SUMMARY FOR THE MONTH OF FEBRUARY

(1^st February to 15^th February)

 

1^st Feb

 

2016-VIL-58-P&H

PUNJAB STATE POWER CORPORATION LIMITED Vs THE STATE OF PUNJAB

Punjab Value Added Tax - Validity of Section 62(5) - Pre-deposited - validity of condition of 25% pre-deposit of tax precedent for hearing of an appeal - Power of first appellate authority to grant interim protection against imposition of condition of pre-deposit for hearing of appeals on merits - right of appeal and pre-deposit - HELD - right of appeal being a statutory right, it is for the legislature to decide whether to make the right subject to any condition or not - perusal of sub section (5) of Section 62 of the PVAT Act shows that pre-deposit of twenty five percent of the total amount of tax, interest and penalty is a condition precedent for hearing an appeal before the first appellate authority. Any challenge to the constitutional validity of this provision for pre-deposit before entertaining an appeal on the ground that onerous condition has been imposed and right to appeal has become illusory must be negatived and such a provision cannot be said to be ultra vires Article 14 of the Constitution of India - the State is empowered to enact Section 62(5) of the Act and the said provision is legal and valid. The condition of 25% pre-deposit for hearing first appeal is not onerous, harsh, unreasonable and violative of the provisions of Article 14 of the Constitution of India - the power to grant interim injunction/protection is embedded in Section 62(5) of the PVAT Act. Instead of rushing to the High Court under Article 226 of the Constitution of India, the grievance can be remedied at the stage of first appellate authority - the provisions of Section 62(5) of the PVAT Act are directory in nature meaning thereby that the first appellate authority is empowered to partially or completely waive the condition of pre-deposit contained therein in the given facts and circumstances - Partial or complete waiver will be granted only in deserving and appropriate cases where the first appellate authority is satisfied that the entire purpose of the appeal will be frustrated or rendered nugatory by allowing the condition of pre-deposit to continue as a condition precedent to the hearing of the appeal before it. Therefore, the power to grant interim protection/injunction by the first appellate authority in appropriate cases in case of undue hardship is legal and valid - Writ petition disposed

 

2016-VIL-93-CESTAT-MUM-CE

M/s CIPLA LTD Vs COMMISSIONER OF CENTRAL EXCISE, MUMBAI-III

Central Excise - Valuation - Refund on account of quantity discount - manufacture of P&P Medicines - appellants seeking refund on the ground that the assessable value for the purpose of assessment should be the value arrived at after giving the quantity discount and not the value at which the goods was cleared from factory to depot - Denial of refund - HELD - whereas the clearances from the factory gate are governed by Section 4 of the CEA, 1944, the clearance from depot are governed by the Rule 4 of Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 - if in this case during the period of dispute there were quantity discount schemes and the quantity discounts were given at the time of sale from depot, the same would have to be allowed, even if Central Excise invoices issued at the time of clearance of the goods from the factory do not mention the quantity discount, as the same can be mentioned only when the goods are sold from the depot. For permitting the deduction of quantity discount, what should be known and understood prior to sale is the quantity discount scheme or policy and not the exact quantum of quantity discount available to a buyer based on the discount scheme, which would be known only at the time of sale or at the end of the period specified in the discount scheme of the quantity discount is based on the quantity purchased by a buyer during a specified period - The impugned order is set aside assessee appeal allowed

 

2016-VIL-91-CESTAT-MUM-ST

COMMISSIONER OF CENTRAL EXCISE & SERVICE TAX (LTU) MUMBAI Vs M/s RELIANCE INDUSTRIES LTD

Service Tax - Supply of tangible goods for use service - designated areas in the Continental Shelf and Exclusive Economic Zone of India - installations, structures and vessels - exploration and extraction of oil and gas in the offshore Blocks - HELD - Notification 21/2009 extends the taxable territory only to constructed installations and structures and not to under-construction installations. Therefore services provided to latter are not taxable - The 'structures' referred to in Notification 21/2009 are complete structures - Services provided by vessels traversing to and fro from shore to off shore and in the EEZ are not taxable under the provisions of Not 21/2009 - Notification 21/2009 extends taxable territory to installations etc in the CS and EEZ in contradistinction to Not 14/2010 which also extends the taxable territory to the whole of the sea-bed and thus the services provided to the sea-bed are not taxable as held by the Hon'ble High Court of Bombay in Greatship India Ltd - Services provided in taxable territory alone are taxable as laid down in the judgements in the case of All India Federation of Tax Practitioners vs Union of India and Cox and Kings India Ltd. Resort to Taxation of Services (Provided from Outside India and Received in India) Rules, 2006 is not warranted in the circumstances except in case of services, namely "Commercial Training and Coaching service" and "Management Consultant Service" - Appropriate interest on demand confirmed in respect of these two services is payable. However no penalty is imposable - Assessee appeal partly allowed

 

2016-VIL-92-CESTAT-AHM-CU

THE GREAT OFFSHORE LTD Vs COMMISSIONER OF CUSTOMS, KANDLA

Customs - Confiscation of vessel and imposition of redemption fine and penalty - sale of foreign going vessel to an Indian entity - failure to amend IGM and file Bill of Entry - HELD - Department was aware of the irregularities committed by the Appellant at the time of first proceedings, wherein the Appellants were allowed to file Bill of Entry. It also appears that penalty was imposed at that time. Therefore, not amending the IGM amounts to only a technical offence, which calls for token penalty and token fine only, under the peculiar facts and circumstances of the case. Therefore, while upholding the impugned order, redemption fine and penalty is reduced - appeal is allowed

 

2016-VIL-57-GUJ-CU

KRISHNA CLEARING AGENCY Vs UNION OF INDIA

Customs - penalty on partner and employee - Commissioner (Appeals) order in respect of co-noticee - HELD - The Commissioner (Appeals) in absence of other noticees could not have disturbed the order of Commissioner - without any appeal being filed by the Department, it is questionable whether the Commissioner could have taken such a step. Secondly, in any case, without any notice, the other noticees had earned the verdict of dropping the proceedings. The appellate Commissioner could not have disturbed such order which would be plainly opposed to the principles of natural justice - impugned order in respect of co-noticee is quashed on the grounds of non-hearing of the concerned petitioners and on the appellate Commissioner having passed an order against the parties who were not respondents before him - petition disposed

 

dgftNoti35

DGFT: Amendment in Para 5.01(g) of FTP 2015-2020 - Import of Capital Goods is not permitted under EPCG Scheme for generation/transmission of power

 

Summary for the month of January: List of updates from 16th January to 31st January

 

2^nd Feb

 

rajCir10

Rajasthan: Information to be submitted by e-Commerce companies

 

rajCir11

Rajasthan: Regarding clarification of Tax Deduction At Source (TDS) by an Awarder under Rule 40 of RVAT Rules, 2006

 

ceNoti01NT

Ceentral Excise: Amendment in CENVAT Credit Rules, 2004 - Rule

 

ceCir1014

Central Excise: Inclusion of show cause notice's issued in relation to levy of CVD on vessels imported for breaking in the "Call-Book"

 

cuNoti17NT

Customs: Rate of exchange of conversion of the foreign currency with effect from 2nd February, 2016

 

 

delNoti1405

Delhi: Extension in date for submission of Form DP-1

 

dgftPN58

DGFT: Amendment in ANF 2A of Appendices and Aayat Niryat Forms (2015-2020)

 

2016-VIL-60-MAD

MI STEEL PROCESSING INDIA PVT LTD Vs THE ASSISTANT COMMISSIONER (CT), KANCHEEPURAM

Tamil Value Added Tax Act - Section 13 - deduction of TDS - appeal on account of non-deduction of TDS - petition seeking refund of pre-deposit pursuant to Single Judge order - maintainability of petition - when the appeal is dismissed on the ground of lack of jurisdiction whether the appellate authority as well as the writ Court is justified in not ordering return of the amount is the issue canvassed in this appeal - HELD - If the appeal had been dismissed on the merits of the matter, then the appellant may or may not be entitled to ask for return of the deposited amount depending upon the context under which he was asked to deposit the amount - When the appellate authority held that there is no jurisdiction to adjudicate on the issues raised, then the consequential orders passed are also without jurisdiction and it is a nullity. It is settled law that any order passed without jurisdiction is non-est in the eye of law. Therefore, the appellate authority-respondent should have ordered the return of amount which was already paid by the appellant - the claim of the appellant that the learned single judge ought to have specifically directed the second respondent to return the amount is correct and it has to be accepted - the writ appeal is partly allowed

 

2016-VIL-59-MAD

DHANASELVI ENTERPRISES Vs THE COMMERCIAL TAX OFFICER

Tamil Nadu Value Added Tax Act - Section 19(20) - Turnover - levy of tax on incentives and discount offered to dealer - HELD - The constitutional validity of Section 19(20) of the TNVAT Act has already been upheld by this Court. The finding of the Assessing Officer is that discount by any other name, it may be called, such as, commission, gift, will, squarely falls under Section 19(20) of the Act and therefore, the discount is also liable to be taxed. This finding is based on facts - The grievance of the appellant is that when the Companies similarly placed have been granted benefits of exemption from the tax on discounts, the appellant alone cannot be singled out without any basis and not even affording an opportunity of personal hearing - the impugned order is set aside - The matter is remitted back to the respondent. The respondent shall offer personal hearing to the appellant

 

CENTRAL EXCISE SECTION

 

2016-VIL-94-CESTAT-DEL-CE

M/s WINSOME SPINNER Vs COMMISSIONER OF CENTRAL EXCISE, CHANDIGARH

Central Excise - Majority order - 100% EOU - Whether non-accountal in statutory records but accountal in gate register and Form IV, etc. could be considered as due compliance for accountal of duty free receipts of goods and not liable to imposition of redemption fine and penalty or whether non-accountal in statutory records but accountal in gate register is not to be considered as due accountal of duty free receipt of goods and thus liable to imposition of redemption fine and penalty - Notification No.52/2003-Cus - HELD - the condition 3(b) of the Notification No.52/2003-Cus requires the appellant to maintain a proper account for the receipt, storage and utilisation of the said goods - appellant's contention that the goods were not entered in the re-warehousing register as re-warehousing had not been completed is not unreasonable. However, it comes out that the goods were not only entered in the gate register but also entered in the raw-material register. In addition, it is not a case that there was any shortage noticed - also, these goods are imported only after a certificate authorising their import is given by a central excise officer and thus, the central excise officers are in the know of the duty free imports authorised by them for the 100% EOU - Thus taking into account the entire matrix of facts and circumstances, the assessee is not liable to imposition of redemption fine and penalty - the impugned order is set aside and the appeal is allowed

 

2016-VIL-95-CESTAT-MUM-CE

PRECISION METALS Vs COMMISSIONER OF CENTRAL EXCISE, RAIGAD

Central Excise - Rule 3 of the Cenvat Credit Rules - wrong availment of credit of service tax paid to foreign entity - penalty under Rule 15(2) of the CCR, 2004 r/w Section 11AC of the CEA, 1944 - HELD - there is no allegation regarding fraud, wilful misstatement, suppression of fact which are required as per Rule 15(2) r/w Section 11AC of the Central Excise Act to impose equal amount of penalty - once the interest part was dropped by the Commissioner (Appeals) and there are no allegations of suppression and no categorical finding on the requirement of Section 11AC, then the imposition of penalty is wrong and illegal - impugned order set aside and assessee appeal is allowed

 

CUSTOMS SECTION

 

2016-VIL-99-CESTAT-DEL-CU

M/s STJ ELECTRONICS PVT LTD Vs CC (I&G), NEW DELHI

Customs Tariff - Classification of Finger Print Reader-Scanner - revenue contends to classify under Customs Tariff heading 8543, as against the classification claimed by the appellant under CTH 8471 on the ground that the goods were optical readers and hence clearly covered under CTH 8471 - HELD - the machine essentially performs data processing function inasmuch as it processes the data relating to fingerprint with the finger print data in the motherboard / Centre processing unit (CPU). Thus, it does not have any specific function other than data processing. The impugned goods are therefore not eased out of CTH 8471 by the provisions of Chapter notes 5(D) & 5(E) CTH 85.43 covers electrical machines and apparatus having individual functions, not specified or included elsewhere in chapter 85. Thus, this heading is a sort of residuary heading for the goods otherwise covered under chapter 85. As the impugned goods are found to be covered under CTH 8471, they are obviously out of chapter 85 and hence out of CTH 85.43 too - the impugned goods are classifiable under CTH 8471; that they are so classified in some Customs Houses like Bombay and Chennai as per the data given by the appellant only reaffirms that those customs houses are correctly classifying the same - the impugned order set aside and assessee appeal allowed

 

2016-VIL-98-CESTAT-CHE-CU

TINNA RUBBER & INFRASTRUCTURE LTD Vs COMMISSIONER OF CUSTOMS, CHENNAI

Customs - Limitation - assessee appeal against order of Commissioner (Appeals) dismissing the appeal on limitation and has not discussed the merits of the case - appeal filed before Commissioner (Appeals) beyond the condonable limit of 30 days - HELD - The Hon'ble Supreme Court in the case of Singh Enterprises Vs CCE, Jamshedpur has dealt the issue at length and held the legislature intended the appellate authority to entertain the appeal by condoning delay only upto 30 days after the expiry of 60 days which is the normal period for preferring appeal. Therefore, there is complete exclusion of Section 5 of the Limitation Act - there was no power to condone the delay after the expiry of 30 days period - Appeal dismissed

 

SERVICE TAX SECTION

 

2016-VIL-97-CESTAT-DEL-ST

THE LAKE PALACE HOTEL AND MOTELS P LTD Vs COMMISSIONER OF CENTRAL EXCISE, JAIPUR-II

Service Tax - renting the hotel building on profit sharing basis - demand on account of renting of immovable property service and notional interest received on the security deposit - HELD - the appellant is not liable to pay service tax under the category of renting of immovable property service as leasing out the property to Hotel under the deemed provision of section 65 (105)(zzz) of the Finance Act, 1994 - appellant are also not liable to pay service tax on the notional interest accrued on the security deposit - the impugned order is set aside, appeal of the assessee is allowed and appeal filed by the Revenue is dismissed

 

2016-VIL-96-CESTAT-AHM-ST

CCE&ST, RAJKOT Vs M/s OYSTER MARITIME INDIA PVT LIMITED

Service Tax - non-payment of tax - levy of penalty under section 78 - HELD - assessee was aware of his responsibilities and procedures and non-payment of service tax on due dates were not a mistake - however, there is enough reason to view the non-payment of service tax on due dates by the Respondents leniently - the assessee have paid almost the entire amount of service tax due before issuance of show cause notice - the legislature in its wisdom has also amended the provisions of Section 78, albeit from 01.4.2011, that the penalty under Section 78 may be reduced to 50% when true and complete details of the transactions are available in the specified records - the equivalent penalty imposed under Section 78 of the Finance Act, 1994, is to be reduced to 50% of the same - As regards the penalty imposed under Section 76, the same is not imposable after 10.05.2008 as per the provisions itself as if the show cause notices are issued after the date of amendment, penalties under Section 76 and 78 simultaneously cannot be imposed - appeal partly allowed

 

bihNotiSO22

Bihar: Enhancement in Surcharge on HSD & Light Diesel Oil

 

tnNewProject

Tamil Nadu: Rollout of new 'e-C Tax' Project

 

cuNoti7

Customs: Amendment in Notification No. 12/2012-Customs dated 17.03.2012 - Omission of Wattle extract, quebracho extract & chestnut extract

 

dgftNoti36

DGFT: Amendment in policy condition No.9 of Chapter 87 of ITC (HS), 2012 -Schedule - 1 (Import Policy)

 

dgftPN59

DGFT: Addition of two Pre-Shippment Inspection Agencies (PSIA) in Appendix 2G at Sl. no. 36 and 37 upto 31.05.2016

 

TRPU

Government sets-up Tax Policy Research Unit and Tax Policy Council

 

FCP0102

Index of Eight Core Industries (Base: 2004-05=100) for December, 2015

 

3^rd Feb

 

2016-VIL-63-KAR

SRI ANJANEYA AGRO TECH PVT LTD Vs THE DEPUTY COMMISSIONER OF COMMERCIAL TAXES (AUDIT)

Karnataka Value Added Tax Act - assessee claimed of partial input rebate in terms of section 17 of the Act - plea for rectification of the re-assessment orders and grant of full input tax rebate in view of judgment in M.K. Agro Tech Pvt Ltd case - Denial of such request - whether the petitioner could avail the benefit of the judgment which was rendered much after the assessment order was passed and whether such reassessment orders can be passed on their prayer for rectification of the earlier assessment - HELD - in a situation where if the revenue were to be in the position of the assessee and if it was discovered that by virtue of the operation of law, the revenue was entitled to a certain amount from the dealers, it would have certainly turned the tables on the assessee and proceeding on that presumption, it would be only just and fair to direct the revenue to consider the prayer of the petitioner for rectification, when there is no dispute that they were entitled to full tax rebate by virtue of the decision in M.K. Agro Tech - The impugned orders are set aside with direction to the first respondent to give the petitioner the full benefit - respondent having challenged the judgment in M.K. Agro Tech before the apex court, there is no order of stay. Therefore, having regard to the law laid down by this court, the respondents are bound to comply - The petitions are allowed

 

2016-VIL-102-CESTAT-MUM-CE

ARBES TOOLS PVT LTD Vs COMMISSIONER OF CENTRAL EXCISE, MUMBAI-II

Central Excise - Penalty - Clearance of goods to own unit by issuing invoice instead of challan - failure to pay duty - imposed penalty under Section 11AC - HELD - the invoice clearly shows that though the duty has been charged, but the same was not deposited and that no sales tax is charged as the goods are being transferred to own - it appears that the goods were intended to be transferred to their own unit, but inadvertently instead of issuing challan, the appellant has wrongly issued the invoice - the appellant has paid the duty along with interest on being pointed out by the audit officer - when there is no intention to evade payment of duty on account of fraud, wilful misstatement, suppression of fact etc. as mentioned in Section 11AC, the penalty cannot be imposed - also, since in this case there is no determination of duty and in accordance with law as provided in sub-section (10) of Section 11A, therefore under Section 11AC, penalty cannot be imposed - Assessee appeal allowed

 

2016-VIL-61-BOM-CU

M/s AMRITLAKSHMI MACHINE WORKS Vs THE COMMISSIONER OF CUSTOMS (IMPORT)

Customs Act - Section 112(a) - Whether under the Act and particularly in exercise of the powers conferred by Section 112(a) thereof, simultaneous penalties on both the Partner and Partnership firm can be imposed - Majority Order - HELD - in such cases where the importer is a partnership firm inasmuch as it is in possession of IEC code number and has filed a Bill of Entry for the import of goods and the allegation is not of abetment but of doing an act or omitting to do an act which rendered the goods liable for confiscation. It has nothing to do with mens rea / knowledge. In such a case a penalty imposed upon the firm would be a penalty imposed upon all the partners of the firm as this has nothing to do with the knowledge of the breach rendering the goods liable for confiscation under Section 111 of the Act. It is a case of strict liability - if the Revenue seeks to impose a penalty upon the partner, then the notice must make out a case of knowledge on the part of the partner in his individual capacity so as to make it a case of abetment by the partner in respect of the acts and/or omission of the partnership firm. This is on a plain reading of Section 112(a) of the Act. This is so as the breach on the part of the partner concerned is independent of the breach committed by the firm - Penalty cannot be imposed on a partner ipso facto merely because penalty is being imposed upon the partnership firm under Section 112(a) of the Act - Partnership firm is not given a status of a separate legal entity in the absence of Section 140 of the Act. Thus, in the absence of invoking Section 140 of the Act, no separate penalties under Section 112 of the Act would be imposed simultaneously on firm and its partners - appeal disposed

 

2016-VIL-62-MAD-CU

UPS JETAIR EXPRESS PVT LTD Vs THE CHIEF COMMISSIONER OF CUSTOMS, CHENNAI

Customs - Courier Import and Export (Clearance) Regulations - false declaration and violation of Foreign Trade Policy and the Customs Act, 1962 - SCN for revoking registration of the Petitioner as an 'authorised courier' - alternative remedy - HELD - contentions of the Petitioner cannot be a basis to circumvent the appeal remedy available for the petitioner as per Section 129(A) of the Customs Act, 1962, since the said Section provides an efficacious alternative remedy before the Appellate Tribunal against the impugned order. There is also no justifiable grounds to bypass this appeal remedy - the issues are questions of fact and the allegations that the Petitioner had earlier involved around 85 times and illegally cleared such goods against the Regulations, have to be established by the Parties by producing records for examination by the appellate authority - since the disputed questions cannot be gone into by this Court, leaving it open to the Petitioner to avail the statutory appeal remedy provided under the Act, this Writ Petition is dismissed

 

2016-VIL-100-CESTAT-MUM-ST

MONARCH CATALYST PVT LTD Vs COMMISSIONER OF CENTRAL EXCISE, THANE-I

Service Tax - cenvat credit in respect of service tax paid to the commission agents based abroad - whether services rendered by the foreign based commission agent be stated to be input services within the meaning of such expression as defined under Rule 2(l) of the CCR, 2004 - HELD - services of commission agent abroad is input services as the commission agent procured the orders for the appellant and thereafter the appellant manufactured the goods - basis the definition of 'input services' as well as Notification No.18/2009-ST the appellant is entitled to avail cenvat credit in respect of commission paid to the commission agent based abroad - impugned order is liable to be set aside - assessee appeal allowed

 

2016-VIL-101-CESTAT-AHM-ST

M/s AHMEDABAD AVIATION & AERONAUTICS LTD Vs COMMISSIONER OF SERVICE TAX, AHMEDABAD

Service Tax - Commercial Training or Coaching Services - activity of providing flying training to the students for obtaining pilot licence under various categories - demand - HELD - demand of tax under Commercial Training or Coaching Services cannot be sustained in view of the decision of the Hon'ble Delhi High Court in the case of Indian Institute of Aircraft Engineering Vs Union of India - demand of tax, interest and penalty is set aside - assessee appeal allowed

 

SERVICE TAX NOTIFICATION

stNoti01: Allow refund of service tax on services used beyond the factory or any other place or premises of production or manufacture of the said goods for the export of the said goods and to increase the refund amount commensurate to the increased service tax rate

stNoti02: allow refund of Swachh Bharat Cess paid on specified services used in an SEZ

stNoti03: Provide for rebate of Swachh Bharat Cess paid on all services, used in providing services exported in terms of rule 6A of the Service Tax Rules

 

Central Excise Notification

ceNoti02NT: CENVAT Credit (Second Amendment) Rules, 2016 - Amendment in Rule 2 - Cenvat credit of any duty specified in sub-rule (1) shall not be utilized for payment of the Swachh Bharat Cess

ceNoti03NT: Amendment regarding Hydro Electric Project in Bhutan

 

wbCir79CT

West Bengal: Integrated Tax Monitoring in Circles and Charges

 

wbNoti67FT

West Bengal: Regarding implementation of Fast Track Court

 

4^th Feb

 

harOrder0302

Haryana: Extension in date for online filing of Third Quarter Return

 

dndNoti02

Daman & Diu: Exemption for sale of high speed diesel by co-op soc of fisherman dated 02-02-16

 

cuCir03

Customs: Extending the Indian Customs Single Window to other locations and other

 

dgftNoti37

DGFT: Procedure for export of sesame seeds to the European Union countries

 

dgftPN60

DGFT: SCOMET Export permission for 'Stock & Sale' purposes and for export of spare parts

 

2016-VIL-66-DEL

INGRAM MICRO INDIA PVT LTD Vs COMMISSIONER, DEPARTMENT OF TRADE & TAXES

Central Sales Tax Act - Section 8(1) - inter-state sales - Rule 12(7) of the CST Rules, 1957 - denial of issuance of C-Forms - Failure to disclose the corresponding inter-state transactions in returns and failure to disclose the purchase register in Form DVAT-30 - HELD - There is nothing on record to indicate that ground under Rule 5(4)(iv) of the CST Delhi Rules is attracted - It is incumbent on the authority while examining such request in light of Rule 5(4) of the CST Delhi Rules to satisfy himself whether any of the grounds spelt out therein is actually attracted. In the present case there is a valid explanation offered regarding the mistake made in not including the inter-state purchases in the revised returns filed - Also, the authorities appear to be satisfied that these are genuine inter-state purchase transactions with no adverse impact on the revenue of the State. Thirdly, the authority is not precluded from issuing the C-Forms subject to any condition, like the furnishing of an indemnity bond by the dealer - this was not a case where the respondent was justified in declining to issue C-Forms - the impugned order is hereby set aside and a direction is issued to the Respondent to issue to the required C-Form - assessee petition allowed

 

2016-VIL-67-GUJ

STATE OF GUJARAT Vs APEX CERAMICS

Gujarat Value Added Tax Act - purchase of light diesel oil by the assessee which was used in manufacture of taxable goods - Revenue contention that fuel is neither raw material nor consumable goods in manufacturing such items - HELD - The issue is covered in favour of the assessee by decision in case of Ami Pigments - The Tribunal followed said judgment and gave relief to the assessee - no error in the judgment of the Tribunal - Mere pendency of the dispute by the Department before the Supreme Court would not permit holding back these proceedings - not inclined to entertain this petition when the Tribunal has merely followed the decision of the High Court - Revenue application dismissed

 

CENTRAL EXCISE SECTION

 

2016-VIL-65-MAD-CE

VIKASH J. SHAH & M/s SHAH YARN TEX (P) LTD Vs THE COMMISSIONER (APPEALS)

Central Excise Act - Section 11AB - Section 11AC - benefit of cenvat credit - Nil duty demand - imposition of penalty and interest - appealability of letter of jurisdictional Superintendent regarding demand of duty - HELD - assessees are entitled to challenge the letter of Range Superintendent, though it is worded as a 'letter' and not as an 'order' - the letter of jurisdictional Superintendent regarding demand of duty is appealable in Tribunal - When the CEA, 1944 and the Rules framed thereunder, permit the adjustment of CENVAT Credit, and when the Cenvat Credit is granted, there is no outstanding duty payable and therefore, the question of payment of interest and penalty do not arise - absence of the Department challenging the findings of the Tribunal that there is no justification to deny Cenvet Credit, the Revenue has no case and it is not at liberty to demand either interest or penalty - when there is no liability to pay any outstanding tax and when there is no delay or non-payment of duty, the liability to pay the interest or penalty do not arise - assessee appeal allowed

 

2016-VIL-105-CESTAT-MUM-CE

COMMISSIONER OF CENTRAL EXCISE & CUSTOMS, MUMBAI Vs M/s LSR SPECIALITY OILS PVT LTD

Central Excise - Valuation of 50 Ltrs package of lubricating oils - MRP based value or transaction value - retail sale - HELD - Rule 34 of Standards of Weights and Measures Rules, 1977 provides that if the goods are used as raw material by the industrial user then it will not be treated as retail sale and MRP is not required to be affixed - in the instant the case goods in question are not sold to industry and are is not used as raw material by any industry as 50 Ltrs. Package is sold to the truck owners who consumed themselves - In such situation, it cannot be said that 50 Ltrs package is covered under the exemption provided under Rule 34 of Standards of Weight and Measures - since the nature of the sale i.e. 50 Ltrs package is made to the ultimate customers, MRP is statutorily required to be affixed and the goods will be valued in terms of Section 4A - hence, 50 Ltrs package should be valued in terms of Section 4A and not under Section 4 of the CEA, 1944 - demands of differential duty confirmed by the lower authorities are upheld - penalty waived - In favour of revenue on merit

 

CUSTOMS SECTION

 

2016-VIL-104-CESTAT-DEL-CU

M/s RICHEMONT INDIA PVT LIMITED Vs CC, NEW DELHI

Customs - Valuation - related person - includibility of the expenses on advertising and sales promotion - impugned order to re-determined by loading the transaction value by 12.5% in terms of Rule 4 of the Customs Valuation Rules, 2007 on the ground that the transaction value was influenced as the supplier and the appellant were related persons - HELD - nowhere the Commissioner invoked Rule 10 for the purpose of loading the value - the transaction value has been loaded by 12.5% (only) in terms of Rule 4 of CVR, 2007. Therefore, it is not necessary or relevant to dwell on the aspect whether the expenses on advertisement and sales promotion etc. incurred by the appellant are includible in the assessable value in terms of Rule 10 because the adjudicating authority has not invoked the Rule 10 for loading the declared value - Application of Rule 4 - The appellant has been able to demonstrate that as a distributor its imports were at a different commercial level and in much larger quantity compared to the imports made by the individual retailers - for the purpose of loading the value by 12.5% there is complete disregard of the requirement of adjustment to be made for differences in commercial levels as well as in the quantity of goods imported and therefore, loading of 12.5% is not in conformity with the requirements of Rule 4 of the CVR - loading of 12.5% is not sustainable in terms of Rule 4 of the CVR, 2007 - assessee appeal allowed

 

2016-VIL-103-CESTAT-CHE-CU

ITC LTD Vs COMMISSIONER OF CENTRAL EXCISE (ADJN.), CHENNAI

Customs - Imported consignment cleared and declared as "Mixed Waste Paper" - claim of concessional rate of duty as per S.No.152 read with Condition No.20 of Customs Notification No.21/02-Cus. dt. 1.3.2002 - appellant contended that "Mixed Waste Paper" is classifiable under 4707 9000 which covers "unsorted waste and scrap" - mis-declaration - Adjudicating authority rejecting the transaction value of waste paper and valued the non-declared items fixing the transaction value of Plastic scrap Metallic Waste and Rags - duty demand - imposition of redemption fine and penalty under Section 114A - HELD - The very fact that appellants knew very well that the said goods cannot be used in manufacture of manufacture of paper or paperboard without sorting out the fibre contents and non-fibre contraries confirm and prove that appellants have not fulfilled the mandatory condition of the notification - The classification of plastic waste and scrap, metallic waste, cloth waste (rags) are rightly classifiable under Chapter 3915.90, Chapter 7204.30 and Chapter 6310.90 and chargeable to duty on merits. The valuation adopted and rejection of end-use certificates is liable to be upheld - the demand confirmed by the adjudicating authority is liable to be upheld. Since the plastic waste and scrap is otherwise a restricted item under Foreign Trade Policy the same are liable for confiscation. The order of confiscation of the seized goods under section 111 (d) of the Customs Act and imposition of redemption fine and penalty under Section 114A of the Customs Act is liable to be upheld - assessee appeal dismissed

 

SERVICE TAX SECTION

 

2016-VIL-105-CESTAT-AHM-ST

M/s L & T SARGENT & LUNDY LIMITED Vs CCE&ST, VADODARA

Service tax - suo-moto adjustment of excess payment of tax towards payment of service tax liability for subsequent months - failure to intimate such adjustment to the department - Rules 6(4A) and 6(4B) of the Service Tax Rules, 1994 - demand, interest and penalty - HELD - infringement of the procedure is not serious enough to impose equivalent penalty under Section 78 in the instant case. It is so especially, since in reality there is no short payment of service tax and it is a question about adjustment of excess service tax paid which has been adjusted suo-moto against the subsequent service tax liability - demand, interest and equivalent penalty under Section 78 are set-aside - penalty of Rs. 5,000/- under Section 77 is upheld - assessee appeal is allowed

 

2016-VIL-64-BOM-ST

M/s CINEYUG WORLDWIDE Vs THE UNION OF INDIA

Service tax - Settlement Commission - rejection of settlement application by holding Settlement Commission is not a forum for evaluating evidence or deciding a matter involving complicated issues of facts and law - Commission opinion solely on the basis of Report of revenue - HELD - the Settlement Commission saying, to all intents and purposes, that the matter is apparently too onerous and too taxing on the Settlement Commission's time, energy and resources. This is wholly unacceptable. The very least the Settlement Commission ought to have done, was to give the Petitioner an opportunity to respond to the Revenue's observations and Report - there has been a fatal violation of the principles of natural justice. The Commission has not proceeded in accordance with its statutory mandate under Chapter V of the CEA - Court specifically reject and repeal the reason given by the Settlement Commission that it cannot take evidence or that, when confronted with conflicting submissions on facts and law, its only recourse is to dismiss a settlement application brought before it. Nothing could be further from the statutory intent - The impugned order is quashed and set aside - Settlement Commission to consider all the material before it and pass an appropriate order on merits and in accordance with law - Appeal allowed

 

Guest Article

Rebate/refund of Swachh Bharat Cess on exports & services used in SEZ; Cenvat credit cannot be used for Swachh Bharat Cess

 

FCP0302

FROM THE CORRIDOR OF POWER - Updates from various Union Ministries, PMO & Cabinet

 

cuNoti18

Customs: Rate of exchange of conversion of the foreign currency with effect from 5th February, 2016

 

5^th Feb

 

2016-VIL-69-DEL

LARSEN AND TOUBRO LTD Vs GOVT OF NCT OF DELHI

Delhi Value Added Tax Act - Section 60 - sealing of the three premises of the petitioner - failure to produce records as sought by the notice under Section 59 of the Act - validity of the sealing order - abuse of the powers under Section 60 (4) of the DVAT Act - HELD - the sealing order bristling with so many illegalities, there can be no manner of doubt that the sealing action was undertaken mechanically and only for the reason of failure to produce records as sought by the notice under Section 59 of the Act. There was no satisfaction arrived at by the Commissioner, as mandatorily required by Section 60 (1) of the DVAT Act, that there was any deliberate attempt by the Petitioner to avoid or evade tax or to conceal its tax liability in any manner - the VATO demand order of Rs 600 crores as a condition for de-sealing the petitioner premises is based entirely on guess work and 'projections' without any adjudication. The only description that can fit such a de-sealing order is that it is 'preposterous' - the de-sealing order is an abuse of the powers under Section 60 (4) of the DVAT Act and is unsustainable in law - the impugned order is set aside and assessee petition allowed

 

2016-VIL-71-MAD

ADM AGRO INDUSTRIES INDIA PVT LTD Vs THE ASSISTANT COMMISSIONER (CT) (FAC)

Tamil Value Added Tax Act - Demand on the basis of Customs Data - non-furnishing of relied data by the respondent to assessee despite specific request - natural justice - HELD - the respondent relied the Customs Data as the underlying and conclusive basis for passing the impugned order. When such being the case, without furnishing the relied documents, the respondent cannot pass an order, which is against the principles of natural justice. The rights of the petitioner to offer explanation/objections would be prejudiced, if those documents are not furnished - respondent to furnish the documents, which were collected from the Customs Department and relied upon by the respondent in passing the impugned order - the impugned demand set aside - assessee petition allowed

 

CUSTOMS SECTION

 

2016-VIL-70-DEL-CU

ALLEN DIESELS INDIA PVT LTD Vs UNION OF INDIA

Customs Act - exemption from Special Additional Duty - refund of SAD - exemption Notification No. 102/2007-Customs dated 14th September 2007 - Denial of refund on account of payment of SAD by using the DEPB scrip instead of cash - challenge to Circulars No. 6/2008, 10/2012 and 18/2013 imposing additional restriction for availing of the exemption - HELD - what the circulars seek to amend is Notification No. 102/2007-Customs itself by introducing an additional condition for being entitled to refund, which condition does not find place in Notification - there is no such restriction in Notification No. 102/2007-Customs even as on date - Circular Nos. 6/2008, 10/2012 and 18/2013 could not have imposed an additional restriction for availing of the exemption in terms of the Notification No. 102/2007-Cus issued under Section 25(1) of the Act - An amendment to a notification issued in exercise of the powers under Section 25 (1) of the Act has to be brought about only by issuing another notification under that provision. Inasmuch as the circulars under challenge seek to impose an additional restriction for grant of refund of the SAD under Notification No. 102/2007-Customs, they are ultra vires of the Act and cannot be legally sustained. Consequently, it is declared that the Circular Nos. 6/2008, 10/2012 and 18/2013 issued by the CBEC, insofar as they seek to deny importers and exporters the refund of the SAD paid by using DEPB scrips, are invalid - The rejection of the refund applications is held to be bad in law and the said orders are hereby set aside - assessee writ petitions are allowed

 

CENTRAL EXCISE SECTION

 

2016-VIL-106-CESTAT-KOL-CE

M/s TATA STEEL LTD & M/s SAIL, DURGAPUR STEEL PLANT Vs CCE, JAMSHEDPUR & CCE, BOLPUR

Central Excise CENVAT Credit - capital goods - inputs - Rule 2(g) of CCR, 2002 - eligibility to CENVAT Credit on the items, namely, rails, sleepers, joints, crossings etc. used inside the factory in the railway net work for transportation of raw materials, semi-finished, finished goods and also in the overhead cranes - denial of credit due to change in stand of appellants claiming goods from inputs to capital goods - HELD - credit cannot be denied merely on the ground that the claims to CENVAT credit have been changed at the Appellate stage from inputs to capital goods and vice versa - Since the department has accepted the admissibility of CENVAT Credit on rails and railway track materials involving the same assesse, for subsequent period under the CCR, 2004 and identical issue is also involved in co-appellant case, therefore, adopting the principle of certainty & consistency in tax matters, the appellants are eligible to credit on rails and railway track materials - the principles of Hon'ble Supreme Court in the judgment of M/s Jayaswal Neco Ltd case is applicable in instant case - the impugned Orders are set aside and the assessee appeals are allowed

 

2016-VIL-108-CESTAT-KOL-CE

M/s HALDIA PETROCHEMICALS LTD Vs COMMISSIONER OF CENTRAL EXCISE, HALDIA

Central Excise - availment of inadmissible cenvat credit on basic customs duty instead of CVD - voluntarily reversal Cenvat credit before issuance of the show cause notice for imposition of penalty and interest - HELD - The Ld. Commissioner (Appeals) has dropped the penalty imposed under section 11AC of CEA, 1944 observing that there was no misdeclaration, suppression of facts etc. with intention to evade payment of duty - there has been no suppression, misdeclaration etc. by the appellant. Consequently the show cause notice issued for recovery of interest issued after three years is barred by limitation - no merit in the observation of the Ld. Commissioner (Appeals) that interest under section 11AB of the CEA, 1944 is recoverable - order for recovery of interest is set aside - assessee appeal allowed

 

SERVICE TAX SECTION

 

2016-VIL-72-MAD-ST

M/s UNITED CARGO TRANSPORT SERVICES Vs CESTAT & THE COMMISSIONER OF SERVICE TAX, CHENNAI

Service tax - pre-deposit - adjustment with available Cenvat credit - non-compliance of the stay order - liability to pay service tax and the issue of limitation - dismissal of appeals by tribunal for non-compliance of the stay order - HELD - When the CENVAT credit was available with the Revenue, which would safeguard the interest, insistence upon the further deposit would cause undue hardship to the appellant and as such, the appellant has established a prima facie case for their claim of waiver of pre-deposit. Though complete waiver cannot be granted, having regard to the demand made by the Department, the Tribunal should have considered the reduction of pre-deposit already ordered, having regard to the availability of CENVAT credit - pre-deposit reduced - assessee appeal allowed

 

2016-VIL-107-CESTAT-MUM-ST

J P MORGAN SERVICES INDIA PVT LTD Vs COMMISSIONER OF SERVICE TAX, MUMBAI

Service Tax - Refund of accumulated credit - input service tax credit on export of services - Rule 5 of the CCR, 2004 - denial of refund on the ground appellant was undertaking activities from premises other than the one in the registration certificate and services not included in registration - Notification No.5/2006-CE(NT) - HELD - any service which is an input for another input service will get covered under the definition of input service on which credit is sought - Service tax being a destination based consumption tax, in the case of exports there should not be any tax burden and the tax burden, if any, is to be imposed by the Government of the country where the services are consumed. Otherwise, it would render the exports of software uncompetitive. Keeping in view of above policy objective of the government, it is appropriate to hold that the appellants are eligible for the refund - this Tribunal in appellant own case, on almost identical circumstances, had allowed the refund claims - assessee appeal allowed

 

6^th Feb

 

2016-VIL-73-KER

M/s MURUGAN AGENCIES Vs STATE OF KERALA

Kerala Tax on Luxuries Act - single judge interim order directing furnishing of bank guarantee for the amount of tax payable - appellant made payment in cash in lieu of bank guarantee believing that the amounts would be refunded in case it succeeds in the writ petition - Denial of refund on ground of unjust enrichment - HELD - Had the appellant furnished bank guarantee as directed by this Court that bank guarantee could not have been enforced against the appellant and the same would have to be discharged. All the similarly situated petitioners, who had furnished bank guarantee in terms of the interim orders, were therefore entitled to avail the benefits of the interim order. The question of unjust enrichment does not arise in the instant case, since the appellant was enjoined only to furnish bank guarantee and therefore would not be liable to have the same encashed - the State cannot be permitted to take advantage of a wrongful promise held out by it to deprive the appellant of the amounts that it would otherwise have been entitled to - the appellant is entitled to refund of the amounts paid in cash - The judgment of the learned single Judge is set aside and the appeal is accordingly allowed

 

2016-VIL-110-CESTAT-BLR-CE

M/s TRAVANCORE COCHIN CHEMICALS LTD Vs COMMISSIONER OF CENTRAL EXCISE, CUSTOMS AND SERVICE TAX (APPEALS)

Central Excise - manufacture of caustic soda - change in manufacturing process from Mercury Cell Process plant to Membrane Cell Process - clearance of stock of Mercury without payment of duty - demand, interest and penalty - HELD - when the appellant shifted their process of manufacturing from "Mercury Cell Process" to "Membrane Cell Process", they had cleared their stock of Mercury, which could be in the contaminated form, and had cleared the same without payment of any duty though the item was liable for payment of duty. The goods were not sold on invoice and there was no any intimation to the Department regarding the sale - appellant is entitled to the benefit of Rule 3(4) of CCR, 2001 for payment of duty on the said cleared/sold Mercury, if the appellant has got the documentary evidence of having taken CENVAT credit for the purchase of the said Mercury - Mercury obtained through manufacture of caustic soda and cleared as such is liable to excise duty - assessee appeal dismissed

 

2016-VIL-109-CESTAT-BLR-ST

SITEL OPERATING CORPORATION INDIA LTD & DELL INTERNATIONAL SERVICES INDIA PVT LTD Vs CST BANGALORE

Service Tax - Refunds under Rule 5 of Cenvat Credit Rules - Business Auxiliary Services - export of services - HELD - the matter is remanded to the original adjudicating authority to examine the refund claims of these appellants in the light of the principles laid down by the CESTAT's Interim Order in the case of Apotex Research Pvt. Ltd - appeal allowed by remand

 

2016-VIL-111-CESTAT-CHE-CU

ARUN SMELTERS LTD Vs COMMISSIONER OF CUSTOMS (IMPORTS), CHENNAI

Customs - import of goods as Heavy Melting Scrap - uncut scrap (chapter heading 72.04 of CTH) - on examination goods classified as Used Second Hand Plastic Injection Moulding Machinery (Chapter heading 8477 of CTH) - confiscated the goods and imposed of redemption fine and penalty - appellant contesting levy for penalty having correctly declared the goods as scrap - HELD - the appellant is a actual user having manufacturing facility for re-melting the scrap - supplier instead of sending after mutilation had supplied as uncut scrap. Considering the fact that the goods are still lying in customs custody and appellants have not exercised the option of redeeming the goods on payment of redemption fine, the impugned order is upheld but for reduction in penalty - The appeal is partly allowed

 

mahaCir4T

Maharashtra: Modifications in Trade Circular No. 7T of 2015 - Online application for registration

 

cuNoti8

Customs: Exemption tocertain goods when imported into India for display or use at an event

 

cuNoti19NT

Customs: List countries as developing countries for the purposes of clause (a) of sub-section (6) of section 8B of the Customs Tariff Act, 1975

 

dgftNoti38

DGFT: Minimum Import Price (MIP) on Iron and Steel under Chapter 72 of ITC (HS), 2012 - Schedule - 1 (Import Policy): amendment in import Policy Conditions

 

7^th Feb

 

kerNotiSRO46

Kerala: Amendment in Kerala VAT Third Schedule - Mobile phone charger sold along with Mobile phone in sealed pack is taxable @ 5%

 

Article: Chargeability Of Mobile Charger

 

FCP0602

FROM THE CORRIDOR OF POWER - Finance Minister holds Pre-Budget consultations with Finance Ministers of States/ UTs with legislature

 

8^th Feb

 

2016-VIL-75-KER

STATE OF KERALA Vs M/s M.R.F. LIMITED

Kerala General Sales Tax Act - Tyre manufacturing - interpretation and construction of SRO.No.641/81 and SRO.No.1516/90 - intermediary or final product - denial of claim of concessional rate of tax on the purchase turnover of raw rubber used in the manufacture of rubber compound - whether 'rubber compound' or 'compound of rubber' are two different and distinct articles or otherwise - revenue contends that product of the process of the assessee is only a intermediary product which goes into manufacture of tyres, tubes and flaps which are manufactured by the assessee outside the State of Kerala - HELD - the overwhelming scientific opinion coming through the experts in the field of rubber and polymer technology is that compound of rubber or rubber compound is a finished rubber product - The product that comes out of the process in the assessee's unit in Kerala is itself a rubber product which has to be treated as finished one for the purpose for which it is put to use, including by persons who purchase it as such - while the State has failed to show that the article manufactured by the assessee is 'compound of rubber' and not a 'rubber compound', the assessee has succeeded in establishing that what it manufactures through its unit in relation to which the impugned assessments were made is a finished product, by whatever name it is called, and such finished rubber product is one that does not fall within the exclusion made by SRO 1516/90 and hence, the assessee is entitled to reduced rate of tax on the purchase of rubber for the manufacture of that product which is manufactured in its unit within the State - the assessee is entitled to the benefit of SRO 641/81 notwithstanding SRO 1516/90 and is therefore bound to pay tax only at reduced rate on the purchase of rubber for the manufacture of its product through its unit to which the assessments leading to the instant sales tax revisions relate; be the product called 'compound of rubber' or 'rubber compound' - Revenue sales tax revisions are dismissed

 

CUSTOMS SECTION

 

2016-VIL-76-DEL-CU

A.L. ARORA Vs UNION OF INDIA & ORS

Customs - Importer obligations in terms of the Import Export Pass Book Scheme - notification No. 117/88-Cus, dated 29th March, 1988 - failure to fulfil obligation in terms of quantity - denial of duty exemption basis circular issued by Chief Controller of Import and Export - HELD - Circulars and instructions cannot possibly restrict the ambit of a notification issued under Section 25 (1) of the Customs Act - show cause notice alleging violation of non-fulfilment of the export obligation by the Petitioner as per Notification No. 117/88-Cus., dated 29th March, 1988 was misconceived as there was no obligation on the Petitioner to comply with any 'quantity' norms for export. The only requirement was in terms of value, which the Petitioner fulfilled - writ petition is allowed

 

2016-VIL-74-MAD-CU

SHRI SRIJITH C. Vs THE COMMISSIONER OF CUSTOMS (SEAPORT-EXPORT), CHENNAI

Customs - Tribunal - reject of appeal of employee on ground of limitation - export of prohibited items - penalty under Section 114 - prosecution of ex-employee - HELD - there is no material to come to the conclusion that the delay in approaching the CESTAT was wilful - only after issuance of the Non-Bailable Warrant, the appellant has appeared before the Court. It is unlikely that the appellant should have taken his personal liberty so lightly in not appearing on summons, when he was functioning in a responsible position - Therefore, the contention that he was not aware of the adjudication proceedings and that is why, there is a delay in filing the application for condonation of delay must be true - Tribunal instead of choosing to throw out the proceedings at the threshold, should have adopted a pragmatic approach in affording an opportunity to the appellant - the impugned order is set-aside - delay of 217 days is condoned and the matter is remitted back to the Tribunal - Appeal is allowed

 

CENTRAL EXCISE SECTION

 

2016-VIL-114-CESTAT-CHE-CE

EASTMAN SPINNING MILLS (P) LTD Vs COMMISSIONER OF CENTRAL EXCISE

Central Excise - Valuation - manufacturer of cotton yarn - goods partly cleared to sister unit and partly to unrelated buyer - valuation as per Rule 8 or as per transaction value under Section 4(1) (a) of CER - HELD - Board Circular No.643/34/2002-CX dt. 1.7.2002 categorically clarified that in case of captive consumption, the goods in their own factory valuation would be done under Rule 8. Board also clarified that when same goods are partly sold by the assessee then such goods should be assessed on the basis of transaction value and duty to be determined as per Section 4 for each removal. This issue stands settled by the Tribunal's Larger Bench in the case of Ispat Industries Ltd. Vs CCE Raigad holding that provisions of Rule 8 will not apply where the goods were partly cleared to independent buyer and rule 4 is to be preferred over rule 8 - demand set aside and refund allowed - assessee appeals are allowed

 

2016-VIL-115-CESTAT-CHE-CE

THE INDIA CEMENTS LTD Vs COMMISSIONER OF CENTRAL EXCISE, SALEM

Central Excise - Admissibility of cenvat credit on OPC cement, MS plates, MS beam, MS Angle, MS channels, MS sheets, M.S. Flat, TMT Rod and TOR Rod used for the construction of 'Dry Process Cement Manufacturing Plant' - credit denied on the ground that these items were used in the construction of the cement plant and the term "plant" is not defined as "capital goods" in the CCR - HELD - The Hon'ble High Court in a decision on an identical issue had allowed the appeal filed by the very same appellant - further, immovability is not a criteria for denial of cenvat credit - appellants are eligible for cenvat credit on the capital goods used in Dry Process Cement Manufacturing Plant - the impugned order is set aside and the appeal is allowed

 

SERVICE TAX SECTION

 

2016-VIL-112-CESTAT-AHM-ST

M/s ESSAR LOGISTICS LTD Vs COMMISSIONER OF CENTRAL EXCISE & SERVICE TAX, RAJKOT

Service Tax - Port services - Levy of service tax on Lighterage & Stevedoring services rendered in relation to vessel or goods at the port under 'Port Services' as defined under Section 65(82) of the Finance Act, 1994 as amended and covered as taxable service under Section 65(102)(zzl) of the said Act, 1994 as amended, during the period from 01.10.2005 to 30.09.2010 - 'Stevedoring, Lighterage and Transshipment Contract' with for the Lighterage and transshipment of finished steel goods from the Cargo Handling Terminal of the M/s Essar Steel, Hazira and the mother vessel for both inward and outward cargos at Hazira anchorage - point for consideration is that even there is no authorization by the Port in any manner, the service rendered by the Appellant would come under the 'Port Service' - HELD - there is no evidence on record that Port had issued any authorization to the Appellant to perform any service in the port and such finding of the Adjudicating authority is totally erroneous, contrary to the record and therefore, such findings cannot be sustained - The legislative words "authorised by such port or other port", in the definition of port service make it clear that the port would authorize any person and such act cannot be delegated unless the law provides for such delegation - as there was no authorization issued by the Gujarat Maritime Board to the appellant and the demand of service tax on Stevedoring and Lighterage charges, under port service, on the appellant, prior to 01.7.2010, cannot be sustained - The contention of Revenue that the dismissal of appeal without giving reason by the Hon'ble Supreme Court in the case of United Shippers Ltd, does not amount to precedent is unsustainable - doctrine of merger applicable if appeal dismissed in the absence of detailed reasons or without reasons when superior Court upholds decision of lower court from which appeal arose - the impugned order is modified to the extent the demand of Service Tax alongwith interest on Lighterage and Stevedoring services rendered by the Appellant in relation to vessel or goods at the Magdalla / Hazira Port under 'Port services' would be upheld from 01.07.2010 and the extended period of limitation cannot be invoked. The demand of tax alongwith interest prior to 01.07.2010 and penalties are set aside - appeal partly allowed

 

2016-VIL-113-CESTAT-MUM-ST

J P MORGAN SERVICES INDIA PVT LTD Vs COMMISSIONER OF CENTRAL EXCISE (SERVICE TAX), MUMBAI

Service Tax - Export of services - refund of the service tax paid on input services for the period Sept' 2004 to April, 2005 - applicability of the Export of Service Rules, 2005 for the refund of the amount of CENVAT credit on the Exported Services prior to 15.04.2005 - HELD - lower authorities erred in holding that notification no. 12/2005 dated 19.04.2005, permits rebate of the service tax paid in the respect of export of output services is effective from 19.04.2005 and export made after 19.04.2005 are only eligible for the refund - such an interpretation would defeat the entire wisdom of the government of India in making the export of services competitive in the international market - notification also does not indicate that an assessee has to export the services on or after 19.04.2005 to avail benefit of rebate of CT credit - when it comes to substantial benefit the absence of specific embargo in the rules, the benefit should not be denied - impugned order is set aside and assessee appeal is allowed

 

mahaCir5T

Maharashtra: Grant of Refunds under VAT - Guidelines to grant refunds claimed in Form e-501 and assessment thereof on priority

 

gujEpayment

Gujarat: Preriod for compulsory e-payment of tax extended from December to February period

 

rajOrder2011

Rajasthan: online revenue (tax/non tax) collection under the ambit of e-Government Receipt Accounting System (e-GRAS)

 

Budget Article: Recapitulation of Errors that Need Instant Rectification!

 

9^th Feb

 

rajNoti080216

Rajasthan: List of total 35 Notifications issued on 08.02.2016 [Hyperlink provided for download]

 

telCir17202

Telangana: Mandatory usage of e-waybills by VAT dealers

 

apCir128

Andhra Pradesh: Comprehensive instructions regarding Registrations under VAT/CST/TOT/APPT/APET/APLT - DIPP, GOI Action points on ease of Doing Business

 

ceInst114

CBEC: Instruction regarding effect of 'in limine' dismissal of  Special Leave Petition (SLP) by the Supreme Court and Filing of Review Petition in Supreme Court

 

2016-VIL-77-DEL

BRILLIANT METALS PVT LTD Vs COMMISSIONER OF TRADE & TAXES

Delhi Value Added Tax Act, 2004 - perils of an imperfectly configured computerised system of demand and assessment - notices under Section 59(2) of the DVAT Act - notice of default assessments under Section 32 - penalty order under Section 33 - system generated notices and orders - rejection of request of the Petitioner for issuance of C-Forms on ground of outstanding demand - HELD - there is fundamental flaw in the entire exercise of the Department. This stems from the palpable failure of the computerised system devised by the DT&T for issuing notices and framing orders of default assessments - the facts portrays the avoidable confusion caused by the DT&T while issuing notices for various quarters of the same period - This was followed by the DT&T having to withdraw those notices by issuing a subsequent order admitting to the inadvertent error committed by it - If the Petitioner was, in the circumstances, unclear about whether the order survived in the light of the subsequent notices, it cannot be faulted - impugned order of default assessment and notice of default assessment of penalty is set aside - matter is remanded to VATO to begin de novo assessment proceedings pursuant to the notice issued under Section 59(2) of the DVAT Act - assessee appeal allowed by remand

 

2016-VIL-118-CESTAT-MUM-ST

M/s TATA TECHNOLOGIES LTD Vs COMMISSIONER OF CENTRAL EXCISE, PUNE-I

Service Tax - Cenvat Credit - taxable as well as exempted services - declaration under Rule 6(3A)(a) of the Cenvat Credit Rules, 2004 - Revenue contention that Rule 6(3)(ii) provides for requirement of filing declaration under Rule 6(3A) which is mandatory in nature - Exercising the option belatedly - Demand - HELD - Condition of filing declaration under rule 6(3A) of CCR, 2004 is only directory and not mandatory - most of the requirements under Rule 6(3A) are already available in the records of the Revenue - the assessee herein have calculated the CENVAT Credit in terms of clause (c) r/w clause (h) and have deposited the amount so determined, by 30th June in the succeeding financial year as prescribed - Rule 6 cannot be used as tool of oppression to extract the amount which is much beyond the remedial measure and what cannot be collected directly, cannot be collected indirectly, as well - in case of substantive compliance made by the assessee the substantial benefit cannot be denied - in the garb of Rule 6, the provisions of Section 93 of the Finance Act, 1994 cannot be overridden and/or the exemption provided under the Section 93 of the Finance Act, 1994 cannot be negated by the Cenvat Credit Rules, which is a delegated legislation and subservient to the main Act - Assessee appeal allowed and Revenue appeal dismissed

 

2016-VIL-116-CESTAT-DEL-CU

M/s JMD OILS PVT LTD Vs COMMISSIONER OF CUSTOMS, (ICD) NEW DELHI

Customs - Majority order - mis-declaration of description and value of imports - charges of mis-declaration on basis of statement of indenting agents - import of fatty acids - HELD - The appellants have never admittedly that they have paid any amount over and above the invoice value although they have admitted that international price of subject goods as 450 USD PMT but the same does not mean that the appellant has imported such goods at such a higher price. Moreover, the price which has been relied by the Revenue is originated from Malaysia whereas some of the consignments were imported from Indonesia - decision of H K International is squarely applicable to the facts of this case - as there is no contrary decision indicating that the price reflected in the invoice is not correct transaction value, charge of under valuation of transaction value is not sustainable - assessee appeal allowed

 

2016-VIL-117-CESTAT-DEL-CE

M/s INDUSTRIAL FILTER & FABRICS PVT LTD Vs C.C.E. INDORE

Central Excise - classification - dust collection bags - Demand - Extended period - allegations of fraud, suppression and willful misstatement after the issue of notification 29/2005-CE - HELD - the appellant in their assessment and clearance documents mentioned the classification as was done for many years. In the matter of classifying the product, the assessee followed their understanding. When the material facts are disclosed, a particular classification followed by the appellant will not make a case for suppression - that merely claiming a classification under a particular heading cannot be a willful misstatement or a suppression of facts - in the case of bonafide belief of a particular classification, it cannot be said that the appellant suppressed any material fact before the Department with intend to evade payment of duty - the demand for extended period is not sustainable - penalty imposed is also set aside. The demand due to reclassification as confirmed by the Original Authority with applicable interest will be restricted to the normal period of limitation - appeal disposed

 

cuNoti22NT

Customs: Revision in All Industry Rates of Duty Drawback

 

cuCir06

Customs: Regarding Amendments effective 11.2.2016 to the All Industry Rates of Duty Drawback

 

10^th Feb

 

2016-VIL-80-RAJ

CTO, A/E, BHILWARA Vs M/s SUZUKI TEXTILES LTD, BHILWARA

Rajasthan Sales Tax Act, 1954 - levy of tax on the packing material contained in which principal goods - HELD - Merely because different rates have been prescribed for packing material in cases where the goods sold in packed condition are exempt from tax, does not give rise to any such legal fiction to assume that where there is a single price charged for the commodity sold in packed condition - The intendment of the parties to transfer the property in packing material independent of goods packed therein for a price must be shown to exist and if it is transferred under compulsion without there being a voluntary agreement, it must be shown that the transfer is of packing material independent of it - tax has been levied only by invoking the last proviso to Sub-section (1) of Section 5 without establishing the fact necessary for establishing the sale of packing material independent of the sale of the principal commodity - revision petitions disposed of in terms of the judgments rendered on similar issue

 

2016-VIL-81-MAD

SRI LAKSHMI TEXTILES Vs THE COMMISSIONER OF COMMERCIAL TAXES

Tamil Nadu Value Added Tax Act, 2006 - denial input tax credit on the ground that the seller has failed to report the same before the department - HELD - Sub-Section (16) of Section 19 states that the Input Tax Credit availed is provisional. It, however, does not empower the authority to revoke the input tax credit availed on a plea that the selling dealer has not paid the tax. It only relates to incorrect, incomplete or improper claim of Input Tax Credit by the dealer - The reason adduced by the Department is unacceptable for the reason that when admittedly the petitioner firm has paid the tax, it cannot be made liable for the failure on the part of the seller to report the same to the respondent - writ petition allowed

 

2016-VIL-78-GUJ-CE

M/s WAGHBAKRIWAL RAYONS Vs COMMISISONER OF CENTRAL EXCISES & SURAT-I

Central Excise - Section 35C - Tribunal order of remand - condition of deposit, but not in the form of pre-deposit - power of tribunal directing deposit of certain amount as a pre-condition to such remand - HELD - there was no order confirming duty penalty or interest and in that sense, the condition of pre-deposit of any amount could not have been imposed. This is, however, not the same thing to suggest that even if the facts otherwise so merited, the Tribunal had no jurisdiction to impose suitable condition of depositing appropriate amount - in this case the petitioners were not duly served with the notices of hearing of the show cause notice proceedings and hearing was revived after long gap of nearly 9 years. In the meantime, factory of the petitioners was closed down. Primarily on such grounds, the condition imposed by the Tribunal of depositing a sizable sum of Rs.50 Lacs is set aside - the petitioners shall deposit cost of Rs.25,000/- with the Department subject to which the adjudicating authority shall grant hearing and dispose of the proceedings afresh - Appeal partly allowed

 

2016-VIL-119-CESTAT-KOL-CE

COMMISSIONER OF CENTRAL EXCISE, KOLKATA-IV Vs M/s BIRLA NGK INSULATORS PVT LTD

Central Excise - demand on ground of clandestine removal - shortages in the finished goods detected by the statutory auditors - Revenue contends respondents cannot deny the shortages of stock detected by their own statutory auditors - recording of wrong codes under different categories - shortages of 0.29% of their total production - HELD - clandestine removal cannot be made and held to be established based an presumptions & assumptions - case of clandestine removal cannot be considered to be established based only upon the statutory auditors of the assessee made on test check basis - even if the shortages suggested by their auditors is taken to be true, then also the same is required to be ignored as the shortage represents only 0.29% of the total production - revenue appeal dismissed

 

2016-VIL-120-CESTAT-ALH-ST

M/s TANYA AUTOMOBILES PVT LTD Vs COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX, MEERUT-I

Service Tax - Levied of tax on the amount relatable to spare parts, consumables and lubricants used in the course of servicing of the motor vehicles - Notification No. 12/2003-ST - HELD - appellants have charged the spare and lubricants separately in their invoice and have paid Sales Tax on the same - Commissioner (Appeals) erred in holding that Service Tax is applicable on the goods and lubricants observing that the service is not complete without using of consumables and lubricants - the cost of items supplied/sold and there is documentary proof specifically indicating value of the goods, the demand of Service Tax for the cost of the goods supplied during repair does not appear sustainable - assessee appeal allowed

 

2016-VIL-79-GUJ-ST

NICE CONSTRUCTION Vs UNION OF INDIA

Service Tax - appeal for condonation of delay of 18 days - writ petition under Article 226 of the Constitution - HELD - In the present case, quite apart from the petitioner presenting the appeal beyond the period what the Commissioner could condone, had simply not responded to the show-cause notice issued by the adjudicating authority - the law does not come to the aid of indolent, tardy or lethargic litigant. The conduct of the petitioner would dissuade us from entertaining these petitions - assessee petitions are dismissed

 

odiNoti3411

Odisha Entry Tax Act - Exemption to material or equipment used in the construction or installation of rural electrification projects under the Deen Dayal Upadhyaya Gram Jyoti Yojana

 

odiNoti3407

Odisha VAT Act - Exemption to material or equipment used in the construction or installation of rural electrification projects under the Deen Dayal Upadhyaya Gram Jyoti Yojana

 

Article: Some important Judgements on VAT

 

FCP1002

FROM THE CORRIDOR OF POWER - Updates from various Union Ministries, PMO & Cabinet

 

2016-VIL-122-CESTAT-MUM-CU

M/s QUALITY EXPORT HOUSE PTE LTD, SINGAPORE Vs COMMISSIONER OF CUSTOMS, JNCH, NHAVA SHEVA

Customs - declared goods were not found in conformity with the bill of lading - goods abandoned by importers - Bill of Entry not filed - appellant request to permit re-export of goods or to permit sale to a new buyer - rejection of such request basis earlier mis-conduct and mis-declaration of the importer and exporter - HELD - importers have neither filed Bill of Entry nor claimed the goods and have practically abandoned the goods. It is seen that while there is a good reason to suspect the intention of the appellant, there is no evidence that the goods would have been mis-declared in the Bills of Entry - where goods are abandoned by importers and no Bill of Entry has been filed by them nor any import documents produced by them, the title of goods remains with the exporter. There is no justification on part of the Revenue in detaining the goods - appeal allowed

 

2016-VIL-121-CESTAT-CHE-CU

CC, TRICHY Vs M/s NAGARJUNA OIL CORPORATION LTD

Customs Valuation Rules, 1988 - Valuation of second hand plant and machinery - consignment cleared through different ports - rejection of declared value by jurisdictional authorities - enhancement in value as per Rule 8 and 9 and addition of cost of dismantling, marking and packing were also added in terms of Section 14 - HELD - the contract is for supply of one entire refinery equipment from the existing mobile refinery abroad on 'as is where is condition' and includes dismantling, packing, freight, shifting, delivery charges etc. - the second hand machinery covered in all the four appeals had originated from a single place and single supplier and belongs to a single plant, however appellant cleared each shipment as independent import under specific invoice with description of item and invoice price for each equipment accompanied by the Load Port CE Certificate - In view of the peculiar nature and circumstances of the case, and assessee's request to remand the matter for de novo adjudication to one single authority so as to avoid further litigation and confusion as all the 123 consignments belong to one single refinery and in view of Revenue's acceptance to the remand proposal, all the four appeals are remanded to original authority for de novo proceedings - the issue needs to be re-examined in denovo by one single authority and finalise the case covering all the consignments. It is our concern that the Government/ Board to consider the above proposal and appoint a higher authority at the level of the Commissioner of Customs, as a common adjudicating authority for this case. This will result in uniform decision and certainly save valuable time for both sides - Appeal disposed

 

dgftTN16

DGFT: Closure of Advance Authorisation licences as per para 4.16(a) of FTP 2009-14, pending for want of payment to be received from Foreign currency account of SEZ unit

 

dgftTN17

DGFT: Clarification regarding Minimum Import Price (MIP) on Iron & Steel under Chapter 72 of ITC (HS) 2012 - Schedule I Import Policy

 

karCir23

Karnataka: Karnataka Tax on Entry of Goods Act, 1979 - Impact of High Court Judgment in the case of State of Karnataka Vs M/s United Breweries Limited

 

11^th Feb

 

2016-VIL-82-RAJ

M/s PALI ZILA DUGHDH UTPADAK SAHKARI SANGH LTD Vs COMMERCIAL TAXES OFFICER

Rajasthan Sales Tax Act - imposition of additional tax beyond the concessional rate of 4% on the purchase by the Assessee of Skimmed Milk Powder - declaration in Form ST-17 - demand of additional tax on account of omission of Skimmed Milk Powder in application/amended Registration Certificate as Raw Materials/Processing Articles - Registration certificate - HELD - for invoking Section 10(4) of the Act for imposing the additional tax, the condition necessary to be established and the burden of proving the same definitely lying upon the Revenue, is that, 'while purchasing any articles, assessee represents wrongly that such articles are covered by his Certificate of Registration as specified in sub-section (3)' - Skimmed Milk Powder purchased by the Assessee during the period between 1995 to 2003 against declaration Form ST-17 was entitled to be purchased at the concessional rate of 4%, and there was neither any misuse, nor any wrongful representation was made by the Assessee in such declaration forms, and therefore, the levy of additional tax and interest was not justified - the Court would not like to avoid a purposive and beneficial interpretation in favour of the Assessee, merely on account of its inadvertent omission to get the same incorporated specially in the amended registration certificate issued in the year 1995 at the call of the Department itself. Though the error and omission is admitted by the assessee, but it cannot be said to be a wrong representation made by the Assessee. It is not a case of consciously made wrong representation by the Assessee, but a case of inadvertent omission, for which taking a hypertechnical view, the stand of the Assessee does not deserve to be defeated - the impugned orders are quashed and set aside - assessee revision petitions are allowed

 

2016-VIL-83-KER

PREMIUM FERRO ALLOYS LIMITED Vs STATE OF KERALA

Kerala Tax on Entry of Goods into Local Areas Act, 1994 - petition for refund of Entry tax already paid - single judge order directing provisional adjustment of refund amount with entry tax dues and penalty - Refund pursuant to judgment in Thressiamma L.Cherayil case, which is pending consideration in appeal before the Hon'ble Supreme Court of India - HELD - The pendency of the appeal does not in any manner affect the correctness of the judgment which is subjected to the appeal - Yet such principle would not be the guiding factor to decide as to whether the learned single Judge, had erred in law or on facts in issuing the directions which are contained in the judgment impugned - the precedents cited on behalf of the appellant do not lead to the conclusion that an order of refund ought to have been made as sought for by the writ petitioner - the directions issued by the learned single Judge advance course of justice - no ground to interfere with the impugned judgment. The writ appeal fails and dismissed

 

2016-VIL-123-CESTAT-AHM-CE

M/s SHIVAM TEXTILES Vs COMMISSIONER OF CENTRAL EXCISE & SERVICE TAX, SURAT-I

Central Excise - Manufacture - whether the 'Due Drop Process' on Fabrics will amount to manufacture and - Appellant's belief that it did not amount to manufacture is 'bonafide belief' - process of Dew Drop on duty paid Dyed and Printed fabrics on job work basis - demand invoking extended period - subsequent issuance of an exemption - HELD - the Dew Drop Process was brought into the country in August 2000 from Korea - the process does not have a long lasting effect and does not amount to transformation of the fabrics. It is more in the nature of enhancing the attributes or attractiveness of the fabrics. The effect also gets washed away by simple washes - No fault of the Appellants having a bonafide belief that during the relevant period the process did not amount to manufacture and that they are not liable to Central Excise duty - duty demand on the process of Dew Drop for the period August 2000 to December 2000 cannot be sustained - Assessee appeal is allowed

 

2016-VIL-126-CESTAT-DEL-CE

M/s WHALE STATIONERY PRODUCTS LTD Vs CCE, MEERUT - I

Central Excise Act, 1944 - manufacture - Conversion of larger size Carbon Paper into smaller size - area based exemption under Notification No. 50/2003-CE dated 10/06/2003 - denial of exemption basis carbon paper having width more than 36 cms. falling under Tariff Heading 4809.10 were excluded from the purview of the exemption Notification - Demand - HELD - The Department has not brought forward any evidence to the effect that even after expansion the appellant is clearing only Carbon Papers of width exceeding 36 cms. The ld. Commissioner (Appeals) has observed that after printing and coating the Carbon Paper of larger size is converted or sized into Carbon Paper of smaller size. Having recorded so, the learned Commissioner (Appeals) can't proceed to conclude that cutting Carbon Paper of broader width to smaller size will amount to manufacture and hence duty has to be discharged on the larger Carbon Paper - the ld. Commissioner (Appeals) distinguished the decision of the Hon'ble Supreme Court in S.R. Tissues Pvt. Ltd stating that slitting and cutting other process like coating, chilling, tinting & printing, punching, sizing etc. are also carried out resulting in Carbon Paper for various applications - such assertion has not been categorically supported with any evidence - As there is no allegation or factual evidence for finding to the non-application of decision in S.R. Tissues Pvt. Ltd, the decision of the Hon'ble Supreme Court is applicable to the present case - impugned order is unsustainable - Assessee appeal allowed

 

2016-VIL-124-CESTAT-BLR-ST

M/s TNT (INDIA) PVT LTD Vs COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX, BANGALORE-III

Service Tax - Cenvat Credit - excess payment of service tax - availment of Cenvat Credit equivalent to excess tax paid - subsequent reversal of CENVAT credit and filing of refund claim - SCN for recovery of interest under Rule 14 of CCR, 2004 and imposition of penalty on irregularly taken CENVAT credit - HELD - taking of CENVAT credit for the excess payment of service tax may be called technically irregular CENVAT credit, but again strictly speaking it is a technical flaw, which had occurred mainly on account of wrong calculation - It is on record that the said CENVAT credit was based on actual payment of service tax, though in excess, and on no occasion the appellant utilized the same - strictly speaking this decision of the Hon'ble Supreme Court in Ind-Swift Laboratories is not applicable to the present facts - as there has been no liability to pay service tax on the appellant, Revenue cannot impose liability to pay interest on the assessee invoking the provisions of Rule 14 of CCR, 2004 - the facts, strictly speaking do not clearly prove that the CENVAT credit taken on the excess payment of service tax was in the strict category of "wrongly taken or utilized CENVAT credit" - the Revenue's stand for recovery of interest under Rule 14 of CCR, 2004 and imposition of penalty under Rule 15 of CCR, 2004 cannot succeed - assessee appeal allowed

 

2016-VIL-125-CESTAT-DEL-ST

SOMANI AGENCIES Vs CCE & ST, INDORE

Service Tax - Clearing and forwarding agent service - Section 65 (25) of Finance Act, 1994 - Applicability of Kulcip Medicines Pvt. Ltd case order - Extended period - HELD - appellant was to act as clearing and forwarding agent for the purpose of receiving, storing and forwarding of goods - the appellant cleared the goods received at its end and stored them in the warehouse and thereafter forwarded them as per the directions of the service recipient - as per the activities performed by the appellant, it is squarely covered within the definition of clearing and forwarding agent and it provided service to a client in relation to clearing and forwarding operations - the judgement of Karnataka High Court in Mahavir Generics is squarely applicable to the present case - Punjab & Haryana High Court in its judgement in the case of Kulcip Medicines distinguished - Demand invoking extended period is upheld - Assessee appeal is dismissed

 

apCir6110902

Andhra Pradesh: Check Posts - Detention of goods at Check posts - Streamlining of Procedure

 

apCir6110601

Andhra Pradesh: Check Posts - Detention of goods at Check posts - Streamlining of Procedure - Banning of manual systems of physical checks at ICP/BCPs

 

cuCir04

Customs: Procedure for renewal of SVB orders and ongoing SVB inquiries

cuCir05

Customs: Procedure for investigation of related party import cases and other cases by the Special Valuation Branches

 

bihNotiSO22

Bihar: Date of effect of amendments made by Sl. No.7 of the departmental notification No.189 dated 03 August, 2015

 

delNoti42

Delhi Value Added Tax (Amendment) Rules, 2016 - Amedment of Rule 28

 

delNoti1424

Delhi: Regarding filing of online returns by firms and companies engaged in the business of courier activities

 

gujNoti13

Gujarat Tax on Entry of Specified Goode Into Local Areas (Amendment) Rules, 2016 - Amendment of Rule 9 - Regarding adjustment of Refund amount

 

12^th Feb

 

2016-VIL-87-MAD

M/s WHIRLPOOL OF INDIA LTD Vs THE STATE OF TAMILNADU

Tamil Nadu General Sales Tax Act, 1959 - levy of higher sales tax for imported goods - import and sell home appliances - demanded the enhanced rate of tax at 20% on the goods which were imported even before amendment act 22/2002 - retrospective application of amendment - differential levy - HELD - The Honourable Division Bench of this Court reported in Sony India Ltd V. CTO has affirmed the notification involved in this case and the amendment thereon and dismissed the case involving similar issue. Hence, this case is directly covered against the petitioner - assessee petition dismissed

 

2016-VIL-86-RAJ

C.T.O.Vs M/s D.K.GWAR UDYOG

Rajasthan Sales Tax Act, 1994 - CST Act, 1956 - goods purchased against ST-17 sold in course of export - submission of Form-H - transactions duly disclosed in the books of accounts - revenue appeal against impugned order setting aside penalty under Section 64 of the Act - HELD - not only the transactions and sales were duly disclosed in the books of accounts and were supported by proper invoices and declarations, the issue of imposition of tax itself on such transactions was a debatable issue - no malafides can be attributed to the assessee and no penalty taking a technical view of the matter, on misuse of declaration Form ST-17, could have been imposed by the Assessing Authority - revenue revision dismissed

 

CENTRAL EXCISE SECTION

 

2016-VIL-129-CESTAT-DEL-CE

TAJ SATS AIR CATERING LTD Vs CCE, DELHI-II

Central Excise - Manufacture - taxability of the meal tray as served to the airline passenger under 'branded food preparations' - demand under C.E.T.H. 2108 for the financial year 2004-05 and under C.E.T.H. 2106 for the financial years 2005-06 and 2006-07 - edible preparation bearing the brand-name - extended period - HELD - From the nature of process and the methodology of supply by the appellant to the airlines and thereafter by the airlines staff to the passengers on board, it is not legally sustainable to tax the entire meal tray as edible preparations as the same emerges at the time of service to the passengers on board - the food items prepared and supplied by the appellants never had brand-name when they were cleared from the premises of the appellant - Revenue has not established the liability on the appellant for their activity of manufacturing branded food preparations. There is nothing in the impugned order which will substantiate and support the claim of the Revenue on the taxability of such complete food tray on whole value - the demand after many years of the impugned period is not sustainable in view of the facts and circumstances of the case - impugned order is not sustainable both on the question of manufacture and on time bar - assessee appeal allowed

 

2016-VIL-130-CESTAT-DEL-CE

M/s HINDUSTAN SYRINGES MEDICAL DEVICES LTD Vs COMMISSIONER OF CENTRAL EXCISE, FARIDABAD

Central Excise - Cenvat credit - appellant manufactures medical disposal syringes - availed benefit of Notification 10/03-CE and paid duty of 8% and availed cenvat credit on inputs lying unutilized in stock - denial of Cenvat credit on the grounds that they are not covered by Rule 3(2) of CCR, 2002 and that they have availed after a gap of one year -HELD - Even as per Rule 3(1) of CCR, 2002, assessee is entitled to Cenvat credit on inputs in question which were either available in stock or in process or were contained in final product lying in stock as on 1-3-2003, thus, assessee is entitled to claim Cenvat credit under Rule 3 of CCR, 2002 - as there is no time limit prescribed under Cenvat Credit Rules, 2002 during the impugned period, therefore the appellant is entitled to take credit

 

CUSTOMS SECTION

 

2016-VIL-84-ALH-CU

M/s PASWARA CHEMICALS LTD Vs UNION OF INDIA

Customs - Section 111(d) and 111(m) of Customs Act, 1962 - confiscation of imported goods treating it hazardous - later on release of goods on the basis of report of MOEF - Demand of demurrage charges by Central Warehousing Corporation - Handling Of Cargo In Customs Area Regulations, 2009 - HELD - the Central Warehouse Corporation or its partner could not demand any warehouse charge on the goods, which were detained by the Customs Authority. They were bound to comply with the terms and conditions of their appointment letter read with clause 6 (l) of the Regulations of 2009. The contention of the respondents that clause 6(l) is not applicable in view of the word 'subject to' given in clause 6(l) and, therefore, section 63 of the Act would prevail, is patently erroneous - the action of CWC and its partner in not releasing the goods and insisting upon warehouse charges was not only illegal but was also in violation of the terms and conditions of their licence and also in violation of Regulation 6(l) of the Regulations of 2009 - petitioner was entitled for release of the goods without payment of warehouse charges - however, petitioner should have contested the matter upon payment of the charges by depositing the same under protest - Once the stand of the respondents became known to the petitioner further retention of the goods by the respondents was totally at the risk and peril of the petitioner - writ petition is allowed

 

2016-VIL-127-CESTAT-AHM-CU

M/s INDIAN OIL CORPORATION LTD Vs CCEC&ST, VADODARA-II

Customs - Section 154 - Correction of clerical errors - correction in final assessment order - assessee request for rectification of mistakes that a consignment of indigenous crude oil had been treated as an imported crude oil instead of indigenous crude oil - HELD - the Commissioner (Appeals) observed that the final assessment of the Bills of Entry is an appealable order, which cannot be rectified under Section 154 of the Act - Section 154 of the Act, is an independent provisions for correction or rectification of errors, in any order or decision passed by the officer, and the authority should have examined as to whether it is a mistake within the scope of Section 154 of the Act. In the present case, both authorities below had failed to consider the facts of the case in the light of the Section 154 of the Act - the impugned order is set aside and matter is remanded to the Adjudicating Authority to decide afresh after considering the submission of the appellants - appeal is allowed by way of remand

 

SERVICE TAX SECTION

 

2016-VIL-128-CESTAT-AHM-ST

M/s DEWSHREE NETWORK P LTD Vs CCE&ST, SURAT-I

Service Tax - Cenvat credit - invoices/challans - credit denied on the input service on the ground that the computer generated invoices were not signed by the service provider - Rule 4A of the Service Tax Rules 1994 - HELD - Proviso to Rule 9 (2) of CCR, 2004 gives discretionary power Deputy Commissioner of Central Excise or the Asstt. Commissioner of Central Excise, as the case may, to allow the credit in certain circumstance - Legislature has given power to the concerned office to solve the problem in case the documents are incomplete and to allow cenvat credit - such power should be exercised in all reasonable and fairness -the letter obtained through RTI Act, 2005 would clearly show that the condition of Rule 9(2) were fulfilled. It is also noticed that on the identical situation, the Commissioner of Central Excise allowed the credit in respect of the other assessee. Hence, there is no justification to deny the credit on input service - impugned order set aside - assessee appeal allowed by remand

 

2016-VIL-85-BOM-ST

GANNON DUNKERLEY & CO. LTD Vs COMMISSIONER OF SERVICE TAX, MUMBAI-I

Service Tax - appellant provided services in nature of works contract - payment of short paid service tax before issuance of a Show Cause Notice - demand under section 73 along with interest under section 75 and penalties under sections 76 and 78 of CEA, 1944 - jurisdiction of Commissioner of Service Tax to impose a penalty under Section 78 for a period prior to 13th May 2005 - assessee appeal against tribunal order - HELD - the impugned order is wholly unsatisfactory. The CESTAT has simply recorded the contentions on both sides but has not given us the benefit of their reasons for their conclusion - the impugned order is quashed and set aside - Appeal is restored to the file of the CESTAT - assessee appeal allowed by remand

 

odiFMspeech

Speech of Finance Minister of Odisha in Pre-Budget Consultation of Union Minister, Finance for Union Budget 2016-17

 

delNoti1437

Delhi: Regarding time period for rectification or revision of return in Form GE-II

 

cuNoti24NT

Customs: Exchange Rate notification with effect from 13th February, 2016

 

dgftNoti39

DGFT: Procedure for export of sesame seeds to the European Union countries - Deferment of implementation

 

13^th Feb

 

2016-VIL-05-SC

STATE OF JHARKHAND Vs TATA STEEL LTD

Bihar Finance Act, 1981 - Jharkhand Value Added Tax Act, 2005 - Section 95(3) (ii) - deferment of tax - Exemption - interpretation of the deferment policy in the context of provisions enumerated under the JVAT Act - relevant date for commencement and end of deferment - failure to make the repayment of deferred tax within the prescribed period - Levy of interest - interpretation of statute and notification - legislative intent - HELD - in a taxing statute there is no room for any intendment but regard must be had to the clear meaning of the word - The notification lays a clear postulate that repayment of total deferred amount shall have to be done in ten equal six monthly instalments in such a manner so as to be completed within 13 years from the date of start of deferment. The words "from the date of start of deferment" have to have nexus with the policy stated in the beginning - The concept of exemption is distinct from the concept of deferment of tax - The postulate enshrined in the notification has to be appositely appreciated. It does not flow from the notification that if a benefit is granted for 8 years or for a lesser period, the assessee cannot claim that the repayment has to be completed within 13 years from the date of grant - the claim of the assessee that the repayment schedule has to continue for a period of 13 years from 2006, for the deferment commenced only in 2006. Such an interpretation not only causes serious violence to the language employed in the notification but if it is allowed to be understood in such a manner, it shall lead to an absurd situation - the intention can be gathered from the notification that it has to relate back to the date of eligibility with a maximum limit of 13 years. It cannot be construed to mean 13 years from the date of completion of the eligibility period - Words "from the date of start of deferment" cannot be conferred a meaning in the manner suggested by the the assessee. It is a well-known principle of statutory interpretation that if an interpretation leads to absurdity, the same is to be avoided. Court has no hesitation here to say that if the notification is read as a whole, the intention, purpose and working of it is absolutely clear. The ingenious interpretation placed on the words are really beyond the context and, therefore, we are not disposed to accept the same. Thus analysed, the irresistible conclusion is that the repayment schedule has to end on 31.08.2013 within a span of 5 years from the expiration of the eligibility period - levy of interest upheld - In favour of State

 

ceNoti04NT

Central Excise: Notification under Section 11C of the Central Excise Act on Di-Calcium Phosphate (animal feed grade) of rock phosphate origin falling under heading 2835

 

dnhCir2015

Dadra and Nagar Haveli: Applicability of H-Form in such local purchases which satisfies conditions laid down under Section 5 (3) of the CST Act, 1956

 

Kerala Budget 2016-17 - Budget Speech [Download link]

Uttar Pradesh Budget 2016-17 - Budget Speech [Download link]

 

15^th Feb

 

2016-VIL-89-KER

CYRIL JACOB VELLAPPALLY JACOB VELLAPPALLY AND CO. Vs COMMERCIAL TAX OFFICER (WC), KOTTAYAM

Kerala Value Added Tax Act - Section 8(a)(i) - works contract - Eligibility to pay VAT on works contract at compounded rates - requirements for cancellation of registration under the CST Act - Effect of subsequent amendment - HELD - assessment year 2005-06 the amendment to Section 8(a)(i) having come into force in the middle of the assessment year, and it being almost impossible on account of the statutory provisions of Section 7(5) of the CST Act, to get a cancellation of the certificate of registration in 2005-06 itself, it would be unfair on the part of the revenue to insist on the higher rate of compounded tax under Section 8(a)(ii) of the Act on the works contracts executed - The orders of penalty imposed on this ground also cannot be legally sustained. - Demand of differential tax and penalty set aside - Cancellation of the CST registration before the commencement of the assessment year 2006-07 - HELD - petitioners had ample time during the assessment year 2005-06 itself to ensure that they were duly qualified for exercising their option under Section 8(a)(i) - The petitioners having not chosen to do so, and having opted for payment of tax at the lower rate of compounded tax under Section 8 (a)(i), when they were not entitled for the same - the Assessing officers finding that the petitioners are not entitled to the rate of tax under Section 8(a)(i) of the Act, cannot be said to be illegal - Assessee petition partly allowed

 

2016-VIL-133-CESTAT-MUM-CE

M/s JSW STEEL COATED PRODUCTS LTD Vs COMMISSIONER OF CENTRAL EXCISE, THANE-II

Central Excise - Cenvat Credit Rules 2004 - Rule 6(4) - Capital goods - Denial of credit on capital goods on the ground that the same are used partially for producing electricity which is sold outside - balance electricity is used for manufacture of dutiable final products - HELD - though a portion of the generated electricity from the power plant was sold outside, however, it cannot be said that capital goods were exclusively used in manufacture of exempted goods (electricity) as a portion of electricity generated in the power plant is also utilized in manufacture of final dutiable goods - assessee is entitled for modvat credit against the capital goods used in the captive power plant - So long as credit is allowable either as Capital goods or as inputs, the demand cannot be sustained - Cenvat credit on input services in terms of Rule 6(1) of the CCR, 2004 - credit allowable on input service for that proportion of the duty paid, which proportion of the electricity has been used captively in production of dutiable goods

 

2016-VIL-89-KER-CU

FIRDOUSE INTERNATIONAL TRADING CO. Vs COMMISSIONER OF CUSTOMS, COCHIN

Customs - import of goods - requirement to satisfy the standards and Regulations of the Food Safety and Standard Authority of India at the time of import or at the time of release - HELD - The petitioner's right to import is always subject to the policy of India. The importers have no right to import any food articles which is hazardous or injurious to the public health - the standards under the Food Safety Act will have to be looked into from the stand point of view of the general public - The legitimate expectation of the importer would always subject to the policy change of the State. If the law is changed as on the date of release, the importer is bound by the law on the date of release - The standards are prescribed for protecting the public. Therefore, the date of release is relevant not the date of import for the purpose of reckoning standards - writ petition dismissed

 

2016-VIL-134-CESTAT-CHE-CU

M/s BRIDGESTONE INDIA PVT LTD Vs CC, CHENNAI

Customs - refund claim of 4% SAD - fulfilment of condition of Notification No. 102/07-Customs dated 14.09.2007 - rejected the refund claim on the ground that in terms of the amount on the invoices that of non-admissibility of cenvat credit as per the condition 2 (b) of Notification No. 102/07 - no endorsement that "credit of duty is not admissible" on the commercial invoices - HELD - the appellant has imported finished goods for the purpose of trading - trader-importer, who paid SAD on the imported goods and who discharged VAT/ST liability on subsequent sale, and who issued commercial invoices without indicating any details of the duty paid, would be entitled to the benefit of exemption under Notification 102/2007-Cus - As appellant are manufacturers of tyres and also imported tyres for the purpose of trading it is eligible for the benefit of Notification No. 102/07. The impugned orders are set aside and appeals are allowed

 

2016-VIL-131-CESTAT-MUM-ST

BANK OF BARODA Vs COMMISSIONER OF SERVICE TAX, MUMBAI-I

Service Tax - taxability of SWIFT under Banking and Other Financial Services - Provision and transfer of information and data processing - transfer of information and data processing - service tax demand under reverse charge for utilizing the services of SWIFT network to transmit, financial messages internationally which culminated in foreign exchange remittance transactions getting completed, between BOB and the intended recipient - principle of mutuality - revenue neutrality - HELD - From the process involved, it is clear that the activities appear to amount to provision and transfer of information and data processing in relation to banking and other financial services, as defined under the Act and clearly covered under the entry provided in sub-clause (a)(vii) of Sec. 65(12) i.e. 'provision and transfer of information and data processing' - even if it is presumed that SWIFT is not involved in Banking and Other Financial Services, the services shall remain taxable as the service is clearly covered under the definition of Banking and Other Financial Services in clause (vii) of Section 65(12). Moreover the appellant being liable to pay the service tax is "deemed service provider". Therefore, the status of the appellant is required to be considered and not the status of service provider who is located outside the India - transaction between the Bank and the SWIFT is purely a business transaction; therefore the principle of mutuality does not exist in such transaction - merely because Section 80 was invoked, it cannot be said that proviso to Sec 73(1) shall not apply. Both provisions have separate ingredients - appellant have not disclosed the data related to service charges paid to SWIFT to the department. Therefore, there is a suppression of the fact, proviso to Section 73(1) get correctly invoked - However the issue involved interpretation of definition of Banking and Other Financial Services, there is a reasonable cause for not imposing the penalty by invoking Sec 80 - Assessee appeal partly allowed

 

2016-VIL-132-CESTAT-MUM-ST

ICICI LOMBARD GENERAL INSURANCE COMPANY LTD Vs COMMISSIONER OF SERVICE TAX, MUMBAI-I

Service Tax - Admissibility of CENVAT credit of Excise Duty paid on Furniture and Fittings and the Service Tax paid on 'outdoor catering services' - HELD - appellant is eligible to avail CENVAT credit to the extent of service tax paid by the canteen contractor and is not eligible to avail CENVAT credit of the service tax paid on the value of the services utilized by the employees of the appellant - Furniture and Fittings are nothing but tables and chairs which were procured by appellant during the relevant period - tables and chairs are used for rendering output services - appellant is eligible to avail the CENVAT credit of excise duty paid on Furniture and Fittings - assessee appeal allowed

 

dgftNoti40

DGFT: Amendment in export policy of Pulses

 

dgftTN18

DGFT: Instruction on applications for IEC / modification in IEC

 

cuNoti25NT

Customs: Tariff Notification in respect of Fixation of Tariff Value of Edible Oil, Brass, Poppy Seed, Areca Nut, Gold and Sliver

 

jhrNoti35

Jharkhand Value Added Tax (Amendment) Act, 2015 - Amendment of Section 18 & 63