugned order-in-appeal are factually incorrect – no
infirmity in order – Revenue appeal rejected: CESTAT - Appeal rejected :
DELHI CESTAT
Agencia Comercial Maritima
Logistics Pvt Ltd Vs CCE, ST & CC
ST - Commissioner confirming
service tax demand on the ground that appellant has provided Cargo Handling
Service – Appellant filing appeal before CESTAT and pleading that submissions
made by them were not at all considered by adjudicating authority . Held: From
the contents of paragraphs 19 & 23 of o-in-o, it can be seen that the
Commissioner has left the analytical work of analysing the case of the
department, the ground taken in SCN & reply etc. to the Tribunal and which
is unacceptable – matter remanded for fresh decision with a direction to
consider submissions made and pass a well-reasoned order whereby it would be
possible for the appellate authority to consider whether the basis for reaching
a conclusion adopted by the original authority is sound and whether the demand
can be confirmed or not – Matter remanded: CESTAT - Matter remanded :
BANGALORE CESTAT
K Shanmugavelu Vs CCE
ST - Appellant had entered into
contract with TNEB to facilitate erection of electricity transmission tower –
in terms of notfn. 45/2010-ST dt 20.07.2010 issued under s.11C of the CEA, 1944
r/w s.83 of FA, 1994, the Central government has exempted all taxable services
relating to transmission and distribution of electricity for the period up to
26.02.2010 & 21.06.2010 respectively – in the present case the demand of
tax is for the period May 2006 to May 2007 relating to transmission of
electricity - in view of the s.11C notification, demand of tax is not
sustainable – order set aside and appeal allowed with consequential relief:
CESTAT - Appeal allowed :
CHENNAI CESTAT
Triveni Structurals Ltd Vs CCE
ST - Since the appellant had
preferred an appeal against the entirety of the adjudication order which
included imposition of penalties thereunder as well and the issue regarding
validity of imposition of penalty was equally the subject matter of appellate
proceedings pending before the appellate Commissioner since 25.5.2007, the date
on which the appeal preferred to that authority had culminated in the order
dated 29.8.2007 dismissing the appeal, the initiation of revisional proceedings
is unsustainable - revisional proceedings initiated by the show cause notice
dated 13.9.2007 and culminating in the impugned order in revision dated
31.1.2008 are in clear transgression of provisions of Section 84(4) of the Act
– Appeal allowed: CESTAT -
Appeal allowed : DELHI CESTAT
CCE Vs Chaman Color Lab &
Studio
ST - Valuation - Photography
Service - Respondent is liable to pay service tax on the gross amount charged
and the exclusion from the assessable value of the value of paper and other
consumables and chemicals used for providing photography service was not
permissible - issue stands decided in favour of Revenue by LB Tribunal in case
of Agarwal Colour Advance Photo System :
CESTAT
Limitation - s. 73 of FA, 1994 -
period of demand is from September 2003 to March 2005 and SCN issued on
23/07/2007 - during the period of dispute there was divergence of views on
account of conflicting judgments of Tribunal/High Courts and assessee had paid
tax in accordance with one group of judgments which were in his favour -
respondent having acted bonafide, longer period of limitation is not available
to Revenue - demand is time barred - for the same reason, penalty u/s 78 is
also not imposable - Revenue appeal dismissed: CESTAT - Appeal dismissed :
DELHI CESTAT
Tafe Access Ltd Vs CCE
Service Tax - Stay / dispensation
of pre deposit – Valuation in respect of "Authorised Service Station and
Repairs Service" – reimbursements received in the course of rendering
taxable service viewed as includible for assessment to tax; demands confirmed
and disputed herein.
Held: Earlier stay order dated
18.02.2013 in appellant's own case applicable; which discussed notification
No.12/2003-ST dated 20.06.2003, holding prima facie eligibility to exemption
under it - pre-deposit of tax along with interest and penalty waived till
disposal of the appeal. -
Stay granted : CHENNAI CESTAT
CENTRAL
EXCISE
Bilag Industries P Ltd Vs CCE
CENVAT - Corporate office is
situated in the registered premises as shown in the ground plan - sister
concern is an 100% EOU unit - supply of steam made to EOU cannot be considered
as “exempted” goods in view of rule 6(6)(ii) of CCR, 2004 - cenvatted Furnace
oil used to generate electricity and steam which is supplied to sister concern
& corporate office - reversal of CENVAT credit and payment of amount under
rule 6 is not warranted - issue of admissibility of such credit was under
litigation and different courts have given different interpretations regarding
admissibility of CENVAT Credit on inputs involved in this issue - extended
period is not invokable - Appeal allowed: CESTAT - Appeal allowed : AHMEDABAD CESTAT
Shri Sachin Gandhi Vs CCE &
ST
Central Excise – Undervaluation –
assessable value adopted for impugned clearances contested by Revenue,
differential duty demands with interest and penalties confirmed in
adjudication, agitated before Tribunal, remanded to original authority and
(re)confirmed in denovo adjudication, now agitated herein.
Held: As per the SCN, main
appellant (Magna Laboratories) was to show cause as to why the price of the
goods as has been charged by M/s US Vitamins be not considered for discharge of
excise duty – lower authority in the impugned denovo order has abandoned the
allegations made in the show cause notice and has held that the price charged by
M/s US Vitamins Ltd. cannot be the price on which excise duty can be demanded
from the main appellant - he has gone beyond the allegations and has confirmed
demands by recording findings beyond scope of the show cause notice, fatal to
the case of revenue in terms of Apex Court ruling in Bellarpur case – in view
of the authoritative judicial pronouncements to the effect that the duty,
interest and penalties on all appellants on a ground different from the
allegations made in the show cause notice, is unsustainable and liable to be
set aside. - Appeals allowed :
AHMEDABAD CESTAT
CCE Vs Thiagarajar Mills Ltd
Central Excise – CENVAT credit -
issue involved is whether the amount equivalent to the credit originally taken
has to be reversed or not for the clearance of the capital goods after usages
for a considerable period; with department viewing that credit originally
availed is to be reversed.
Held: The issue should be
examined in the light of the decision of the Larger Bench in the case of
Navodhaya Plastic Industries - impugned orders set aside and remitted to the
adjudicating authority to decide afresh after considering the cited decision
and the submission in the context of utilization of unutilized credit. - Matter remanded :
CHENNAI CESTAT
Bharat Oman Refineries Ltd Vs CCE
Central Excise - Registered
premises - appellant, manufacturer of petro products, filed an application to
amend their approved ground plan of Central Excise registration to include the
pipeline laid down from Wadinar (Gujarat) state to the refinery at Bina (M.P.),
on the ground that the pipelines laid down on various parts of the land and
areas in India/used for the ground pipelines were forming of integral part of
premises of the refineries - request rejected on the grounds inter alia that
the various locations of the pipeline are outside the jurisdiction of Central
Excise Division, Sagar; that in terms of Rule 9 of Central Excise Rules, 2002,
permission as regards registration of the manufacturer is restricted to the
premises where manufacturing activity is being carried out; that the activity
of lying and jointing of pipes does not come under the purview of manufacture
of excisable goods; and as such the location of pipelines which runs from
Gujarat State to M.P. cannot be regarded as precinct of the noticees refinery -
same upheld by Commissioner (Appeals) and agitated herein.
Held: A combined reading of
statutory definitions of factory and manufacture in Sections 2(e) and 2(f) of
the Central Excise Act 1944, makes it clear that while obtaining registration
for carrying out any manufacturing activity, the approval of the ground plan
would relate to manufacturing premises or factory - In various judicial
pronouncements, the factory premises and precincts have been interpreted to mean
all building or complex with its surroundings where manufacturing activity is
taking place - The transportation of the crude oil through the pipelines which
travel through various States of India cannot be held to be a process
integrally connected with the final manufacturing so as to include the same
with the refinery functions - definition of factory covers the premises and
precincts of factory and not the premises or precincts beyond the factory
premises and a dam reservoir located away from the factory cannot be treated as
within the factory premises - in the present case, it is seen that the
pipelines laid down beneath the land for transportation of the crude travel
through various States and is primarily meant for transportation of the raw
material - The entire area of the pipeline is around 900 Kms. of length - To
allow the registration of the same by holding the same to be a factory premises
or precinct thereof would mean allowing the road area used by transportation of
the raw materials by a truck - no justification in the above prayer of the
appellant. - Appeal rejected : DELHI CESTAT
Singla Forgings (P) Ltd Vs CCE
Central Excise – CENVAT credit –
Appellant firm, engaged in manufacture of MV Parts, availed credit on invoices
issued by HSAL without physical receipt of material, evidenced in proceedings
against HSAL - investigations were conducted at the appellants end wherein the
authorised signatory admitted that they have availed the Cenvat credit against
eight invoices of M/s HSAL, without receiving the goods physically; that it was
erroneous credit and voluntarily debited Cenvat Credit involved – demand for
recovery adjudicated with interest and penalty on firm and individual, payment
appropriated; upheld by Commissioner (Appeals) and agitated herein.
Held: investigations conducted at
the end of the manufacturer, transporter as also the appellant resulted in
emergence of evidence clearly pointing out to the fact of wrong availment of
credit – irrefutable conclusion that the appellant had taken the credit on the
basis of the Cenvatable invoices issued by M/s HSAL, without actually receiving
the goods – case law relied upon by appellants stand distinguished - no merits
in the appellants contention as regards the demand being barred by limitation -
fraud committed by the appellant stands unearthed by the Revenue only at the
time of exhaustive investigation, hence longer period of limitation is rightly
invoked by the Revenue - fact of payment of the Cenvat credit by reversing the
entries in the Cenvat account before the issuance of the Show Cause Notice is
not sufficient to accept the appellants contention that no penalty should be
imposed - In cases of fraud, mere deposit of the duty before the issuance of
the Show Cause Notice is not sufficient for non-invocation of the penal
provision - no merits in the present appeals. - Appeals rejected : DELHI CESTAT
Vandana Dyeing Pvt Ltd Vs CCE
CE - Appellant receiving fabrics
[Chapter 52, 54, 55 & 58 of the CETA, 1985] under rule 4(5)(a) of CCR, 2002
and undertaking the process of washing and stentering and thereafter returning
the goods to supplier of fabrics - department of the view that since stentering
amounts to manufacture appellant as a job worker should have discharged excise
duty liability - duty demand confirmed by lower authorities - appeal to CESTAT.
Held: Liability to pay duty in respect of goods moved under rule 4(5)(a) of CCR
is on the supplier of the goods and not on the job worker - notwithstanding the
fact that the processed fabrics are not included in notfn. 214/86-CE, job
worker is not liable to discharge CE duty and any liability thereon is to be
discharged by supplier of raw materials - rule 4(6) of the CCR makes it
abundantly clear that if the goods are to be cleared from job worker's premises
instead of being returned to supplier, then Commissioner can direct clearance
on payment of duty from job worker's premises and this would indicate that
liability to discharge duty under rule 4(5)(a) is on supplier and not on the
processor of goods - order is not sustainable in law and merits, hence set
aside - Appeal allowed: CESTAT - Appeal allowed
:
MUMBAI CESTAT
Zuari Cement Ltd Vs CCE, C &
ST
Central Excise - Clearance of
goods - Appellant, manufacturer of cement, cleared cement in bulk to consumers
like Contractors, Apartment Builders, Developers, Construction Companies - In
view of the decision of High Court, the consumers in question are considered as
industrial/institutional consumers in terms of Legal Metrology (Packaged
Commodities) Rules, 2011 - Matter remanded to Commissioner for fresh
consideration - Appeal disposed of. - Appeal disposed of : BANGALORE
CESTAT
Senor Metals P Ltd Vs CCE &
ST
CE - Appellant, in addition to
manufacturing their own products is also undertaking job work of other parties
who are availing the benefit of SSI exemption notfn. 8/2003-CE, dt. 01.03.2003
- For the job work activities, brass scrap is received by the appellant under
challans in terms of Notfn. 83 & 84/1994-CE, dt. 11.04.1994 - Revenue
alleging that billets/bars, which come into existence in the factory premises
of the appellant, are not specified goods under notification no.8/2003-CE and
hence the benefit of exemption notifications no.83 & 84/1994-CE will not be
available - Demand confirmed by CCE, Rajkot - appeal to CESTAT - Appellant
submitting that as per the undertakings given by the suppliers of the raw
materials the entire duty liability of the goods manufactured by the appellant
is required to be discharged by the supplier of the raw material and no duty
can be demanded from the appellant; that intimations filed with the
jurisdictional CE authorities by the raw material suppliers and also the
challans under which the raw materials were received and the finished specified
goods supplied back to the raw material suppliers; that periodical returns were
filed and hence demand time barred. -
Appeal dismissed : AHMEDABAD CESTAT
Stan Commodities Pvt Ltd Vs CCE
& ST
Central Excise - Application
seeking restoration of appeal dismissed earlier on the ground that no
communication of hearing was received from the Tribunal - From the records, it
is seen that the letters/communications had been issued from time to time by
the Registry on the address mentioned in the EA-3 Appeal Form and the same were
not returned, as undelivered, by the postal authorities - No substance in the
argument of the appellant that they have not received either the notices of
hearing or the orders from the registry, for the simple reason that they had
received the subsequent communication sent to them in August, 2013 on the same
address mentioned in the EA-3 Appeal Form - Section 37C lays down about the
procedure for service of decisions/orders, summons etc. In the present case,
the notices/orders were dispatched, following the procedure laid down under
Section 37C and the same were not returned by the postal authorities as
undelivered. Hence, the orders were delivered/communicated to the Applicant -
No merit in the application. -
Application dismissed : KOLKATA CESTAT
CCE Vs Indian Oil Corporation Ltd
CE - Valuation - s.4 of CEA, 1944
- Import Parity Price is not an artificially fixed price - It is an actual
price at the time and place of import which is also place for the sales
effected by the Refinery or OMC to another OMC - To say that such a price is an
artificially fixed notional value is completely contrary to facts - Import
price cannot be influenced by the marketing companies situated in India -
Therefore, there is a major flaw in the reasoning adopted in the order relied
upon by the Revenue - import price agreed between one OMC and another based on
the MOU reached between them can be considered as a transaction value - Order
of Supreme Court in case of HPCL prevails over all other decisions - Revenue
appeal dismissed: CESTAT - Appeal dismissed :
MUMBAI CESTAT
Premium Bars Pvt Ltd Vs CCE &
ST
CE - Clandestine removal - Excess
stock of Raw material and shortage of finished goods coupled with seizure of
un-accounted cash of Rs.22.5 lakhs at the residential premises of Director are
facts which do indicate that appellant company was indulging in duty evasion -
allegation of duty evasion of Rs.1,98,10,357/- against the appellant company is
not merely based on oral evidence but is also based on the documents recovered
from factory premises of PBPL and also from the premises of their raw-material
suppliers and their customers - apart from the monies paid and cash seized,
appellant directed to make a further deposit of Rs.44 lakhs for obtaining stay:
CESTAT - Pre-deposit ordered : DELHI CESTAT
Rane Engine Valve Ltd Vs CC, CE
& ST
Central Excise – CENVAT Credit –
Eligibility – Revenue denied the CENVAT credit availed by appellant's
manufacturing unit of automobile parts in respect of the input services –
Commissioner (A) rejected appellant's appeal for non-compliance with
pre-deposit order – In view of the several decisions of various High Courts and
Tribunal, appellant is prima facie eligible for the credit on the input
services – Matter remanded to Commissioner (A) for fresh consideration without
insisting on pre-deposit – Appeal disposed of. - Appeal disposed of : BANAGALORE CESTAT
CCE Vs Gupta Coal Field &
Washeries Ltd
CENVAT – Credit taken of service
tax paid on services of Road construction, photocopying, fees for valuation of
construction, fees for rating for bank loan, excavation of pond, insurance
policy for employees, JCB piston repairing, security charges on railway siding,
transportation of coal from plant to railway siding are Input Services as they
have been availed by the respondent for their activity of coal washing – there
is no doubt that all the services availed by the respondent are for the
activity of coal washing only – respondent is entitled for CENVAT credit of
service tax paid on these services – no infirmity in order of Commissioner (A)
– Revenue appeal dismissed: CESTAT -
Appeal dismissed : MUMBAI CESTAT
Rasi Tex (India) Pvt Ltd Vs CCE
Central Excise – Condonation of
Delay (COD) – application pleading that the Manager who handles this case had
received the impugned order and left the service without handing over case
papers to his successor.
Held: Reason for delay is the
misplacement of the record by the employee of the appellant Company - It is not
the case of the applicant that the Manager had left the Company with the case
file; it is the duty of the successor to trace the files lying in the office -
applicant appeared in personal hearing before the Commissioner (Appeals); thus,
they were well aware of the proceeding - There is a gross negligence and
inaction on the part of the applicant - Allahabad High Court in the case of
Prem Heavy Engineering Works dismissed the application filed by the assessee of
a delay of 41 days in filing the appeal before the Tribunal for the reason that
the Managing Director of the Company was the only responsible officer left in
the factory due to sickness - It is consistently held by the High Court and the
Tribunal, that the delay cannot be condoned for the same reason that the record
was misplaced by the employee of the company - no substance in the application
filed by the applicant; accordingly, COD application is rejected. - Appeal dismissed :
CHENNAI CESTAT
Sun Pharmaceuticals Industries
Ltd Vs CCE & ST
CENVAT - Excess amount of credit
reversed at the time of removal of inputs ‘as such' cannot be adjusted against
instances where lesser amount was required to be reversed - proper procedure is
to file refund claim - appellant has not made out a case for waiver -
pre-deposit ordered of Rs.60,000/-: CESTAT - Pre-deposit ordered : AHMEDABAD CESTAT
Vapi Paper Mills Ltd Vs CCE
Central Excise - Penalty - common
issue involved in these appeals is regarding imposition of penalties under Rule
25 for violating the provisions of Rule 8 of Central Excise Rules, 2002;
disputed by Party and Revenue on imposition / non-verification respectively,
herein.
Held: Appellant-assessee has paid
the amount through PLA along with interest - If the said duty liability which
has been fastened on him for making payment through PLA is discharged along
with interest, the provisions of Rule 8(3) have been more or less complied with
- In terms of Gujarat HC ruling in Saurashtra Cements case, appeal allowed to
the extent of penalty under Rule 25 - however, appellant liable to be penalized
under Rule 27 of Central Excise Rules, 2002 - Revenue's appeal is devoid of
merit as the appellant has already made the payment due to the Central
Government along with interest; hence rejected. - Appeals disposed of : CESTAT AHMEDABAD
Chief Workshop Manager Central
Workshop Southern Railway Vs CCE
CE - Condonation of delay of 413
days - delay is on account of obtaining requisite departmental approval from
higher authorities for filing appeal – such a reason cannot be accepted as
sufficient cause for condoning the delay - COD applications rejected and
appeals dismissed: CESTAT -
Appeal dismissed : CHENNAI CESTAT
Ultra Tech Cement Ltd Vs CCE
CENVAT credit – Cement received
through water channel at Navi Mumbai from mother plant located in Gujarat –
Cement cleared from mother plant on payment of duty as per weighment done there
– goods later shipped to JNPT and the cement was unloaded into road tankers
which carried the cement to appellant's factory at Navi Mumbai – loaded tankers
were weighed at weighbridge before and after unloading the cement – difference
in weight of cement – on occasions it is in excess and sometimes there is short
receipt – department denying credit when cement short received – appellant
submitting that the maximum difference works out to 2% and which is only a
mirage difference – denial of CENVAT credit – appeal to CESTAT. Held: there is
no allegation that goods have been diverted during transit or there is any
pilferage of the goods during the course of transportation – if the appellant
had not weighed the inputs in their factory they were entitled to take credit
on the quantity shown in invoice – loss occurred only due to the various
methods of weighment – CENVAT cannot be denied – orders set aside and appeals
allowed with consequential relief: CESTAT - Appeals allowed : MUMBAI CESTAT
Oriental Containers Ltd Vs CCE
CENVAT – Credit of duty paid on
Outward transportation service – Karnataka HC in case of ABB Ltd. - allowing
credit but there is a contrary decision of Calcutta HC in Vesuvious India Ltd.
- in view of two contrary decisions, applicant has made out a case for 100%
waiver of pre-deposit – pre-deposit waived and stay granted: CESTAT- Stay granted :
MUMBAI CESTAT
Mainetti (India) Pvt Ltd Vs CCE
Central Excise - Stay /
dispensation of pre deposit – Refund/Rebate under Rule 18 of the Central Excise
Rules 2002 – Appellant cleared credit availed material to their SEZ Unit,
reversed corresponding credit under Rule 3(5) of Cenvat Credit Rules 2004 and
claimed rebate – rebate sanctioned in adjudication, agitated by Revenue, set
aside by Commissioner (Appeals), now agitated by appellant herein.
Held: Rule 18 provides for rebate
of duty paid on excisable goods or duty paid on clearance in the manufacture of
processing of such goods - the applicant claimed rebate on the duty paid as
input credit in the raw materials which is prima facie covered by Rule 18 of
the said Rules - Accordingly, predeposit of duty is waived and its recovery is
stayed till disposal of appeals.-
Stay granted : CHENNAI CESTAT
Roca Bath Room Products Pvt Ltd
Vs CCE
Central Excise - Stay /
dispensation of pre deposit – Demand – applicant, manufacturer of POP Moulds,
cleared them for captive consumption and claimed exemption under Notification
No.67/95-CE, dated 16.03.1995 – after goods were repeatedly used it was cleared
as waste and scrap of POP moulds – Revenue viewed that they are treatable as
moulds and not waste/scrap, confirmed demands agitated herein.
Held: on an identical issue the
Tribunal granted unconditional stay in the applicant's own case for the earlier
period vide Misc. Order No.41435/2013, dated 22.05.2013 – impugned POP moulds
cannot be treated as duty paid capital goods and prima facie, Rule 3(5A) of
Cenvat Credit Rules, 2004 would not apply – JNM Fibres decision relied upon by
Revenue distinguished in context - Tribunal consistently granted stay on
similar issue - pre-deposit of duty along with interest and penalty waived,
demands stayed till disposal of the appeal.- Stay granted : CHENNAI CESTAT
CUSTOMS
Qimiti Lal Sharma Vs CC
Customs – Penalty - primary
allegation of Revenue is that the CHA appellant Qmity Lal was involved in the
mis-declaration of export to enable the exporter to make fraudulent claim of
DEPB benefit for which he was bound to suffer penalty. Held: Impugned order
reveals that one Shri Vijay Madaan who was representative of CHA appellant had
forged signatures and also substituted antedated documents to defraud Revenue,
apparently with connivance of some of the customs officers - no evidence to
show that the appellant was innocent - Customs area is a sensitive place where
the protection of Revenue as well as security of the country is involved -
matter sent back to Adjudicating authority to make a full inquiry as to
ascertain who had forged the signatures and who were involved in antedating the
documents and issuing summons to Qimiti Lal Sharma and also Vijay Madaan shall
discover the truth behind the scene - appellant directed to appear and
participate in the inquiry as well as re-adjudication of the matter - authority
shall take into consideration the result of his enquiry before passing the
order confronting the same to the appellant. - Matter remanded : DELHI CESTAT
CCE Vs Hi-Tech Medical Products
Ltd
Cus - Allegation of contravention
of conditions of LOP and contravention of the provisions of Customs (Import of
goods at concessional rate of duty for manufacture of excisable goods) Rule
1996 & duty involved in imported raw material i.e. cannulae demanded - when
the unit was de-bonded on 25.3.2004 and no objection certificate was issued by
the department there was no dues pending against the assessee - on this ground
as well as on limitation, Revenue's appeal was rightly rejected by Commissioner
(Appeals) – Revenue in appeal before CESTAT. - Matter remanded : DELHI CESTAT
Unison Hotels Ltd Vs CC
Customs – Condonation of delay
& Stay / dispensation of pre deposit – Appellant Hotel imported BMW 730 LD
Limousine cars under EPCG Scheme vide Notification No.97/2004-Cus. dated
17.09.2004 – Investigation revealed that the cars were deployed for private
use; applicant had not maintained any log book and failed to produce any
evidence that any payment was received in freely convertible foreign currency –
cars seized, confiscation, RF option, duty demand with interest and penalties
on Hotel and individual adjudged; now agitated herein.
Held: applicant inadvertently
filed the appeal in the O/o Commissioner (Appeals) within the statutory time;
subsequently filed with Tribunal on realizing error - delay in filing the
appeal condoned.
EPCG Scheme provides that the
vehicle imported is to be used for tourist purposes only - Clause (4)(ii) of
Para 5 of Notification No.97/2004-Cus requires earnings in foreign exchange -
Prima facie, no material available to evidence that the imported cars were used
for tourist purposes - there is violation of exemption notification as the
applicant failed to produce any evidence that the payments were received in
freely convertible foreign currency for services rendered to use of the cars -
no prima facie case made out for waiver of pre-deposit of the entire amount of
duty along with interest and penalty – applicant directed to pre deposit entire
amount of duty, Revenue to encash bank guarantee to that extent within six
weeks – upon compliance, predeposit of balance waived and recovery of dues
stayed during pendency of appeal. -
Pre deposit ordered : CHENNAI CESTAT
Srithai Superware India Ltd Vs CC
Cus - Commissioner (Appeals) has
not followed the law to decide the appeal - An appellate Commissioner has to
first determine the points in dispute which is normally called as issues to
proceed with the appeal - Unless he lists the issues, it is difficult to
understand what was in controversy and how appellate authority addressed the
wrong done to the aggrieved - That shall not be known to law - No doubt there
may be case for Revenue but by one sentence, the appeal of Revenue cannot be
allowed - It appears that the respondent was altogether deprived from the
process of justice and in absence of recording the arguments and evidence of
the respondent, the order cannot be said to be the order passed by application
of mind - To cure the defect as above, which is touching the root of the matter
and violation of natural justice being patent, is incurable at the appellate
stage, matter remanded: CESTAT - Appeal allowed by way of remand : DELHI CESTAT
CP Aqua Culture India Pvt Ltd Vs
CC
Customs – Refund – Appellant, a
100% EOU, exported shrimp during 2001-02 and paid cess under the Agricultural
Produce Cess Act, 1940 – Later claimed exemption under Notification No.
451/2001 dated 30.6.2001 and sought refund of cess already paid, on 29.04.2004
– claim rejected in adjudication on the ground that it is hit by limitation
under Section 27(1)(b) of the Customs Act, 1962 and also on the ground of
unjust enrichment; rejection upheld by Commissioner (Appeals) and agitated
herein.
Held: Force in Revenue's
contention that refund claim was filed on the basis of the exemption
Notification No. 451/2001 dated 30.6.2001 which would be governed by Section 27
of the Customs Act, 1962 and accordingly, both the authorities below had
rightly rejected the refund claim on the ground of time limit and unjust
enrichment - However, subsequent development in this matter as decided by High
Court and the Tribunal that Prawns and Shrimps are not fish and is not covered
to the Schedule of the said Cess Act, 1940, requires to be examined by the
lower authority in the interest of justice - adjudicating authority directed to
examine the refund claim in the light of the High Court ruling in accordance
with law, after providing reasonable opportunity of hearing to the appellant before
passing an order. - Matter remanded :
CHENNAI CESTAT
CC Vs Advance Components Engg.
Customs – EOU - De-bonding –
Depreciation on the value of capital goods imported but not used fully for the
purpose of manufacture so as to discharge export obligation: , while respondent
has target of one lakh pieces to export, it exported 300 pieces during the
entire export period. Upon debonding of unit, Adjudicating authority allowed
depreciation on the value of capital goods imported.
Held: depreciation is admissible
once there was export obligation discharged even partly irrespective of quantum
of export made in absence of any clause in the notification for disallowance
against partly discharge of export obligation. Therefore there shall be
allowance of depreciation on the capital goods imported to calculate the value
thereof for the purpose of recovery of duty foregone. Respondent shall be
entitled to depreciation.
Matter remanded to calculate
quantum of depreciation. -
Appeal disposed of: DELHI CESTAT
Proflex Systems Vs CC
Customs – Refund – claims filed
under Notification No. 102/2007-Cus, dt.14.09.2007 rejected primarily on the
ground that the imported goods are not sold as such and thus appellant is not
eligible to refund; agitated herein.
Held: Issue involved in the
present appeals is whether the appellant is entitled to the refund of Special
Additional Duty (SAD) paid at the time of import under Section 3(5) of Customs
Tariff Act, 1975 as per cited notification – Under Clause 2(d) of the
notification, importer is required to pay sales appropriate sales tax or value
added tax on subsequent sales of the imported goods - From the working
arrangement between applicant and customer, it is seen that quantity of
imported goods used or sold is not known till the completion of the contracted
work (Roof) - In the final invoices also, it is not separately shown as to how
much quantity of imported goods have been sold to the clients; unused quantity
of material/wastage also remains the property of the appellant - The rate of
laying of 'Proflex Roof' is also charged on per square meter including the
value of the materials, and final retail invoice is issued after completion of
work when the imported goods are not at all existing in the form they were
imported - When the deemed sale of the material takes place, the imported goods
do not exist as such but what exists is the 'Proflex Roof' - facts of the
present case different from the facts of the case before Gujarat High Court in
the case of Posco India Delhi Steel Processing Centre - the relied upon case
law inapplicable to the facts & circumstances of the present appeals. - Appeals rejected :
AHMEDABAD CESTAT
J U Pesticides & Chemicals
Pvt Ltd Vs CC
Customs - Stay / dispensation of
pre deposit - Classification - Applicant imported pesticides in bulk and
classified it under Chapter 29, declined by Revenue, viewing that the goods
fell under chapter 38 - duty demand adjudicated; Commissioner (Appeals)
dismissed case for non-compliance of stay order; and agitated herein.
Held: Issue covered by the Apex
Court ruling in the Pesticides Manufacturing & Formulations Association
case - judgment held that technical grade pesticides in bulk form are covered
under Heading 38.08 - goods in question are technical grade pesticides in bulk
form - applicants failed to make out a prima facie case for waiver of
predeposit of entire dues; hence directed to predeposit the entire amount of
duty within a period of eight weeks - upon compliance, predeposit of the
balance dues stands waived and recovery thereof stayed during the pendency of
the appeals. - Pre deposit ordered : CHENNAI CESTAT
CC Vs Shilpa Trading Company
Cus – Undervaluation – Tribunal
holding that no redemption fine is imposable when the bond and bank guarantee
executed by the assessee has already been cancelled – Revenue in appeal.
Held: It
is clear that when goods are liable for confiscation, and confiscated and
released to the assessee on his executing a bond or bank guarantee, the
proceedings are concluded holding that if there is a violation of the
provisions of the Act, then the order of confiscation has to follow as a matter
of course - As the goods are already released in favour of the assessee instead
of again taking possession of the confiscated goods, the law provides for
payment of fine in lieu of confiscation which is popularly known as redemption
fine - Therefore, whether the bond executed by the assessee is in force;
whether the bank guarantee executed for due compliance of the bond is in force
or not; whether goods are in possession of the authority or not; whether the
goods in existence or not on the day when order was passed is totally
irrelevant – Order of Tribunal set aside and Revenue appeal allowed: High Court
Confiscation - Question for
consideration is whether the assessee has contravened the law and the goods are
liable for confiscation - Once that finding is recorded in lieu of confiscation
of the goods an option is given to the assessee to pay confiscation fine i.e.,
redemption fine to retain the goods - In that view of the matter, the finding
recorded by the Tribunal runs counter to the judgment and law laid down by the
Apex Court in the case of Weston Components Ltd., - impugned order cannot be
sustained: High Court - Revenue appeal allowed : KARNATAKA HIGH COURT
CA Gopal Kumar Kedia
Ph.: 9810131451
Email : gopal@gkkedia.com
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