SUMMARY FOR THE MONTH OF NOVEMBER

 

List of updates in the month of November ‘15

 

 

2^nd of Nov

 

2015-VIL-473-ALH

BHARTI AIRTEL LTD Vs STATE OF U.P.
U.P. Trade Tax Act, 1948 - Section 8(1) – U.P. Value Added Tax Act - Section 33 (1)(2) liability to pay interest – HELD - the petitioner disputed the Entry Tax liability on the ground that the petitioner was importing "electrical equipments" and that the petitioner was not liable to pay any tax as it was not a "machinery" - since the petitioner has disputed its liability from the very inception, the same cannot be treated to be the admitted tax for the purpose of Section 8(1) of the Act read with Section 33(2) of the UPVAT Act. Thus, for the purpose of imposition of interest, the provisions of Section 8(1B) of the U.P. Trade Tax Act r/w Section 33(4) of the UPVAT Act would be applicable - The impugned order is quashed and writ petition is allowed - Deputy Commissioner (Assessment) is directed to re-determine the interest in accordance with the provisions of Section 8(1B) r/w Section 33(4) of the UPVAT Act – Assessee petition allowed

 

2015-VIL-474-GUJ

STATE OF GUJARAT Vs DEEPAK PETROLEUM LTD

Gujarat Value Added Tax Act – Pre-deposit - whether the Tribunal was justified in reducing the amount of pre-deposit as directed by the first appellate authority as a condition precedent for hearing the appeal – contention of financial hardship - HELD - the powers to direct payment of pre-deposit are discretionary powers and such discretion is required to be exercised by the concerned authority in a reasonable manner - the finding recorded by the Tribunal whereby, it has recorded a prima facie view in favour of the assessee, it cannot be said that the discretion exercised by it in refusing the amount of pre-deposit is, in any manner, unreasonable, or arbitrary so as to give rise to any question of law - sub-section (3) of section 73 of the Act does not contemplate financial hardship as one of the factors to be taken into consideration for the purpose of waiver of pre-deposit - Tribunal order upheld and revenue appeal dismissed

 

2015-VIL-599-CESTAT-DEL-CE

M/s AGRO TECH FOODS LTD Vs COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX, JAIPUR-I

Central Excise - Repacking of refined edible oil in retail pack - Denial of Cenvat Credit availed on input and packing material - notification no. 37/03-CE dated 30.04.2003 – HELD - Notification gives option of either paying duty of Rs.1/- per kg. or claiming exemption of nil rate of duty - when there are two views possible on a Notification, the view which is more beneficial to the assessee has to be applied – In this case, the appellant felt that payment of duty of Rs. 1/- per kg. on the unit containers of refined edible oil manufactured by them would be more advantageous to him and has chosen to do so. When the Notification itself gives two options, the choice of the appellant to choose an option which is beneficial to him cannot be faulted with - appellant has rightly claimed entry 244 (B) of the notification no. 37/03-CE dated 30.04.2003 and chose to pay duty at the rate of Rs. 1 per Kg. In these circumstances, Cenvat Credit cannot be denied – Assessee appeal allowed

 

2015-VIL-600-CESTAT-MUM-CE

M/s REXFORD (I) PHARMACEUTICALS Vs COMMISSIONER OF CENTRAL EXCISE, THANE-II

Central Excise - Appellant, SSI unit, manufacturing the goods of another small scale unit – Admissibility of benefit of Notification No.175/86 even in respect of goods manufactured on behalf of another SSI – HELD – at the relevant time, even though M/s. VPL has taken the provisional SSI certificate but manufacturing facility had not come into existence - It is not in dispute that during the period in question M/s. VPL was not having manufacturing facility and has not commenced the commercial production. Hence goods manufactured by the appellant in the brand name of M/s. VPL would not be eligible for the benefit of Notification 175/86 - extended period of limitation has been correctly invoked – demand and penalty confirmed, assessee appeal dismissed

 

2015-VIL-472-GUJ-ST

COMMISSIONER Vs RELIANCE PORTS AND TERMINALS LTD

Service Tax – Port Services - Cenvat Credit – HELD - In the show cause notice, the assessee was not called upon to state as to whether the services of “Consulting Engineers” and “Banking and other Financial Services” are “input services” of the respondent or as to whether the capital goods were used for providing “output services” provided viz. ‘Port Services’ - in the present appeal department seeks to challenge the impugned order on grounds which were never subject matter of the show cause notice - the show cause notice is the foundation of the demand under the Central Excise Act and that the order-in-original and the subsequent orders passed by the appellate authorities under the statute would be confined to the show cause notice, the question of examining the validity of the impugned order on grounds which were not subject matter of the show cause notice would not arise - The questions proposed by the Department which were not subject matter of the show cause notice, do not arise out of the impugned order passed by the Tribunal – Revenue appeal dismissed

 

2015-VIL-598-CESTAT-CHE-ST

M/s MRF LTD Vs COMMISSIONER OF CENTRAL EXCISE, CHENNAI

Service Tax – Cenvat Credit - whether the contractor who had engaged sub-contractor to provide the services and the services so provided suffered service tax, shall disentitle the contractee to avail credit of the service tax so paid to the sub-contractor by the contractor – HELD – There is no difference on the fact that the services of CHA were M/s. SRS Cargo International was availed by assessee, through its agency M/s. VPC Freight Forwarders (P) Ltd., who in turn engaged M/s. SRS Cargo International to clear the imports of assessee - Once there is no question on provision of service and that is attributable to the goods imported by appellant denial of the credit of the service tax paid by appellant, to sub-contractor, shall be prejudicial to the interest of justice – Assessee appeal allowed

 

delNoti886

Delhi: Central Sales Tax [(Delhi) (Amendment)] Rules, 2015 - Amendment in Form - 1

 

delCir28

Delhi: Filing of reconciliation return for the year 2014-15 - Extension in date

 

sikNoti110

Sikkim: Extension in period of filing return for the second quarter of financial year 2015-16

 

3^rd of Nov

 

2015-VIL-476-BOM

THE COMMISSIONER OF SALES TAX Vs M/s JAI HIND INDUSTRIES LIMITED

Bombay Sales Tax Act, 1959 - Interpretation of Entry C-I-29 of Part I of Schedule-C - whether raw aluminum castings are covered by the residual Entry C-II-102 of the Act and exigible to tax @ 10% or whether they fall under Entry C-I-29 exigible to tax @ 4% -  Word  ‘castings’ – HELD - what is manufactured by the assessee is very much in the raw, unfinished and primary form and are not finished goods - aluminum castings manufactured and sold to the automobile industry, are in its raw, unfinished and primary form which require further processes such as milling, drilling, tapping etc. by the purchaser before they are used in the manufacture of their motor vehicles / chassis. Accordingly, the raw aluminum castings would fall within Entry C-I-29 of the Bombay Sales Tax Act, 1959 and not within the residual Entry C-II-102 – No force in the argument that merely because the word ‘castings’ is not found in Entry C-I- 29, the raw aluminum castings manufactured by the Respondent cannot fall within the aforesaid Entry – Tribunal order upheld and revenue appeal dismissed

 

2015-VIL-477-MAD

ACE STAR PROPERTIES PVT LTD Vs THE COMMERCIAL TAX OFFICER

Tamil Nadu Value Added Tax Act - levy of tax on TDS – dismissal of appeal by appellate authority on the ground that no appeal would lie as against the dispute entirely over TDS and a revision alone would lie – HELD - as against the order passed under Section 27(3) of the TNVAT adjudicating the dispute which is solely on TDS a revision alone will lie - instead of entertaining the appeal, the appellate authority ought to have returned the papers to the petitioner so as to enable him to resent the papers before the revisional authority - The impugned order of the appellate authority dismissing the appeal as against levy of tax on TDS and the consequential levy of penalty under Section 27(3) of the TNVAT Act, for want of jurisdiction, is set aside and the appellate authority is directed to return all papers to the petitioner - writ petition is allowed

 

2015-VIL-475-KAR-CE

M/s HINDUSTAN PETROLEUM CORPORATION LTD Vs UNION OF INDIA

Central Excise & Service Tax – Pre-deposit - Validity of the amendment made to Section 35F of the Central Excise Act - Provision for a mandatory pre-deposit of 7.5% - retrospective operation of the amendment - right to file an appeal - Distinction between substantive law and procedural law – HELD - the right to file an appeal, which is a substantive right granted under Sections 35 and 35B of the Act has not been amended and remains intact. Thus, Sections 35 and 35B do not confer an absolute right to file an appeal, but are subscribed or controlled by Section 35F of the Act. Hence, in the instant case, the right to file an appeal under Section 35 or 35B as the case may be is not an absolute right, but a conditional one - condition regarding pre-deposit is made with a view to regulate the exercise of the right of appeal so as to enforce the order appealed against in case the appeal is ultimately dismissed - Section 35F of the Act has retrospective operation and is not restricted to only prospective cases. It applies to all lis which have commenced prior to or after the enforcement of the amendment, except to cases covered under the second proviso thereof – in view of the insertion of second proviso to amended Section 35F of the Act, it is held that the same is in the nature of a saving clause, keeping intact the earlier provision of Section 35F to be made applicable to circumstances noted under the second proviso. That in all other cases not covered under the second proviso, the amended Section 35F is applicable as it has a retrospective operation. Such a legislation by amendment having a retrospective operation is a valid piece of legislation - As the amended Section 35F has a retrospective operation and none of the petitioners herein has filed an appeal prior to 6/8/2014 before the appellate authority or if the appeal has been preferred subsequently has not deposited the requisite pre-deposit before the appellate authority, as the case may be, they are required to comply with the conditions of the amended Section 35F - The circulars dated 16/9/2014 and 4/10/2014 are also upheld insofar as they are in consonance with this order – Writ petition dismissed

 

2015-VIL-478-P&H-CE

M/s SANDLEY INDUSTRIES Vs UNION OF INDIA

Central Excise – Validity of Sub-rule 3A of Rule 8 of Central Excise Rules, 2002 – Payment of unpaid duty amount without utilizing CENVAT Credit – HELD - Rule 8(3A) of the CER, 2002 to the extent it contains the words 'without utilizing the CENVAT Credit' is held to be arbitrary and unreasonable and is struck down - the unamended Rule 8(3A) of 2002 Rules whereby the benefit of CENVAT Credit for all the period till the actual payment was made, stands disallowed in the event of a minor default also is arbitrary and unreasonable – Judgment of Indsur Global Limited's case followed – Assessee petition allowed

 

2015-VIL-601-CESTAT-BLR-CE

CCEC&ST, BANGALORE-I Vs MAHINDRA REVA ELECTRIC VEHICLES PVT LTD

Central Excise – Export Battery Operated Cars – Denial refund of accumulated modvat credit – HELD - the final product became exempted from 01.03.2008 and there were other various duties like National Calamity Contingent duty, Edu cess and SHE Cess which the appellant was required to pay. They have paid the duties out of the accumulated cenvat credit and as such they were in a position to use the same - issue as to whether the unutilized accumulated credit can be refunded to the assessee in case of exports made by them stands fully and finally decided in favour of the assessee – Revenue appeal dismissed

 

2015-VIL-602-CESTAT-CHE-ST

M/s IMCOLA EXPORT LTD Vs COMMISSIONER OF SERVICE TAX, CHENNAI

Service Tax - exempted services covered by Notification No.41/2007-ST, not availed prior to export of the goods – denial refund of service tax paid thereon – HELD - Appellant submitted that export is its only activity of the appellant which is not controverted by other side. If the refund is not given in one quarter that shall be given in the next quarter, which is not in doubt. Therefore, embargo by the procedure would be a barrier to get the export incentive through refund of the service tax paid. There being no one-to-one relationship prescribed by the notification between the input service and export, denial of refund shall be a hurdle to the export – assessee appeal allowed

 

The Odisha Value Added Tax (Amendment) Act, 2015 - Amendment in Section 9, 10, 11, 16, 20, 25, 27, 30 to 33, 39, 41, 42, 43, 50, 54, 57 to 59, 65, 77 and Insert Section 42A and omit section 30 [Download link, if require ask for pdf file]

 

4^th of Nov

 

2015-VIL-479-KAR

THE STATE OF KARNATAKA Vs M/s UNITED BREWERIES LTD

Karnataka Sales Tax Act, 1957 – Goods – Trade mark/Brand name - intangible goods – ‘brand franchise fees’ as ‘goods’ within the meaning of transfer of right to use the goods – Leviability of tax on “brand franchise fees” charged by the assessee from the Contract Bottling Units (CBUs) for manufacturing beer under the brand name/trade name of the assessee - transfer of right to use goods in the form of brand name/trade name – HELD – the assessee has not transferred any right to the manufacturer of beer to exploit the brand name for its own use. The manufacturers (CBUs) do not get effective control of the brand name for full commercial exploitation. As such, it cannot be considered as ‘sale’ of intangible goods by the assessee, which would be subject to Sales Tax under the KST Act - the use of brand name is not independent of the main contract and there is no exclusive transfer of right to use such branch name to any of the CBUs. At all times, the ownership of the brand name always wrests with the appellant only - levy of tax, penalty and interest, in the case of manufacture of beer, on the amount received by the assessee as ‘brand franchise fees’ from CBUs for the assessment years in question, cannot be justified in law – Revenue appeal dismissed

 

2015-VIL-481-ALH

M/s CENTRODORSTORY (INDIA) PVT LTD Vs STATE OF U.P.

Uttar Pradesh Value Added Tax Act – Section 15 (4) - Denial of refund of the excess admissible input tax credit under Section 15(4) of the Act on the ground of pending final assessment – HELD - the excess amount of admissible input tax credit shall be refunded to the dealer according to the tax return of the last period - It is not necessary for the Assessing Authority to wait that the final assessment order to be passed - writ petition allowed

 

2015-VIL-480-GUJ-CE

COMMISSIONER OF CENTRAL EXCISE, VAPI Vs PARLE AGRO PVT LTD

Central Excise & Service Tax - Whether High Court of Gujarat has the jurisdiction to entertain and decide the appeal against Tribunal order in a case where the assessee whose manufacturing unit from which the dispute arises is situated at Silvassa in the Union Territory of Dadra and Nagar Haveli, and where the Order-in-Original had been passed by the Commissioner of Central Excise and Customs, Vapi and the appeal against the said order has been decided by the Tribunal at Ahmedabad – HELD - The peculiar situation that arises in the present case is that while all adjudicating authority and all the appellate authorities are situated within the territorial jurisdiction of the State of Gujarat, the manufacturing unit in relation to which the dispute arose is situated in the Union Territory of Dadra and Nagar Haveli - since the matter arises in relation to the Union Territory of Dadra Nagar and Haveli, under the provisions of section 35G(1) read with section 36(b)(iii) of the Act, it is the High Court at Bombay which would be the High Court having jurisdiction to entertain and decide an appeal against the order passed by the Tribunal - no case has been made out for referring the matter to the Larger Bench - application stands disposed of accordingly

 

2015-VIL-605-CESTAT-DEL-CE

JINDAL STEEL & POWER LTD Vs CCE, RAIPUR

Central Excise - Cenvat credit on JO Trucks and concrete sleepers – HELD - since JO Truck is not to be categorised as ‘motor vehicle’, the exclusion for vehicles provided in the definition of input will have no application and the appellant will be eligible to take cenvat credit on the JO Trucks, since the said specially designed trucks have been used within the factory for movement of goods between the different plant facilities - With regard to concrete sleepers used for laying railway lines within the factory premises, the said item is not falling under the exclusion clause of the definition of input and as such by nature of its use and its participation in the manufacture/ production of the excisable goods, the same should be considered as input for the purpose of taking cenvat credit - appeal is allowed in favour of the appellant

 

2015-VIL-606-CESTAT-DEL-CE

M/s BARODIA PLASTIC PVT LTD Vs C.C.E. ROHTAK & C.C.E. DELHI-III

Central Excise – denial of remission of duty – accidental fire - HELD - With regard to the intimation to the Department it is a fact on record that fire continued from 17th to 18th April 2002. Only on 19th April 2002 appellant could have intimated to the Department but inadvertently they failed to intimate the Department. As 20th and 21st April were holidays, therefore, appellant could intimate to the Department only on 22.04.2002. Not giving intimation on 19th April will not be fatal for claim of remission of duty when it is the fact on record that fire took place in the premises of the appellant. Therefore, claim of remission of duty cannot be denied on this ground - issue whether appellant has taken proper care or appellant has aided and abetted to invite fire accident to avoid payment of duty – No prudent men would invite fire accident to avoid payment of excise duty. It is a fact on record that fire accident took place due to short circuit in electric wire. The, short circuit in electric wire is not in the hand of a man who could avoid such accident. Therefore, it cannot be the reason that appellant failed to take necessary steps to avoid fire accident. Therefore, on this ground also claim of remission of duty cannot be denied - On the issue of claim received by the appellant from Insurance Company appellant has produced the document on record that insurance company has not sanctioned the amount of duty as claim of insurance to the appellant. In these circumstances, it cannot be said that appellant has received duty element in their insurance claim. Therefore, on this ground also claim of remission of duty cannot be denied - appellant is entitled for claim of remission of duty – Appeal allowed

 

2015-VIL-603-CESTAT-DEL-ST

M/s INDIA GUNITING CORPORATION Vs THE COMMISSIONER SERVICE TAX, DELHI

Service tax on ‘commercial or industrial construction’, ‘construction of complex service’ and ‘maintenance of road’ services – HELD - in consequence of the decision of the Hon’ble Supreme Court in the case of Commissioner of Central Excise and Customs, Kerala Vs. L&T Ltd. on taxability of works contract prior 1st June 2007 which the original authority did not have as a guide when adjudicating the show cause notices, each of the contracts undertaken by the appellant would need to be examined for taxability itself - the original authority to scrutinize the nature of each of the works covered in the show cause notice for excluding demand on works contracts prior to 1st June 2007 and to re-examine whether any of the repairs and alteration contracts relate to buildings that are being rented out to public offices for exclusion from demand. The appeal is, thereby, allowed by way of remand to the original authority

 

Guest Article

Draft Registration Procedure under GST – There is a scope for improvement

 

wbCir919

West Bengal: Extension of the last date of filing VAT Return for Q.E. 30/09/2015

 

rajNoti96

Rajasthan: Amendments in Rajasthan Investment Promotion Scheme, 2014

 

rajNoti97

Raajsthan: Amendment in FD order No. F.12(28)FD/Tax/2010-Pt.-I-115 dated 08.10.2014 related to clause 2(XXXii) of RIPS 2014

 

hpDraftNoti5

Himachal Pradesh: Draft amendment in HPVAT Schedule 'A'

 

5^th of Nov

 

2015-VIL-482-KER

FLIPKART INTERNET PRIVATE LIMITED Vs STATE OF KERALA

Kerala Value Added Tax Act – Penalty under section 67 for breach of provisions of Sections 20 and 40 of the KVAT Act in not getting itself registered as a dealer under the KVAT Act and not filing returns and maintaining true and correct accounts as mandated under the said Act – e-commerce transaction – HELD – A mere perusal of the show cause notice would indicate that rather than stating the reasons that prompted the revenue authorities to suspect an evasion of tax, and calling for the explanation of the assessee to those reasons, the notice proceeds to draw definite conclusions as regards the commission of an offence by the assessee – show cause notices issued by statutory authorities, more so when they propose the imposition of penalty on an assessee, cannot pre-determine the guilt of an assessee - there is no consideration of the specific contention of the petitioner that the sales in question were effected by sellers who were registered on its online portal, and that all the said sales were inter-state sales on which the respective sellers had paid applicable tax under the CST Act. A specific finding on the above issues, was necessary to clothe the authority concerned with the jurisdiction to proceed against the petitioner under the penal provisions of the KVAT Act, and the absence of a finding on these issues, denudes the authority concerned of such a jurisdiction – Demand and penalty set aside - Assessee writ petition allowed

 

2015-VIL-120-SC-CE

M/s MERIDIAN INDUSTRIES LTD Vs COMMISSIONER OF CENTRAL EXCISE

Central Excise – Clearance of cotton yarn from EOU to DTA – Appellant took benefit of Notification No.8/97-CE, dated 01.03.1997 and paid duty at concessional rate – manufacture from indigenous raw material - Exemption Notification – 'consumables' and 'raw material' - HELD - The appellant is seeking the benefit of exemption Notification No.8/97-C.E. Since it is an exemption notification, onus lies upon the appellant to show that its case falls within the four corners of this notification and is unambiguously covered by the provisions thereof - such exemption notifications are to be given strict interpretation and, therefore, unless the assessee is able to make out a clear case in its favour, it is not entitled to claim the benefit thereof. Otherwise, if there is a doubt or two interpretations are possible, one which favours the Department is to be resorted to while construing an exemption notification - Imported wax is not used as consumable but used as raw material for manufacture of cotton yarn – Assessee is not eligible for exemption – assessee appeal dismissed

 

2015-VIL-121-SC-CE

COMMISSIONER OF CENTRAL EXCISE, CHENNAI Vs M/s NEBULAE HEALTH CARE LTD

Central Excise - SSI Exemption – Assessee in addition to manufacturing goods on their own account, also doing job work of manufacturing goods of other parties on job work basis and availed the benefit of MODVAT / CENVAT credit as well – whether availing the benefit of MODVAT / CENVAT credit in respect of branded goods of third parties manufactured by the assessees on job work basis, disentitles them from availing the benefit of the SSI exemption Notifications – HELD - Once excise duty is paid by the manufacturer on such branded goods manufactured, the brand name whereof belongs to another person, on job work basis, the SSI Unit would be entitled to CENVAT/MODVAT credit on the inputs which were used for manufacture of such goods as on those inputs also excise duty was paid. To put it otherwise, these branded goods manufactured by the SSI Units meant for third parties are regulated by the normal provisions of excise law and will have no bearing or relevance insofar as availing the benefit of those exemption notifications in respect of its own products manufactured by the SSI Units is concerned - Revenue appeal dismissed

 

2015-VIL-122-SC-CE

COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX Vs M/s ADITYA BIRLA NUVO LTD ETC

Central Excise - Textile articles - Exemption Notification No. 38/2003-CE dated 30.04.2003 - process subsequent to purchase – HELD - The only question is as to whether process was undertaken by assessee after the purchase of material. The submission of the Department in this behalf is that since it is the assessee who had assigned the work, that is fabrication of the apparel etc. to the job workers with the supply of material as well, and the job workers after undertaking the job had supplied the said material back to the assessee, this does not amount to purchase - As per the Apex court judgement in Ujagar Prints, for the purpose of arriving at the value of the job at the hands of job workers, factory gate is treated as "deemed" factory gate as if the processed fabric was sold by the assessee. It cannot be disputed that the fact situation in these cases is identical where the job workers had paid the excise duty at the time of supply of these processed fabric to the respondent assessee. Once that could be treated as sale, the necessary corollary is that so far as the assessee are concerned, they had purchased processed fabric from the job workers and, therefore, would satisfy the condition of "subsequent purchase" for Notification No. 38/2003 - benefit of exemption notification is rightly extended by the Tribunal to the assessee - Revenue appeal dismissed

 

2015-VIL-608-CESTAT-MUM-ST

KINGFISHER AIRLINES LTD & JET AIRWAYS LTD Vs COMMISSIONER OF SERVICE TAX

Service Tax – Majority order - Taxability of excess baggage charges collected by the appellants-airline – HELD – carrying of baggage by the appellant Airlines is incidental to the service being ‘transport of passengers by Air' and the same is classifiable under Section 65(105)(zzn). There is no separate contract in the facts of the case for transport of goods (excess baggage). More particularly, in the case of agreement of transport of passengers by Air, there is no element of transport of unaccompanied goods. Thus, agreeing with the learned Member (Judicial), the excess baggage charges collected by the appellant Airlines is integral part of the service provided for ‘transport of passengers by Air' - extended period - the issue is one of interpretation of the taxing statute and as such being debatable, there is no element of any fraud or suppression. Accordingly, the extended period of limitation is not invocable - imposition of penalties - there being no deliberate defiance of the provisions of law or non-compliance with the provisions of law, none of the penalties are attracted – Appeal allowed

 

2015-VIL-607-CESTAT-MUM-ST

MORMUGAO PORT TRUST Vs COMMISSIONER OF CENTRAL EXCISE & SERVICE TAX, GOA

Service Tax – assessee has leased out vacant Port land and water area for the use of the lessee and granted permission for construction of dry dock, jetty for commercial exploitation – whether such activity of leasing of vacant land would fall under service tax net as claimed by the revenue – HELD - exclusion clause (b) under Explanation 1 to the definition under Section 65(105)(zzzz) of Finance Act, 1994 does not envisage any restriction as it is to be put for non-commercial use - the activity of leasing out vacant land will not be covered under the category of renting of immovable property - Assessee appeal allowed & Revenue appeal rejected

 

mpOrdi6

Madhya Pradesh VAT (Second Amendment) Ordinance, 2015 - Insertion of new Section 9-AA - Levy of additional tax on goods specified in Schedule-II

 

mahaCir16T

Maharashtra: Revision in rates of Maharashtra Value Added Tax

 

gujEreturn

Gujarat: Regarding time limit to file E-Return

 

gujEpayment

Gujarat: Regarding e-Payment above Rs.10 Lacs

 

7^th of Nov

 

stNoti21

Service Tax: Date of effect of section 119 of the Finance Act, 2015 - Swachh Bharat Cess

 

stNoti22

Service Tax: Applicability and rate of Swachh Bharat Cess

 

2015-VIL-483-AP

A.C. TRADERS Vs THE STATE OF ANDHRA PRADESH AND ANOTHER

Central Sales Tax Act – turnovers on account of export as well as inter-State sales - Rejection of exemption - non-filing necessary declarations Form – Filing of C-forms after passing of the Assessment Order – HELD – Declaration filed even after passing of the Assessment Order, deserves to be considered - a liberal approach ought to have been adopted, though statutorily a period of three months has been prescribed for filing of declaration in terms of Section 6A read with Rule 12(7) of the Rules. However, the very fact that discretion had been given to the Assessing Officer to make an exception to the Rule would itself indicate that the same need not be viewed in a rigid manner. In that view of the matter, the Endorsements cannot sustain so far as the issue with regard to the C-forms is concerned and same are set aside - Respondent is directed to take into consideration the C-forms filed by the petitioner and pass appropriate orders by modifying the Assessment Orders – Writ petition allowed

 

2015-VIL-484-KER

M/s COCHIN BLUE METAL INDUSTRIES (P) LTD Vs THE INTELLIGENCE OFFICER

Kerala Value Added Tax Act – Section 74 - Composition of offences - Vertical Shaft Impactor machine - whether the petitioner can escape from his liability to pay the compounding fee by placing reliance on a subsequent declaration of law by this court - claim for reduction in the fee payable by invoking the provisions of the proviso to section 74 (1)(a) of the KVAT Act – HELD - Having obtained the statutory benefits flowing from the composition of the offence, the petitioner cannot now turn around and question the very proposal for imposition of penalty, based on a subsequent judgment of this Court - legislative history clearly indicates that while there were two amendments, that enhanced the compounding fee payable under section 74 (1)(a) on both those occasions the amending body did not deem it necessary to amend the proviso to the said provision. Thus, the proviso has to be read as it stands in the statute book, and when so read, the compounding fee payable by the petitioner is only in an amount of Rs. 2 Lakhs instead of 8 lakhs - The writ petition is thus partly allowed

 

mahaNotiCR81

Maharashtra Value Added Tax (Second Amendment) Rules, 2005 - Amendment in Rule 88 - Rates of interest for the purposes of sub-sections (1), (2) and (3) of section 30 of MVAT Act

 

Guest Article

Swachh Bharat Cess @ 0.5% on value of all taxable services levied from November 15, 2015

 

October Month Summary

List of updates in the month of October ‘15

 

delAdvisory

Delhi: Advisory to casual dealer

 

mahaNotiCR81

Maharashtra Value Added Tax (Second Amendment) Rules, 2005 - Amendment in Rule 88 - Rates of interest for the purposes of sub-sections (1), (2) and (3) of section 30 of MVAT Act

 

ceNoti43

Central Excise: Hike in Excise duty on Petrol & Diesel

 

9^th of Nov

 

mahaCir17T

Maharashtra: Physical Submission of Statement of submission and Acknowledgement of Audit Report in Form 704 for the financial year 2014-2015

 

cestatNoti02

CESTAT: Constitution of Bench at Chandigarh

 

Guest Column

Payments under GST - Business Process

 

10^th of Nov

 

2015-VIL-23-MSTT

M/s SONY MUSIC ENTERTAINMENT (INDIA) PVT LTD Vs THE STATE OF MAHARASHTRA

Maharashtra Value Added Tax Act - Maharashtra Tax on the Transfer of Right to Use any Goods for any Purposes Act, 1985 - Appellant-company carries on the business of manufacturing audio cassettes, audio CDs, DVDs, etc. and also deals with administering the music rights - levy of sales tax on the receipt of the amount received by the appellant from the copyright societies – Grant of public performance rights – grant of wholly and absolutely the copyright for public performance and also mechanical rights of its musical works and grant of non-exclusive authorization for administration of its authorized rights to the society in its music catalogue for the purposes of better and effective administration of the said music catalogue – Levy of sales tax on such agreement – HELD - All these three agreements clearly go to show that the right to use the musical works and the cinematographic rights as well as copyright work assigned by the Appellant to the assignee and in pursuance of the said transactions, the Appellant company was to receive royalty as well as the amount of money collected by the societies for execution of such rights. Even if some rights are retained by the Appellant-company, that by itself does not mean that the transaction is not covered by the provisions of right to use any goods for any purposes Act (Lease Act), 1985. The observations of the Hon’ble High Court in Tata Sons Ltd. case are perfectly and squarely applicable to the facts of the present case - transactions executed by the Appellant-company with M/s. PPL and M/s. IPRS society are exigible to levy of tax under the provisions of Lease Act, 1985 – Demand, interest and penalty confirmed – In favour of Revenue

 

2015-VIL-611-CESTAT-MUM-CE

JSW STEEL LTD Vs COMMISSIONER OF CENTRAL EXCISE, NAVI MUMBAI

Central Excise - Appellants are manufacturing excisable goods and also clearing blast furnace gases availing full exemption – Revenue contention that assessee are hit by the mischief of rule 6 Cenvat Credit Rule in case an exempted byproduct is sold by appellants – HELD – The argument of the appellant is that the Hon’ble Apex Court has interpreted the sub-rule (1) of rule 6 to mean that credit of that quantity of inputs which are necessary to manufacture the intended quantity of final product will be allowed. If in that process certain unintended byproducts emerge as a technical necessity then it cannot be said that part of the said inputs have been used in Manufacturer of the byproducts. In other words the credit of that quantity of raw materials shall be allowed which is required for manufacture of the intended quantity of final products, irrespective of the fact that certain byproducts emerge as technical necessity – The Apex Court in Hindustan Zinc Ltd has laid down the ratio that when a byproduct emerges as a technical necessity, it cannot be said that any inputs have been used for the Manufacturer of the byproduct. The ratio of this judgement clearly applies to the facts of the impugned case. Moreover on perusal of the clarification dated 3.4.2000, it is seen that CBEC Circular also agrees with the said ratio laid down by the Hon’ble Apex Court – Assessee appeal is allowed

 

2015-VIL-610-CESTAT-DEL-CE

C.C.E. LUDHIANA Vs M/s NUCON SWTICH GEARS PVT LTD

Central Excise – Cenvat Credit – Denial of credit on SE copper wire as same is not dutiable – HELD - As the respondent-assessee has paid the duty on SE copper wire purchased from the supplier and taken the Cenvat Credit. Although SE Copper wire is not dutiable but the respondent has paid the duty, they have taken Cenvat Credit correctly as per Rule 3 of the Cenvat Credit Rules 2004 – Revenue appeal dismissed

 

2015-VIL-604-CESTAT-DEL-ST

GENERAL MANAGER, BHARAT SANCHAR NIGAM LTD Vs C.C.E, RAIPUR

Service Tax – Demand on the ground that the appellant had adjusted the amount of service tax paid in excess towards payment of service tax in the subsequent period in terms of Rule 6 (3) of Service Tax Rules, 1994 although it had not satisfied the condition of the said Rule which required the assessee to refund the value of the taxable service and the service tax paid thereon to the person from whom it was received – HELD - the appellant was entitled to adjust the service tax paid in excess if it had refunded the value of taxable service and service tax thereon from whom it was received. It has been noted by the primary adjudicating authority that the excess payment of service tax was not in relation to any amount recovered for rendition of service from any customer nor was the service tax paid in excess recovered from the customers as it was paid due to calculation errors. The adjustment made by the appellant is not in violation of the said Rule – appellant entitled to such adjustment - appeal allowed

 

2015-VIL-609-CESTAT-AHM-ST

CCE&ST, SURAT Vs M/s SHREE GANESH PIGMENT PVT LIMITED

Service Tax - Whether the service tax paid on Effluent Treatment Plant (ETP) services, provided by various ETP Service providers is eligible as input service or otherwise – HELD - issue is no more res-integra - the Tribunal has held in affirmative, in the case of Commissioner of Central Excise & S.T., Surat vs. M/s. Kanoria Chemicals and Industries Limited - treatment of effluent from a factory has to be considered as essential and integral part of the process of manufacture - appeal filed by the Revenue is rejected

 

2015-VIL-485-GUJ-ST

GOPALA BUILDERS Vs DIRECTORATE GENERAL OF CENTRAL EXCISE INTELLIGENCE

Service Tax - Recovery under section 87 of the Finance Act – HELD - Recovery under section 87 of the Act can be resorted to only after an amount is adjudicated to be due to the Central Government. Under the circumstances, at the stage of show cause notice when the liability of the petitioner is yet to be crystallized, it was not permissible for the respondents to resort to the drastic provisions of section 87 of the Act - Besides, no demand notice had been issued to the petitioner and directly garnishee orders had been issued to the clients of the petitioner. Such course of action adopted by the respondents, evidently, would bring the petitioner to disrepute and spoil its reputation in the business. Therefore, the action of the revenue of resorting to the provisions of section 87 of the Act was not warranted in the facts and circumstances of the case. The impugned notices collectively to the petition, being contrary to the provisions of section 87 of the Act, cannot be sustained – Assessee petition allowed

 

Guest Article

Settle Past Disputes Before GST Introduction

 

cestatNoti3

CESTAT: Constitution of Bench at Hyderabad

 

FCP0911

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

 

stCir187

Service Tax: Speedy disbursal of pending refund claims of exporters of services under rule 5 of the CENVAT Credit Rules, 2004

 

HIMACHAL PRADESH NOTIFICATION

hpNoti16071115: Himachal Pradesh Value Added Tax (4th Amendment) Rules, 2015 - Insertion of new rules 75 B, 75 C, 75 D, 75 E and 75 F

hpNoti8071115: Himachal Pradesh Tax on Entry of Goods into Local Area Act, 2010 - Amendments in Schedule-II - Regarding All Industrial Inputs, raw material and packing material

 

12^th of Nov

 

2015-VIL-124-SC

M/s NAVAYUGA ENGINEERING COMPANY Vs ASSISTANT COMMISSIONER (COMMERCIAL TAXES), LTU

Sales Tax: The assessment orders were passed by the assessing authority of the State of Andhra Pradesh. Now the demand is created by authorities by the State of Telengana - If the petitioner, for any reason, fails in Writ Petition that is pending before the High Court, they would not be in a position to file an appeal against the assessment order(s) either in the State of Andhra Pradesh or in the State of Telengana - the submission made by the petitioner-assessee is accepted - the assessment order(s) is set aside and reserve liberty to the assessing authority of the concerned State to pass appropriate orders depending upon the result of the Writ Petition - Accordingly, the impugned judgment and order passed by the High Court is set aside - the concerned state assessing authority to complete the assessments after disposal of Writ Petition - We further request the High Court that while disposing of Writ Petition to keep in view Clause III(i) of Schedule V of the Andhra Pradesh Infrastructure Development Enabling Act, 2001 and also the Andhra Pradesh Re-Organisation Act, 2014 - we want to remind that authorities under the Act to keep in view the observations made by Supreme Court in the case of M/s. Vadilal Chemicals Ltd. vs. State of A.P. while interpreting covenants in the agreement between the parties - The Review Petitions are disposed of accordingly

 

2015-VIL-24-MSTT

M/s VICCO PRODUCTS (BOMBAY) LTD Vs THE STATE OF MAHARASHTRA

Bombay Sales Tax Act – Prospective effect of Tribunal order - classification of three products i.e. tooth powder, tooth paste and turmeric cream – HELD - the tribunal has upheld the determination order by holding that, M/s. Vicco Vajradanti is covered by entry C-II-36 and Vicco Turmeric cream is covered by entry C-II-86 - It is to be noted that the first appellate authority has not taken into consideration the contention raised by the appellant regarding benefit of prospective effect claim by the appellant. Since the tribunal has extended upto 30/04/1996. In view of the extension of the prospective effect the products in question should have taxed as medicine @6% as the appellant under bonafide belief presumed that the impugned products would be treated as medicines - the appellant is entitled to seek benefit of prospective effect upto 30/04/1996 – Levy of Purchase Tax and penalty - The purchases effected on “BC” forms and which were in closing stock on 28/02/1996 were disclosed by the dealer at the time of assessment. Therefore, one cannot draw conclusion that, it is concealment which was not entered into the books of account. It does not suffice the purpose while imposing the penalty. Therefore, penalty u/s.36(2)(c) main clause is deleted in toto - For levy of sales tax on the sales effected from 01/03/1996 to 31/03/1996 prospective effect is granted subject to the collection of tax at lower rate - Levy of Purchase Tax u/s.41(2) is upheld – Penalty is deleted - Levy of interest u/s.36(3)(a) is upheld as there is no refund claim to apply out of pocket theory – Appeal partly allowed

 

2015-VIL-614-CESTAT-MUM-CE

M/s LUPIN LTD Vs COMMISSIONER OF CENTRAL EXCISE & SERVICE TAX, MUMBAI

Central Excise - Refund of education cess - adjudicating authority rejected the refund claim on the ground that the notification No. 56/2002-CE does not exempt education cess and Secondary and Higher Education cess as it exempt only basic excise duty - area based exemption – order in the case of Bharat Box Factory Ltd -  HELD – this Tribunal in case of Bharat Box Factory Ltd passed the judgment way back in 2007 and eight years already passed - The Revenue could not obtain any stay against the order - this Tribunal is heavily burdened with huge pendency of appeals. There is no provisions that if either litigant approached to the higher forum in a finding case without any stay matter, this Tribunal keep the identical matters in abeyance - wheel of justice should not stop, therefore no reason that appellant should suffer despite order of this Tribunal in Bharat Box Factory case is in their favour - Education Cess is in nature of piggy back of duty which could not operate in respect of excise duty exempted under the relevant law. When the entitlement to exemption of duty of excise or additional duty of excise which would otherwise being payable under 3(x) in Notification No. 56/2002-CE is undisputed, no duty of education Cess arises in nature of excise duty under section 93 of Finance Act, 2004. Education cess not to be refunded as no provisions or it returns in notification ibid is not sustainable - the appellant is entitled for the refund of education cess and secondary and higher education cess paid on clearances of the goods under Notification No. 56/2002-CE - Therefore orders in appeal are set aside – assessee appeal allowed

 

2015-VIL-612-CESTAT-MUM-CE

LARSEN & TOUBRO LIMITED Vs COMMISSIONER OF CENTRAL EXCISE, MUMBAI-II

Central Excise - Reversal of Cenvat Credit – Assessee debited 10% of the contract price of the goods (excluding tax) under the provisions of Rule 6(3)(b) of CCR, 2004 and collected the said amount from customer - for the purpose of reversal of 10% whether the basic contract price should be taken or price plus 10% reversal collected should be taken – HELD - There is clause in the purchase order that against all the reversal of 10% customer shall pay the same amount to the appellant. In view of this fact contract price is the price and the same should be taken for calculation of 10% reversal required under 6(3)(b). As regard the 10% reversal made by the appellant and even though the same was collected from the customer the same was not retained by the appellant as the same was debited in their Cenvat credit account, therefore in this fact, it could not be said that 10 % reversal is part and parcel of the price of the goods - Prior to 1/4/2008 the price of which 10% reversal was to be made had no relevance to the Section 4 or 4(A) and it is also fact that term “price” mentioned in the Rule 6(3)(b) it was not defined in the Cenvat Credit Rules - price is to be taken as provided in the contract and as per contract; price does not include 10% reversal and collection thereof. Therefore 10% reversal made by the appellant on basic contract price is correct and legal – Assessee appeal allowed

 

2015-VIL-123-SC-CE

COMMISSIONER OF CENTRAL EXCISE, ALLAHABAD Vs M/s TRIVENI GLASS LTD
Central Excise - Valuation – Credit Notes - Refund – HELD - The credit notes issued on a monthly basis were the result of settling of rate. Lower authorities have not rightly understood the nature of transaction, that sale price was provisional at the time of original removal of the goods and was subsequently settled by issue of credit notes. They were in error in holding that price was known at the time of removal and issue of credit notes only indicated post-sale revision of prices. According to Section 4 of the Central Excise Act, in a case of sale of goods, the transaction value is to constitute the assessable value. The appellant's transactions with their dealers are clearly cases of sale and that transaction value is the value determined after issue of credit notes. The account of each dealer is settled every month at the rate discounted by the credit note amount. There was no further amount paid or payable over and above that net amount. Therefore, the discounted amount, net of the credit note, was required to be treated as assessable value – Revenue appeal dismissed

 

2015-VIL-613-CESTAT-MUM-ST

JAIN IRRIGATION SYSTEMS LTD Vs COMMISSIONER OF CENTRAL EXCISE, MUMBAI

Service Tax – Refund – Export of goods - denial refund of an amount of service tax paid for the services rendered by the service providers at the place of destination - Notification 41/2012-ST – HELD - It is undisputed that the appellant exported the excisable goods and utilized the services for such export and the place of removal in the case in hand is factory gate. It is also undisputed that in some of their client’s case, appellant had accepted the terms of delivery of the goods till the door steps of the clients. It would mean that the appellant was responsible for the delivery of the goods in the hands of the appellant’s clients. Hence services received by the appellant for such activity is eligible for refund under Notification 41/2012-ST - similar issue in the case of Polyplex Corporation Ltd held in favour of the assessee - impugned orders are set aside to the extent they are contested before the Bench and the appeals are allowed

 

2015-VIL-615-CESTAT-BLR-ST

NEOTECH RUBBER PRODUCTS & NEODAM RUBBER PRODUCTS PVT LTD Vs CCCE&ST, HYDERABAD-IV

Service Tax - Appellants engaged in the activity of re-rubberisation of old, worn out rubberized rollers. As per the appellant the said activity falls under the category of Business Auxiliary Service, attracting ‘nil’ rate of duty in terms of an amended Notification No. 14/2004, whereas the Revenue has classified the same as Management, Maintenance or Repair Services liable to pay service tax – HELD – following the dcisions of the Tribunal in the case of Zenith Rollers Ltd. Vs. CCE, Noida, the activity undertaken by the appellant falls under Business Auxiliary Service in which case they are exempted from payment of service tax in terms of Notification No. 14/2004. Accordingly the impugned orders are set aside and appeals are allowed with consequential relief to the appellant – Assessee appeal allowed

 

rajNoti1892

Rajasthan: Extension in date of submission of quarterly return in Form VAT 10, for the second quarter of the year 2015-16

 

kerCir26

Kerala: Multi-level Marketing Entities – Registration, payment of tax at Compounded rates - Operational guidelines

 

Guest Article

Summarized Checklist for VAT on Works Contract in somemajor States

 

tnOrderGO93

Tamil Nadu: Constitution of State Level Tax Payers Advisory Committee

 

13^th of Nov

 

stNoti23

Service Tax: Amend notification No.22/2015-ST dated the 6th November, 2015 so as to specify that Swachh Bharat Cess will be calculated on abated value

stNoti24

Service Tax: Provide provisions of notification No. 30/2012 - Service Tax dated the 20th June,2012 shall be applicable for the purposes of Swachh Bharat Cess

stNoti25

Service Tax (Second Amendment) Rules, 2015 - Provides composition rate for Swachh Bharat Cess as applicable to ST under sub-rules 7,7A,7B,7C of rule 6 of Service Tax Rules, 1994

 

delNoti1014

Delhi: Extension in last date for filing of online return for 1st & 2nd quarter of 2015-16 upto 30th Nov

 

SBCfaq

Swachh Bharat Cess - Frequently Asked Questions

 

Guest Article

Clarifications on various aspects of Swachh Bharat Cess

 

telCir172

Telangana: Mandatory usage of e-waybills by VAT dealers

 

16^th of Nov

 

2015-VIL-486-KAR

THE STATE OF KARNATAKA Vs M/s MANYATA PROMOTERS PVT LTD

Karnataka Value Added Tax Act - Section 20 and Rule 130-A - Benefit of refund of tax paid on purchase of inputs as Special Economic Zone Developer – Claim of input tax credit beyond six months – HELD - Section 35 makes it clear that there is no requirement for the purchasing dealers to claim input tax credit in the same month in which the date of the invoice of the supplier or vendor falls. Section 35(1) makes it clear that every registered dealer shall furnish the return in such form and manner, and shall pay the tax due on such return within 20 days or 15 days after the end of preceding month. Nowhere in the said Section has it been contemplated that the Purchasing dealer shall claim input tax in the same month - The refund of input tax cannot be denied on the ground of belated claim - Section 20(2), which is a beneficial legislation, makes it very clear that the developer of Special Economic Zone or an Unit located in any SEZ is entitled for the refund of input tax credit or deduction from the output tax payable by such dealer. Section 20(2) does not contemplate any period within which, such developer shall claim refund of input tax. Further, Rule 130A which was inserted w.e.f. 1-4-2007 also does not contemplate the period within which the developer shall claim the refund of input tax. Section 35 cannot control Section 20(2). The benefit of beneficial legislation has to be extended to the SEZ dealers. The technicalities shall not come in the way of giving some reliefs. Hence, Section 20(2) has a over-riding effect against Section 35 of the Act - the assessee is entitled for refund of input tax credit – Revenue appeal dismissed

 

2015-VIL-617-CESTAT-DEL-CE

M/s JYOTI COPPER CRAFT PVT LTD Vs CCE, INDORE

Central Excise – appellant had wrongly availed credit on scalping machines though the machines were not available in the factory. On pointing out this, the appellant reversed the credit and informed the same to the department – Interest demand – HELD - On pointing out the defect, the appellant reversed the credit. If the appellant was liable to pay interest the department ought to have informed the same to the appellant soon after receiving the letter informing the reversal of credit. After coming to know about wrongful availment of credit on 2.1.2008 the respondent has remained in their bureaucratic slumber for almost four years - There may be many reasons for absence of the machines in the factory. If there was fraud it is for the department to establish the same. In a catena of judgements, the Supreme Court has clarified that when the fact is within the knowledge of the department, the extended period of limitation is not invokable - the credit when reversed before utilization of the same would amount to not taking credit - department has not been able to establish fraud, or suppression with intention to evade payment of duty so as to invoke extended period - the demand is barred by limitation. As the issue of limitation is answered in favour of the appellant, not necessary to enter into the merits of the case – Assessee appeal allowed

 

2015-VIL-616-CESTAT-AHM-ST

M/s AMRIT CRANE SERVICE Vs CCE&ST, VADODARA

Service Tax – Cenvat Credit – Appellant initially paid the service tax by way of crediting cenvat credit which was irregular and on being pointed out they made good by making payment through cash – Request for re-credit the cenvat credit, once they paid the duty amount by cash – HELD – Assessee is allowed to take re-credit by crediting CENVAT account only after actual payment in cash/from P.L. Account is made - appellant is liable to pay interest from the date of liability of tax to the date of payment of same through cenvat credit - As regards penalties, it is observed that the provisions were amended in July 2011 and the appellant had discharged the service tax liability in November and December 2011 albeit, through cenvat credit. Therefore, there is force in the arguments of the learned Counsel that the appellants were not aware of the amended provisions and there was no intention to evade tax. Hence, imposition of equivalent penalty under Section 78 of the Finance Act, 1994 is not warranted and the same is set-aside – Appeal partly allowed

 

Guest Column

Proposed payment process under GST

 

mpNoti35

Madhya Pradesh: Levy of additional tax on Petrol

 

mpNoti36

Madhya Pradesh: Draft amendment in MPVAT Schedule-II

 

17^th of Nov

 

stCir188

Service Tax: Accounting code for payment of Swachh Bharat Cess

 

delNoti907

Delhi Value Added Tax (Amendment) Rules, 2015 - Amendment in Rule 7 & Form DVAT-16

 

delNoti906

Delhi Value Added Tax (Amendment) Rules, 2015 - Amendment of Form DVAT-16, Form DVAT-30 & Form DVAT-31

 

delCir29

Delhi: Extension in date for filing of online return for second quarter of 2015-16

 

18^th of Nov

 

2015-VIL-488-GAU

TATA TEA LTD Vs STATE OF ASSAM

Assam Entry Tax Act - Applicability of the Entry Tax Act on import tea from outside and blending the same with the local varieties and sells the same in packed condition – HELD - Entry 40 of the Schedule discloses that tea is specified goods. It may be that the petitioner imports the tea from outside. He paid VAT for the sale in Assam and CST tax for the sale outside the State – the view that tea imported should be sold in the same form in order to get exemption of entry tax does not appear to be a correct - By blending local varieties, there is no change in the nature of the product both for the local sale of local variety and after blending with the imported goods, VAT is paid and for inter-State sale CST is paid and the tea even after blending very much remains as specified goods - levy of entry tax on the import of tea and local sale and inter-State sale of the blended tea is untenable - impugned orders is quashed and assessee petition is allowed

 

2015-VIL-619-CESTAT-MUM-CE

MADHYADESH PAPERS LTD Vs COMMISSIONER OF CENTRAL EXCISE, NAGPUR

Central Excise – Quantum of Cenvat credit to be reversed - appellant had availed Cenvat credit of service tax paid on common input services - Appellant claimed exemption from payment of duty in respect of newsprint paper and discharged appropriate duty liability on the Kraft paper – HELD – under Rule 6 of the CCR if a manufacturer proportionately reverses the Cenvat credit attributable to the clearances of exempted goods, it is considered as compliance of the provisions and need not be burdened with the demand of an amount equivalent to 5% or 10% of the value of exempted goods - as the appellant has already reversed the entire Cenvat credit of service tax paid on the common input services, further demand is not in consonance with the law - the amount that has been reversed as an amount of the Cenvat credit availed on common input services along with interest. The penalties sought to be imposed on this count are unwarranted as the lower authorities have not considered the fact that the rules themselves provided for such reversal – Assessee appeal allowed

 

2015-VIL-618-CESTAT-BLR-ST

MANGALORE REFINERY AND PETROCHEMICALS LTD Vs COMMISSIONER OF CENTRAL EXCISE & SERVICE TAX, MANGALORE

Service Tax - CENVAT credit of service tax paid on construction of primary school as also ST/SC colony - Nexus with Manufacture – HELD - The construction of school and the construction of colony for the SC/ST cannot be said to be having any nexus, whatsoever, with the manufacturing activity of the appellant - The definition of ‘input services’ cannot be stretched to such an extent that it is becomes practically illogical. If such an extended meaning is given to the said definition so as to include all the activities of the appellants, whether or not relatable to his business, the definition would lose its meaning, intended to be given by the legislation - limitation - There being no positive evidence on the part of the assessee to show that there was any suppression or mis-statement with any mala fide intent, the first demand to be barred by limitation. For the same reasons, the penalty is also set aside – Appeal dismissed on merit but allowed on limitation

 

utrNoti957

Uttarakhand: Amendment in Schedule-I Agricultural implements & Distillation units

 

utrNoti477

Uttarakhand Value Added Tax (Amendment) Rules, 2015 - Amendment in Rule 19 - Regarding Manner of Payment|

 

delNoti913

Delhi: Amendments in DVAT Schedule Third & Fourth - Regarding 'Spare parts, accessories and components', Petroleum Products & ATF

 

delNoti913

Delhi Value Added Tax (Amendment) Rules, 2015 - Amendment of Rule 35

 

rajNoti100

Rajasthan:  Regarding exemption of VAT on execution of Work Contract

 

rajNoti7115

Rajasthan: Amendment in this department's notification No. F.16(100) Tax/CCT/14-15/2787 dated 21.10.2014

 

triNoti62

Tripura: Schedule II(a) and Schedule II(b) - Regarding 'pre-owned / used car'

 

tnNotiGO94

Tamil Nadu: Exemption from payment of VAT on purchase of certain goods by the Cancer Institute (Wia), chennai under TNVAT Act, 2006

 

19^th of Nov

 

punNotiSO50

Punjab: Amendment in PVAT Schedule-E - Regarding 'All automobiles' (i.e. commercial vehicles, passenger vehicles, three wheelers, two wheelers)

 

2015-VIL-490-RAJ

ASSISTANT COMMERCIAL TAX OFFICER, ZONE-II, AJMER Vs M/s SWASTIK AGENCIES
Rajasthan Sales Tax Act – Rate of tax battery – assessee contention that rate of tax is to be levied treating it to be on the rate applicable on motor-parts - general rate of tax against specific entry – HELD - The Tax Board has come to a definite finding of fact that even if some parts of Battery or Battery-parts can be said to be sold for other purposes but primarily it is meant for motorcars - general rate would not be applicable as Battery and its parts in common parlance is said to be fitted in motorcars – Revenue revision petition are liable to be dismissed

 

2015-VIL-489-GAU

PDP STEELS LIMITED Vs STATE OF ASSAM

Assam Entry Tax Act, 2008 - Section 3(2) - Exemption for payment of entry tax – Processing of imported hot rolled sheets in coil into cold rolled sheets in coil form - specified goods as mentioned in entry at serial No. 50(iv) to the Schedule – HELD - hot rolled coil, imported into local area in the State of Assam and the same is sold after processing it to a product which is called as cold rolled coil. It is found that both the products aforesaid are sold in coil form. Entry at Sl. No. 50 to the Schedule aforesaid reveals that sheets, hoops, strips and skelp, both in hot rolled coil as well as cold rolled coil, are specified goods and as such, only for changing the hot rolled coil to cold rolled coil, later does not cease to be the specified goods as mentioned in aforesaid entry and as such, the benefit under section 3(2) of the Act of 2008 needs to be extended to the petitioner provided VAT is also payable in respect of sale of such goods - the decisions rendered in the cases, relied on by the petitioner, more particularly, the decision in Tata Tea Ltd. v. State of Assam squarely cover the present case – Assessee petition allowed

 

2015-VIL-620-CESTAT-DEL-CE

HINDUSTAN ZINC LTD Vs COMMISSIONER OF CENTRAL EXCISE, JAIPUR

Central Excise - Majority order - Provisional assessment - Rule 7 of the CER, 2002 – permissibility to Appellant's request for adjustment of excess paid duty with the short paid duty during the Financial Year 2006-07 as held by Member (Technical) or such adjustments have to be allowed as held by Member (Judicial) - The facts of this case are similar to the facts in the case of Toyota Kirloskar Auto Parts Pvt. Ltd. - It is total duty payable of all the goods which are subject matter of provisional assessment and final assessment which is to be taken into consideration. After taking into consideration duty payable in respect of all goods and duty paid in pursuant to the final assessment order if still the assessee is due in any duty then for short fall in payment of duty the assessee is liable to pay interest - In this case the Adjudicating Authority has held that for the part of the period in hand the appellant has short paid the duty of Rs.3,52,78,170/- and in respect of other part of the period the appellant has paid Rs.3,53,74,279/- duty in excess. Therefore, the duty excess paid by the appellant is more than the duty short paid by the appellant. Therefore, appellant is not required to pay any duty. Consequently, interest is not payable - Findings of Member (J) agreed with - Impugned order is set aside and assessee appeal is allowed

 

2015-VIL-621-CESTAT-MUM-CE

TRACTOR ENGINEERS LTD Vs COMMISSIONER OF CENTRAL EXCISE AND CUSTOMS, PUNE

Central Excise – Cenvat Credit - manufacture of erection and installation of the furnace – Exemption under Notification 67/95-CE – HELD – Input on which Cenvat credit was availed were indeed used in manufacture of erection and installation of the furnace, in terms of definition of inputs, input includes the goods used in the manufacture of capital goods and if such capital goods used within the factory for manufacture of dutiable goods. In such case, for the furnace was exempted under Notification No. 67/95 but input used in manufacture of such furnace is clearly covered under the definition of input therefore the credit on the input used in the manufacture of furnace is admissible. However appellant has not disputed the denial of Cenvat Credit and paid the said amount admittedly and not contested - since appellant not contesting credit denial and paying the same, appeal allowed by setting aside penalty and interest – Assessee appeal allowed

 

2015-VIL-622-CESTAT-MUM-ST

RELIANCE INDUSTRIES LTD Vs COMMISSIONER OF CENTRAL EXCISE, MUMBAI-I

Service Tax – Refund – SEZ unit - Notification No.4/2004-ST & 9/2009-ST - Section 26 of SEZ Act, 2005 – Admissibility of refund of service tax paid for availment of ‘banking and other financial services’ - HELD - the provisions of section 26 of Special Economic Zones Act, 2005 are conferred with a primacy that cannot be denied, diluted or denigrated owing to delay in devising a facilitative mechanism that was agreeable to Revenue. Disregard of parliamentary intent to levy a tax or exempt a tax cannot be brooked under any circumstance. A harmonious construction of the exemption notification 4/2004-ST that preceded the Special Economic Zones Act, 2005 with that Act must perforce be the facilitative mechanism in the absence of any other. A misconceived notion, as entertained by the lower authorities about that distinction between the corporate office address and the site address, should not be allowed to hold sway when confronted with the factual matrix of its exclusive existence in a Special Economic Zone; consequently, there can be no doubt that the services provided by M/s NSDL was for the authorized operations in a Special Economic Zone - the appeal is allowed and the appellant is entitled to refund of service tax as claimed – Appeal allowed

 

2015-VIL-623-CESTAT-AHM-ST

M/s GUJARAT STATE FEDERATION OF CO. OP. SUGAR FACTORIES LTD Vs CCE&ST, AHMEDABAD

Service Tax - Club’s or Association’s Membership Services – demand of tax alongwith interest and imposed penalty under the category of ‘Club or Association Services’ under the provisions of Section 65(95a) of the Finance Act, 1994 – Collection of subscription from Members - HELD - the controversy involved in the present case, to the extent the respondents seek to invoke the provisions of section 65(105) (zzze) of the Finance Act qua the members of the petitioner, stands concluded in favour of assessee wherein the said provision has been declared ultra vires and unconstitutional and hence, to that extent the impugned show cause notice is without authority of law and, therefore, cannot be sustained – Assessee appeal allowed

 

delCir30

Delhi: Regarding the status of the forms downloaded by the dealers

 

The Rajasthan Investment Promotion Scheme, 2014 - Amended upto 03.11.2015 [Download link]

 

Presentation on GST Process (issued by Department of Revenue)

Presentation on Proposed GST Return Process

Presentation on Proposed GST Payment Process

Presentation on Proposed GST Registration Process

Presentation on Proposed GST Refund Process

 

23^rd of Nov

 

2015-VIL-495-KER

STATE OF KERALA Vs F I DESIGN & DEVELOPMENT PVT LTD

Kerala Value Added Tax Act – Work Contract – evidence to prove Intra-State Work Contract – Whether the assessee who brought the material to the State of Kerala from outside the State as part of business is liable for registration under Section 15(2)(iv) of the KVAT Act - Whether the appellant, a person engaged in contract is liable to take registration irrespective of its tax liability/turnover as per the Section 15(2)(xi) of KVAT Act – HELD - the materials available on record clearly indicates that the appellant/dealer has purchased goods from Karnataka and the same was brought to Kerala for the purpose of works contract - it is a case where the tax had been payable under the CST Act and once the dealer has suffered the liability to pay tax under the CST Act, there is no difficulty in coming to the conclusion that the Kerala VAT Act has no application – Revenue contention that the dealer ought to have registered under the Act is also without any basis as the dealer has taken a works contract, which apparently does not indicate that the dealer is required to be registered under the Kerala VAT Act as he is not carrying on any business within the State of Kerala. The works contract is different from “carrying on business” as available under Section 15 of the Act - Revenue Review Petition is dismissed

 

2015-VIL-25-MSTT

M/s MUKUND LTD Vs THE STATE OF MAHARASHTRA

Maharashtra Value Added Tax Act, 2002 - Section 31 - Recovery of amount of tax not deducted at source – Work contract – Failure to deduct of tax at source by assessee from payments made to contractor – HELD - appellant was legally bound to make the payment of TDS into the government treasury by due dates and to file returns which he has failed to do. Therefore,  the assessing authority has rightly and lawfully recovered from the appellant the amount of tax not deducted by the appellant from the payments made to his contractors - The Act neither provides for any separate assessment for payment of TDS nor provides separate notice for such assessment. Therefore, the submission of the appellant that he is not served with any separate notice and separate order for assessing amount of TDS not paid by him is not passed, has no support of law - Contractor can claim such amount as credit of tax payable by him and if he has paid excess amount of tax, more than his liability, he may claim refund. This facility is provided to contractor and not to the employer - Order of lower authority in respect of demanding amount not deducted at source in composite assessment order is upheld - Grant interest on refund under Section 52 – Adjustment of Refund - once the refund is adjusted against the return dues of subsequent period i.e. 2007-2008 on the basis of Trade Circular then there remains nothing excess for allowing interest to the appellant – Assessee appeal dismissed

 

2015-VIL-494-P&H

M/s PRAKASH PIPES INDUSTRIES LIMITED Vs STATE OF HARYANA

Haryana General Sales Tax Act, 1973 – Section 40(2) – Writ petition challenging revisional power exercised by officer of same and equal rank – Delegation of power - HELD - Revision by officer of the same rank was not permissible - writ petition is allowed and the impugned notices issued by the department are set aside

 

2015-VIL-492-HP-CE

M/s SABOO TOR (P) LTD Vs COMMISSIONER CENTRAL EXCISE

CENVAT Credit Rules, 2004 - Rule 5 - Refund – Whether the Tribunal is right in denying the refund in cash even if there is no bar under Section 11 B of the CE Act or Rule 5 of the CCR, 2002 to refund the amount in cash if a person is unable to utilize the credit – HELD - Benefit of input/input service used in the final products cleared for export can be put to the credit of the manufacturer/provider of output service, firstly towards duty of excise; secondly towards service tax and only if, for any reason, such adjustment is not possible, refund is allowed. The third option is an exception to the rule. Only and only if the first two options cannot be exercised, the third option can be resorted to - It is not a case where the appellant has totally closed down his business of manufacture or export. Hence, the CENVAT credit cannot be refunded in cash – Assessee appeal dismissed

 

2015-VIL-491-GUJ-CE

PANOLI INTERMEDIATE (INDIA) PVT LTD Vs UNION OF INDIA

Central Excise - Cenvat credit - input credit - H.R. Plates, Angles, Channels and bars used for repair and maintenance of storage tanks - condonation of the delay – Plea for exceptional circumstances so as to warrant invocation of the jurisdiction under Article 226 of the Constitution – HELD –  this is not a case where the impugned order suffers from the infirmity of having been passed in breach of the principles of natural justice nor has the adjudicating authority acted in excess of its jurisdiction nor is the order without jurisdiction. It is also not the case of the petitioner that the adjudicating authority has acted in flagrant disregard of law or rules of procedure. Under the circumstances, the present case does not fall within any of the exceptional circumstances envisaged by the Full Bench in the order so as to warrant interference in exercise of powers under Article 226 of the Constitution - present petition under Article 226 of the Constitution of India directly challenging the order-in-original passed by the adjudicating authority is not maintainable – Assessee petition dismissed

 

2015-VIL-626-CESTAT-MUM-CE

SHRIDHAR METAL Vs COMMISSIONER OF CENTRAL EXCISE & SERVICE TAX, AURANGABAD

Central Excise – Demand – Job Work - AEL has engaged the appellants to convert waste materials into aluminium ingots. The said aluminium ingots are returned by the appellant’s to AEL - activities happen within the premises of AEL – Demand of duty on the ingots manufactured by appellant on the grounds that the appellant’s are manufacturers in their own right and should have obtained separate registration – HELD - the appellants have to be treated as independent manufacturers doing jobwork for AEL. Since the clearance of aluminium waste is treated as clearance for jobwork the same treatment is to be given to the material manufactured and returned by appellants – Demand set aside and assessee appeal allowed

 

2015-VIL-624-CESTAT-MUM-ST

M/s JAIN ENTERPRISES Vs CCCE&ST, CHANDRAPUR

Service Tax - supply of tangible goods - site formation and clearances, excavation and earth moving and demolition service – Failure to take registration – Dispute period 2007-08 and 2008-09 - appeal for waiver of penalties - bonafide belief – HELD - Thee work order was for number of tippers and charges for supply of number of tippers. The charges also fixed for each tipper. From these details anybody can have belief that services falls under head of ‘supply of tangible goods’. Therefore the appellant’s submission that they entertained bonafide belief regarding the classification of the services, found reasonable. Moreover the appellant, though, the issue on merit also contentious, without contesting the demand they discharged entire service tax liability alongwith interest. They only sought waiver of penalties in this appeal - entertainment of bonafide belief by the assessee is proper and they have made out a case for waiver of penalties by invoking Section 80 - penalties imposed under Section 76, 77 and 78 is waived – Assessee appeal is allowed

 

2015-VIL-493-GUJ-ST

FEDERATION OF SURAT TEXTILE TRADERS’ ASSOCIATION Vs UNION OF INDIA

Service Tax - Club and Association Service - Section 65(105)(zzze) of Finance Act, 1994 – liability of the members of the petitioner-Federation to pay service tax u/s 65(105)(zzze) of Finance Act, 1994 – HELD – In the case of Sports Club of Gujarat Ltd. vs Union of India Court has agreed with the view taken by the Jharkhand High Court in Ranchi Club Ltd. v. Chief Commissioner of CCE&ST, Ranchi and has held sections 65(25a), 65(105)(zzze) and section 66 of the Finance Act, 1994 to be ultra vires and beyond the legislative competence of Parliament - While it is the case of revenue that against the above decisions, appeals have been preferred before the Supreme Court, nothing has been pointed out to show that appeals are admitted or that any interim relief has been granted therein. Under the circumstances, the controversy involved in the present case, to the extent the respondents seek to invoke the provisions of section 65(105) (zzze) of the Finance Act, stands concluded by the above decisions of this court wherein the said provision has been declared ultra vires and unconstitutional and hence, to that extent the impugned show cause notice is without authority of law and, therefore, cannot be sustained - the petition partly succeeds and is accordingly allowed

 

2015-VIL-625-CESTAT-MUM-ST

COMMISSIONER OF CENTRAL EXCISE, NASHIK Vs M/s ASHOKA BUILDCON LTD

Service Tax – Composition scheme under Works Contract Service – Delay in taking registration – Service Tax demand at normal rate by disallowing the benefit of composition scheme – HELD – In this case there is no violation of the Works Contract (Composition Scheme for Payment of Service Tax) Rules, 2007. Rule 3 of the Rules require that the option to pay tax under composition scheme should be exercised before payment of Service Tax. It is seen that the registration under Works Contract Service was taken on 29.06.2007 and the Service Tax was paid on 5th/6th July, 2007. In view of this fact as well as the fact that under Rule 4 of Service Tax Rules the registration may be applied for within 30 days of commencement of business, the show-cause notice has no basis. The adjudicating authority proceeded to pass the Order on a completely fresh ground and therefore the order is liable to be set aside on this ground alone - in the absence of any evidence to show that the new contract was merely an eye wash is not supported by any documentary evidence. No proof is forthcoming from the records that the earlier contract was cancelled and fresh contract signed on 06.06.2007 merely to avail the benefit of a composition scheme which came into effect on 01.06.2007 - demand is not sustainable and revenue appeal is dismissed

 

SBC: Guest Article

Swachh Bharat Cess - Cleaning India Or Cleaning Pockets!!

 

mahaCir18T

Maharashtra: Revision in Rate of Interest

 

rajNoti102

Rajasthan Tax on Entry of Motor Vehicles into Local Areas Act, 1988 - Exemption to earth moving and mining machinery brought into local area

 

cestatCir04

CESTAT: Jurisdiction and date of hearing at Regional bench, Chandigarh

 

24^th of Nov

 

2015-VIL-497-KER

M/s UNITED BREWERIES LIMITED Vs STATE OF KERALA

Kerala Value Added Tax Act, 2003 – Classification of ‘spent grain’, generated in a brewery in the manufacture of 'beer' – Whether falling under exempted goods in the First Schedule or residuary entry as claimed by revenue – HELD - in the contextual content of a taxing statute in a land like India; particularly in the State of Kerala; with the judicial prudence that we are expected to have, we are unable to visualise that 'spent grain' would be reckoned as an edible substitute for human beings - there is absolutely no material for the Revenue to show that ‘spent grain’ is an article that could be subjected to taxation, with reference to any entry in Schedule III, where such articles of goods are specifically mentioned. Therefore, ‘spent grain’, which is a residue of the process of production of ‘beer’, is not chargeable with tax under the Act as it is exempted in terms of the provisions of section 6(4) of the Act. This is the irresistible conclusion on the basis of the statutory materials which govern the question in hand. This is the inexcusable conclusion and result of the plain interpretation of the relevant statutory provisions, as well - ‘Spent grain’ does not fall either under clause (a) or (c) of section 6(1) of the Act – impugned order set aside and assessee petition allowed

 

2015-VIL-498-KER

EARTHLINE SERVICES PRIVATE LIMITED Vs STATE OF KERALA

Kerala Value Added Tax Act, 2003 – Section 25 - Assessment – Limitation - proceedings under Section 25(1) of the Act without extension of period of limitation for assessment by the competent authority – HELD - even if the period of limitation was extended through a lawful order by the Deputy Commissioner, it would still be open to the assessee to challenge the assessment order issued following Section 25(1) of the Act through the statutory hierarchy of appeals and revisions, in accordance with the provisions of the Act - it is appropriate that the assessee-petitioner files statutory appeal before the competent authority against the impugned assessment order and that appeal shall be entertained without insisting on any pre-condition as to deposit - enforcement of any recovery on the basis of the impugned assessment order will stand stayed. It is clarified that the plea of limitation raised by the assessee; also on the contention that no extension of period of limitation was granted by the competent authority under Section 25B of the KVAT Act; are preserved for being considered by the appellate authority - judgment of the learned single Judge is vacated writ is petition allowed

 

2015-VIL-496-GUJ

SHREE SOMANATH AGENCY Vs STATE OF GUJARAT

Gujarat Value Added Tax Act - Section 68 - Inspection of goods in transit – Detention of goods at a place where there was no check-post or barrier as contemplated under section 68(1) of the Act – Setting up of mobile check-post – Request for issuance of transit pass on the basis of the manual application for transit pass in Form 404 - HELD – the check-post or barrier as envisaged under sub-section (4) of section 68 of the Act must be notified by the State Government in exercise of powers under sub-section (1) of section 68 of the VAT Act. It is, therefore, manifest that the powers under sub-section (1) of section 68 of the VAT Act clearly cannot be exercised by the Additional Commissioner Enforcement, Gujarat by virtue of a letter, as has been submitted on behalf of the respondents - even if such letter had granted such permission, the same would be without jurisdiction - Under the circumstances, the respondent had no jurisdiction to take any action in exercise of powers under section 68(4) or (5) of the Act. The impugned seizure memo and show cause notice are, therefore, without any authority in law and therefore, the same cannot be sustained - Even otherwise, also on merits, the petitioner has made out a good case - The impugned seizure memo and the show cause notice are hereby quashed and set aside - the petition succeeds and is, accordingly, allowed

 

2015-VIL-125-SC-CE

COMMISSIONER OF CENTRAL EXCISE, DELHI-III Vs M/s HERO HONDA MOTORS LIMITED
Central Excise – Valuation – Advance deposit at the time of booking of the motorcycle from customers - additional consideration – HELD - The Tribunal, after re-examining the entire material that was produced before it by the assessee, noted that the overall effect of the deposit on the financial position of the company or its profitability had no direct relevance to the dispute. It found that for excise valuation, the relevant consideration was as to whether the deposits had the effect of lowering the sale prices of the motorcycles or whether the sale prices were normal sale prices unaffected by the deposits - each and every aspect of the issue is examined, on the basis of which finding is arrived at that the price of the motorcycle manufactured by it were market driven and it did not follow a cost of production plus reasonable profit pricing policy - These are finding of facts which are arrived on the analysis of the evidence produced and do not call for any interference – Revenue appeal dismissed

 

2015-VIL-499-MAD-CE

M/s HLG TRADING Vs UNION OF INDIA

Central Excise - Exemption from levy of additional duty (CVD) in the case where the manufactured goods are exempted from duty of excise - Petition seeking declaration that the words "and not the buyer of such goods" incorporated in the original Notification No. 30/2004 dated 9.7.2004, through the amending Notification No.34/2015 dated 17.07.2015 is null and void in the light of Section 3(1) of the Customs Tariff Act, 1975 and Section 5A of the Central Excise Act, 1944 – Validity of Notification No.34/2015-CE and No.37/2015-CE - HELD - The amendments are not ultra vires Section 3 as the importers are not placed in a more disadvantageous position than that of the domestic manufacturers. By prescribing certain conditions for availing the benefit of exemption, the impugned amendments treat even the domestic manufacturers differently. Placing the importers on par with those domestic manufacturers who do not get the benefit of the exemption notification, does not strike at the root of Section 3. Therefore, the notifications do not offend Section 3 - Petitioners cannot assail the impugned notifications on the strength of Article 14 of the Constitution. If the domestic manufacturers themselves are classified into two categories depending upon the nature of the conditions imposed, the classification is reasonable and it has a nexus with the object sought to be achieved by the notification - the notifications do not seek to differentiate between the importers and domestic manufacturers. They actually seek to discriminate one set of domestic manufacturers from another set of domestic manufacturers. A decision as to the category into which an importer will fall cannot therefore be taken to be discriminatory offending Article 14 of the Constitution - In respect of the exemption notifications that are absolute and unconditional, all domestic manufacturers will be entitled to the benefit of the exemption notification. Therefore, the importers will also be entitled. But, insofar as exemption notifications that are conditional in nature, the respondents will have to see whether all domestic manufacturers will automatically get exemption or some of them may not get exemption due to non fulfillment of the conditions prescribed in the notification. If some of them are not entitled, due to non fulfillment of the conditions, the importers, for whom it is impossible of complying with those conditions, are also not entitled to the benefit. It is this position that is sought to be clarified by the impugned amendment notifications. Hence, there are no merits in the petition - writ petition dismissed

 

2015-VIL-628-CESTAT-CHE-ST

POLARIS SOFTWARE LAB LTD Vs COMMISSIONER OF CENTRAL EXCISE, CHENNAI-III

Service Tax - demand of service tax under the Maintenance or repair Service for the maintenance of computer software services – HELD – Issue is already settled by the Hon'ble High Court of Madras in the case of M/s.Kasturi & Sons Ltd. Vs UOI and also Hon'ble Supreme Court's decision in the case of UOI Vs Martin Lottery Agencies Ltd - The ratio of these decisions is applicable to the facts of the present case as the period involved in the present appeal is July 2004 to March 2006 which is prior to the amendment brought under Section 65 of Finance Act - Therefore, the amendment cannot have retrospective effect prior to 1.6.2007 - service tax demand in so far as maintenance of computer software service is liable to be set aside - service tax demand is upheld under Man Power Recruitment or Agency Supply Service after allowing cum tax benefit – Penalty set aside – Appeal partly allowed

 

2015-VIL-627-CESTAT-CHE-ST

M/s NEEDLE INDUSTRIES (INDIA) PVT LTD Vs COMMISSIONER OF CENTRAL EXCISE, SALEM

Service Tax - Revenue restricting refund to 2% of FOB although Notification No.33/2008, expanded the percentage to 10% by substitution of the words ‘10%’ in place of 2% in the previous notification – HELD - principal legislation and subordinate legislation operate within their scope. Subordinate legislations are commonly amended by substitution of certain words or figures. By substitution, subordinate legislation do not cause anomaly - if the subordinate legislation had intended that the benefit of 10% shall be allowed only from the date of substitution through Notification dated 07.12.2008, they would have expressly stated that the notification shall have prospective effect. But that is not done. Therefore, there cannot be presumption of prospective effect since substitution has a beneficial grant – The expanded scope is to boost the export scheme - Assessee appeal allowed

 

delNoti1062

Delhi: Extension in date for submission of DP-1

 

harNoti27

Haryana: Amendment in HVAT Schedule 'E'

 

25^th of Nov

 

2015-VIL-126-SC

COMMERCIAL TAXES OFFICER Vs A INFRASTRUCTURE LTD

Rajasthan Value Added Tax Act - Section 2(13) - Exempted Goods - Section 18 - Input Tax Credit - manufacturing Asbestos Cement Pressure Pipe and Asbestos Cement Sheets - disallowance ITC on purchase of raw material – exempted units and exempted sales - HELD – Exemptions with reference to taxable events or taxable persons would not exempt the goods as such, for a subsequent transaction or when the goods are sold or purchased by a non-specified person, the subsequent transaction or the taxable person would be liable to pay tax. It is, in this context, it has been highlighted by the respondent-assessee and, in our opinion, absolutely correctly that Section 4 of the Act provides for levy of tax in a situation where the goods, which were not exempted but could otherwise not be subjected to tax on account of exemption granted to a person or to a transaction. The goods remain taxable goods through exemption stands granted to a particular individual or a specified transaction - The transaction of sale by the manufacturer/dealer covered by the exemption notifications issued under Section 8(3) of the Act would be protected or an exempted transaction, but the goods not being exempted goods would be taxable and could be taxed on the happening of a taxable or charging event. It is simply because the goods are not exempt from tax or exempted goods, but are taxable. As a logical corollary it follows that the Value Added Tax would have to be paid on the taxable goods in a subsequent transaction by the purchasing dealer – High Court judgment upheld and Input tax credit allowed – Revenue appeal dismissed

 

2015-VIL-127-SC-CE

COMMISSIONER OF CENTRAL EXCISE Vs M/s NESTLE INDIA LIMITED

Central Excise – Valuation – assessee is 100% EOU engaged in the manufacture of instant tea – Captive consumption – Revenue contention that tea being captively consumed and not sold should be valued at 115% of the cost of production or manufacture of such goods – HELD - The object of the notification dated 1.3.1997 is that so far as the product in question is concerned, so long as it is manufactured by a 100% EOU out of wholly indigenous raw materials and so long as it is allowed to be sold in India, the duty payable should only be the duty of excise that is payable on like goods manufactured or produced and sold in India by undertakings which are not 100% EOUs - There is no doubt whatsoever that the duty of excise leviable under Section 3 would be on the basis of the value of like goods produced or manufactured outside India as determinable in accordance with the provisions of the Customs Act, 1962 and the Customs Tariff Act, 1975. However, the notification states that duty calculated on the said basis would only be payable to the extent of like goods manufactured in India by persons other than 100% EOUs. This being the case, it is clear that in the absence of actual sales in the wholesale market, when goods are captively consumed and not sold, Rule 8 of the Central Excise Rules would have to be followed to determine what would be the amount equal to the duty of excise leviable on like goods. This being so, it is clear that learned counsel for the assessee is right in contention that the basis of the show cause notice is itself flawed - It is clear that the notification dated 1.3.1997 has been framed to levy only what is levied by way of excise duty on similar goods manufactured in India, on goods produced and sold by 100% EOUs in the domestic tariff area if they are produced from indigenous raw materials. If the revenue were right, logically they ought to have contended that the notification does not apply, in which event the test laid down under Section 3(1) proviso (ii) would then apply. This not being the case, the Tribunal’s judgment is correct and requires no interference – Revenue appeal is, accordingly, dismissed

 

2015-VIL-500-GUJ-ST

ASK ME ENTERPRISE Vs UNION OF INDIA

Service Tax - Denial of benefit of VCES on the ground that the amount paid towards interest and penalty cannot be adjusted towards liability of tax dues under the Scheme – HELD – when the entire amount as contemplated under the Scheme stood paid before the due date and the petitioner satisfied all other requirements under the Scheme, the respondents are not justified in denying the benefit of the Scheme to the petitioner only on the ground that the amount had initially been paid towards the interest and penalty. The impugned communication/order which seeks to deny the benefit of the Scheme to the petitioner under such hyper technical plea, therefore, cannot be sustained - the petition succeeds and is, accordingly, allowed

 

ceNoti44

Central Excise: Amendment to Notification No. 12/2012-CE dated 17.3.2012 so as to provide exemption from excise duty on all raw material and parts for use in manufacture of certain specified ships/vessels subject to actual user condition and also removing the requirement of manufacturing of ships/vessels in a custom bonded warehouse under the provisions of Section 65 of the Customs Act, 1962 for availing duty benefits

 

ceNoti45

Central Excise: Amendment in Notification No. 22/2003-CE dated 31-03-2003 so as to enable EOUs to become eligible for duty exemption on raw materials/parts consumed in manufacture of certain specified ships/vessels and cleared to DTA, even if such ships/vessels are exempt from basic customs duty and central excise/CV duty

 

apCir42

Andhra Pradesh: Conducting VAT audit – Issuance of certain instructions

 

26^th of Nov

 

2015-VIL-128-SC-CE

M/s SHREE BHAGWATI STEEL ROLLING MILLS Vs COMMISSIONER OF CENTRAL EXCISE

Central Excise Act - Demand for interest and penalty under Rules 96ZO, 96ZP and 96ZQ of the Central Excise Rules, 1994, which were framed in order to effectuate the provisions contained in Section 3A of the Central Excise Act, 1994 - payment of interest for delayed payment of central excise duty under Section 3A of the CEA, 1944 - Articles 14 and 19(1)(g) of the Constitution – HELD - When Section 6 speaks of the repeal of any enactment, it refers not merely to the enactment as a whole but also to any provision contained in any Act. Thus, it is clear that if a part of a statute is deleted, Section 6 would nonetheless apply - the expression “omission” is nothing but a particular form of words evincing an intention to abrogate an enactment or portion thereof - Section 3A which provides for a separate scheme for availing facilities under a compound levy scheme does not itself provide for the levying of interest, Rules 96 ZO, 96 ZP and 96 ZQ cannot do so and therefore on this ground the appellant has to succeed – Penalty under Rules 96 ZO, 96ZP and 96ZQ – The Gujarat High Court in Krishna Processors v. Union of India states correct position of law – A penalty can only be levied by authority of statutory law, and Section 37 of the Act, does not expressly authorize the Government to levy penalty higher than Rs.5,000/-. This further shows that imposition of a mandatory penalty equal to the amount of duty not being by statute would itself make rules 96ZO, 96 ZP and 96 ZQ without authority of law - We, therefore, uphold the contention of the assessees in all these cases and strike down rules 96ZO, 96 ZP and 96 ZQ insofar as they impose a mandatory penalty equivalent to the amount of duty on the ground that these provisions are violative of Article 14, 19(1)(g) and are ultra vires the Central Excise Act - interest and penalty provisions under the Rules 96ZO, ZP, and ZQ of the Central Excise Rules, 1994 are invalid – Assessee appeal allowed

 

26^th of Nov

 

2015-VIL-501-DEL

M/s CLASSIC ENGINEERING CO. Vs THE COMMISSIONER OF SALES TAX

Delhi Sales Tax Act – whether the majority of the Tribunal is right in holding that the Assessees were not entitled to the benefit in Form ST-35 for inter-state sales made outside Delhi resulting in the enhancement of turnovers - non-availability of the amended forms – HELD - with the Forms not having been printed and in case of the some of the Appellants the unamended Forms being continued to be issued, the Assessees could not be held to have made any false declaration. The observation of the majority judgment that “non-printing of Forms due to administrative reasons was a mere technicality which cannot make the statutory rule redundant” overlooks the detailed procedure under the DST Rules itself for the printing and issuance of Forms by the assessing authority - As rightly pointed out by the Assessees in the present case, on the strength of the registration certificate that was still unamended, it was open to the Assessees to make the purchases by using the authorisation under Form ST-37A - The Court also accepts the plea of the Appellants that this was not a case of making a false declaration. The Appellants were issued Form ST-35 and ST-35/1 and declarations were given in both forms, which at the time of making of these declarations, could not be held to be false declarations - the Tribunal was in error in holding that the Assessees were not entitled to the benefit of the unamended Form ST-35 for the sales made by way of inter-state sales

Validity of the reassessment proceedings - A mistake in the original assessment will not by itself constitute a justification for reopening of the assessment particularly where all the material facts were already known to the assessing authority. Secondly, the statutory requirement of recording the formation of an opinion about turnover escaping assessment by the tax by the assessing authority is mandatory. Thirdly, the question whether there was ground for reopening the assessment is not a matter for inference reference. There is a mandatory requirement that there must be a written note on the file by the assessing authority recording satisfaction that there existed grounds for reopening the assessment within the meaning of Section 24 of the DST Act. This again cannot be a mechanical reproduction of the provision. If there is no such recording of satisfaction by the assessing authority, the inevitable result is invalidation of the entire reassessment proceedings - the conditions for reopening of the assessment under Section 24 of the DST Act were not satisfied in the present cases - Assessees appeals are allowed and the majority opinion of the Tribunal is set aside

 

2015-VIL-629-CESTAT-MUM-ST

M/s PLANTECH CONSULTANTS PVT LTD Vs COMMISSIONER OF CENTRAL EXCISE, PUNE-I

Service Tax - Adjustment of excess paid service tax - amount which was paid in excess, is neither the service tax nor an amount which was payable by the appellant, therefore in any case the said amount cannot be permitted to be retained by the government. The only option is either to refund that amount or allow adjustment - adjustment is very appropriate and favourable to Revenue as compared to the refund. For this reason also the adjustment cannot be held as illegal - Consulting Engineer Services – Contravention of Section 67(3) of the Finance Act, 1994 and Rule 5(1) and 5(2) of the Service Tax (Determination of Value) Rules, 2006  Travelling expenses, Hostel accommodation and Telephone charges etc. incurred for visit to the site of their customers for collection of inputs and providing on-site services recovered by issue of separate bills over and above the taxable amount charged for the services rendered - whether addable in gross value – HELD - expenses, which is reimbursed in connection with the provision of Consultancy Engineering Services should not be included in the gross value of taxable services - Even as per the Valuation Rules, it is the gross value of the taxable services which shall be chargeable to the service tax. Gross value of taxable could not be interpreted in a manner by which other expenses which is over and above the distinct services charges can included in the gross value - reimbursement shall not be taxable and demand on such reimbursement is not sustainable – Appeal allowed

 

2015-VIL-630-CESTAT-MUM-ST

JAI SOMNATH TRANSPORT Vs COMMISSIONER OF SERVICE TAX, MUMBAI-II

Service Tax - The parties are engaged in providing buses/vehicles on hire on contractual basis - Department contention that the services provided fall under Section 65 (115) as 'Tour Operator Service' and chargeable to service tax. The periods covered are both prior to 10.9.2004 as well as post 10.9.2004 – HELD - Revenue is confusing the words "Tourist permit' and "Tourist vehicle' and reading the word 'permit' to mean the same as Tourist permit - even if the Motor Vehicles Act and the Rules framed thereunder contemplate the tourist permit, it is not necessary that every tourist vehicle must have a "tourist permit". Again, it is to be seen that we would be bound by the language of Section 65(50) to (52) alone in interpreting those provisions. Merely because the Motor Vehicles Act provides for "tourist permit", it would not mean that Section 65(52) of the Finance Act also contemplates only a "tourist permit". We cannot do violence to the language of the provisions by holding that a "tourist vehicle" contemplated under the Finance Act must be a vehicle having only "tourist permit" - Post 10-09-2004 – Assessee were not engaged in the business of planning, scheduling, organizing or arranging package tour of their own as provided under the new definition of 'tour operator' service but were adhering to the conditions laid down in the agreements entered into with various customers. Thus it cannot be said that they were covered under the first part of the amended definition of 'tour operator' also" - the activity does not get covered under the 'Tour Operator' Service post 10-09-2004 – Decided in favour of assesssee

 

Guest Article

Provisions of Sales in transit - Section 6(2) of the CST Act

 

gujPN261115

Gujarat: Manual Acknowledgement for Physical challan of VAT/CST above Rs 10 lacs

 

harPN251115

Haryana: Online issuance of Permit and Pass for Bottled Spirits with effect from 01.12.2015

 

27^th of Nov

 

2015-VIL-502-ORI

STATE OF ODISHA Vs M/s AURO PLASTICS

Orissa Sales Tax Act - whether the commodity Linear Low Density Polyethylene (LLDPE) bags are taxable @ 4% under Entry No.129 or taxable to 8% of sales vide Entry No.136 under the Act - packing material or plastic goods – HELD - Even if the LLDPE is not included in any of the entries but the category or container prepared out of such materials is the crucial question to decide the issue in question – High density polyethylene (HDPE) bag is in the Entry No.129 whereas HDPE woven fabrics and HDPE woven sacks are purportedly under Entry No.136. On analogy, it is considered that Polyethylene is family in both entry Nos.129 and 136 of Sales Tax List ‘C’ under Chapter-III of the Act. Under Polyethylene family density is being considered as genus with High or Linear Low as subdivision under such genus. But bag or fabric or sacks are considered as species being different from each other items. So, Linear Low Density Polyethylene (LLDPE) bag is absolutely different from HDPE fabrics or sacks being under species ‘bag’, resultantly under Entry No.129 and assessable at the rate of 4% - LLDPE is under entry No.129 but not under Entry No.136 of the taxable list ‘C’ under the Act - The conclusion of the learned Tribunal that the material should be decided by the Assessing Authority after obtaining expert opinion is untenable – decided in favour of assessee

 

2015-VIL-504-RAJ

CTO, ANTI EVASION Vs M/s INDIAN OIL CORPORATION LTD

Rajasthan Value Added Tax Act – Levy of tax on ‘license-fee’ received by assessee from the dealers for pumps and tanks – HELD – in the case of Assistant Commissioner v. M/s IBP Ltd this court has already taken into consideration the identical issue and has come to the conclusion that VAT is not chargeable in the case of license-fee recovery – Revenue though tried to distinguish the judgment passed in the case of M/s IBP Ltd but were unable to distinguish the finding recorded by this court – Revenue petition dismissed

 

2015-VIL-503-DEL

ANSAL PROPERTIES & INFRSTRUCTURE LTD Vs COMMISSIONER OF TRADE & TAXES, DELHI

Delhi Sales Tax Act - Section 24 (1) - reassessment proceeding - powers of the Assessing Authority – ‘reasons to believe’ for escaped assessment - HELD - there was no recording by the AA in the file, prior to the issuance of notice of reassessment, that there were "reasons to believe" that the whole or part of the turnover has escaped assessment for the assessment period in question. Therefore, the mandatory requirement of Section 24 (1) of the DSTA has not been fulfilled - The order clearly indicates that the Assessing Officer had perused the balance sheet and thereafter framed the assessment. Consequently, AA reviewed his earlier order based on a change of opinion that the said sum of Rs.400 lakhs ought to have been brought to tax. This course of action was legally impermissible and was beyond the scope of the powers of the AA under Section 24 (1) of the DSTA. If indeed the assessment order of the AA was prejudicial to the interests of the revenue then it was open to the Commissioner to seek to invoke the revisional powers under Section 46 of the DSTA. That course was, however, not opted in the present case - proceedings initiated under Section 24 (1) of the DSTA by the AA was without jurisdiction and unsustainable in law – Assessee appeal allowed

 

2015-VIL-633-CESTAT-AHM-CE

M/s SUNFLAG FILAMENTS INDUSTRIES Vs COMMISSIONER, CENTRAL EXCISE & SERVICE TAX, VAPI

Central Excise – Denial of benefit of Notification No.30/2004-CE – Assessee had excess credit in CENVAT account on 01.08.2005 - Contention of the Revenue that once the sub-rule (3) of Rule 11 of the CENVAT Credit Rules 2004 was introduced, the Appellant should have taken steps to ‘lapse’ the excess CENVAT – assessee utilised a portion of the excess credit for payment of duty on clearance of the capital goods subsequently - We find force in the arguments of the AR that the assessee should have expunged the credit on 01.03.2007. However, do not agree that by virtue of not doing so, it will amount to taking of fresh credit - the Appellant had committed the said contravention in this respect. But the question is whether the said contravention amounts to violation of the notification, whereby the clearances of finished goods duty free under the said notification, can be denied to the Appellant - the Appellants have fulfilled the conditions of the notification and therefore, they are eligible for the benefit of the said notification. Any violation of sub-rule (3) of Rule 11 of the CCR, 2004 should invite necessary action under Rule 14 & 15 of CCR, 2004 only and cannot be extended to the extent of denying the benefit of the substantial notification for that mere reason. We therefore, do not find force in the findings of the Adjudicating authority in this respect in the impugned order. The same cannot be sustained – Assessee appeal allowed

 

2015-VIL-631-CESTAT-CHE-CE

M/s STAR DRUGS AND RESEARCH LABS LTD Vs COMMISSIONER OF CENTRAL EXCISE, CHENNAI-III

Central Excise - Default in payment of duty – withdrawal of permission for monthly payment and notice demanding payment under PLA in respect of clearances where duty was debited in cenvat account on the ground that Rule 8(4) of CER 2002 was contravened – HELD – Both Hon’ble Gujarat High Court and Madras High Court have held that condition contained in Rule 8 (3A) of CER, 2002 for payment of duty without utilization of cenvat credit is contrary to the scheme of availment of cenvat credit under CCR and the said Rule 8 (3A) is arbitrary and violative of Article 14 of the Constitution. Accordingly, the Hon’ble High Court has struck down the Rule 8 (3A) as unconstitutional - following the ratio of the Hon’ble High Court order the demand of duty under Rule 8 (3A) is unsustainable as the said Rule has been struck down by the Hon’ble High Courts and the demand of duty and penalty imposed in the impugned order is liable to be set aside - assessee appeal allowed

 

2015-VIL-634-CESTAT-AHM-ST

M/s KALPATARU POWER TRANSMISSION LIMITED Vs CCE&ST, AHMEDABAD

Service Tax - refund of the service tax paid twice on retention and withheld money - The assessee first payment was made in 2007 when there was no liability paid again in March/ April 2010 when the retention/ withheld amount received – Denial of refund on ground of limitation – HELD – the limitation commences from the date of discovery of error, as prescribed by Section 17 of the Limitation Act, 1963, the period of six months prescribed by Section 11B of Central Excise Act, 1944 is inapplicable in such case – the principle of unjust enrichment will not be applicable in such cases as payment did not relate to tax - appellant is eligible for the refund of the amount deposited as it is double payment and it does not relate to tax - the impugned orders cannot be sustained and are set aside – Assessee appeal allowed

 

2015-VIL-632-CESTAT-AHM-ST

THE AGRICULTURE PRODUCE MARKET COMMITTEE Vs CCE&ST, VADODARA

Service Tax – input service - appellant herein is a committee, who hires out godowns constructed by them to the farmers/traders/dealers who would like to store their agricultural products before sale. It is also seen from the records that in order to attract the business of renting of immovable property to various individuals, the appellant herein incurred various expenditures on the advertising, marketing, management consultancy etc. The list of services which have been availed by the appellant would indicate that the services which are received by the appellant are in relation to the business activity of the appellant i.e. renting of godowns to various persons – input credit admissible – Assessee appeal allowed

 

wbOrder256

West Bengal: Determination of the rate of tax applicable to the Annual Maintenance Contract (AMC) involving development, upgrade and maintenance of pre-existing software

 

wbOrder261

West Bengal: Determination of the rate of tax applicable to the sale of 15T multitasking hydraulic machine Pick-n-Carry

 

cestatCir24115

CESTAT: Regarding hearing at Regional Bench at Hyderabad

 

stCir189

Service Tax: Clarification regarding leviability of service tax in respect of Seed Testing with effect from 01.07.2012

 

delCir31

Delhi: Time limit for restoration of registration application

 

2015-VIL-635-CESTAT-DEL-CU-LB

M/s GAURAV PHARMA LTD Vs CCE & ST, ROHTAK, DELHI

Special Five Member Bench Order - Customs Act, 1962 - provisional release of seized goods - Whether an appeal lies before this Tribunal against the order passed by Commissioner (Customs) under Section 110A of the Act for provisional release of the goods or not – Revenue objection on maintainability of the appeal on the ground that the same was not within the purview of the provisions of Section 129A of Customs Act, 1962 - HELD - the contention that an order or decision by the Adjudicating Authority under Section 110A is administrative or interim in nature is misconceived - provisions of Section 129A (1) (a) clearly authorize an appeal against an order or decision by the Adjudicating Authority issued under Section 110A. There is no legal basis to restrict the scope of such appeal in the absence of any restrictive conditions in the provision - An appeal lies before this Tribunal against an order passed by Commissioner of Customs under Section 110A of the Customs Act, 1962 for provisional release of the goods – Matter transmitted to Division Bench to decide the appeals on merits

 

30^th of Nov

 

2015-VIL-505-BOM

THE ADDL. COMMISSIONER OF SALES TAX Vs M/s SUN SYSTEMS

Maharashtra Value Added Tax Act, 2002 - Classification and rate of tax of ‘Sine Wave Home UPS’ – Inverter – UPS – Schedule Entry C-56 - Information Technology Product – HELD - If the Information Technology products used business and even at home require uninterrupted power supply then any facility or product ensuring uninterrupted power supply with its parts ought to relate to the IT products - Once the uninterrupted power supply and its parts have been specifically made referable to Entry No.56, then, there was no warrant for invoking and applying the residuary entry merely because that guarantees higher revenue. The approach of the Tribunal is precisely on these lines. Once the product in question has been classified in the light of the plain and clear language of the entry, then, no question of law arising for determination and consideration in these appeals – Revenue appeals are dismissed

 

2015-VIL-26-TRB

M/s SHREE GANESH ROLLER FLOUR MILLS Vs THE STATE OF PUNJAB

Punjab VAT Tribunal - Punjab VAT Act - bonafide mistake of the reversal of the ITC - levy the penalty – HELD - the First Appellate Authority did not take pains to ponder over the arguments as raised by the appellant - the appellant had changed the counsel who did not allow the correct ITC to be carried forward and didn’t make correct calculations on coming to know about the mistake, the appellant voluntarily came forward for reversal of the correct ITC and to remove the mistake - if the mistake on the part of the counsel was intentional and on account of concealment of facts, the order passed by the Deputy Excise and Taxation Commissioner being non speaking needs to be relooked – impugned order is set aside - appeal is allowed by remand

 

2015-VIL-131-SC-CE
M/s CASTROL INDIA LTD Vs COMMISSIONER OF CENTRAL EXCISE, CHENNAI
Central Excise – Valuation – Provisional assessment – Differential duty demand - Cash on Delivery and credit sale – Cash discount - deduction of ‘interest on receivables’ from sale price for the purpose of determining the assessable value – HELD - The Tribunal failed to notice that the difference between price charged on credit terms and cash sales was to the extent of 1.75 per cent, which was nothing but cash discount - the invoices for sales on credit terms, interest for the credit period was in built in the credit price – demand quashed - appellant is entitled to consequential relief of refund - assessee appeal allowed

 

2015-VIL-129-SC-CE
COMMISSIONER OF CENTRAL EXCISE, MUMBAI Vs M/s SHAPOORJI PALLONJI & CO. LTD

Central Excise - The Tribunal holding that 'Ready Mix Concrete' (RMC) does not amount to 'manufacture' - This Court in M/s. Larsen & Toubro Ltd vs. Commissioner of Central Excise, Hyderabad, otherwise held that RMC would amount to 'manufacture' and, therefore, liable for payment of excise duty. The Judgment of the Tribunal has to be, therefore, set aside on this ground alone - assessee had taken a specific plea before the Adjudicating Authority that the produce in question is not RMC but only 'Mix Concrete' (MC) - However, the Tribunal did not go into this aspect as it proceeded on the basis that even if it was RMC produced at site, the same shall be entitled to exemption under the requisite Notification. In view thereof, the matter needs to be remanded back to the Tribunal to decide whether the produce in question is RMC manufactured at site or is it MC as contended by the assessee – impugned order set aside – Matter remitted to the Tribunal to look into the matter afresh – revenue appeal allowed

 

2015-VIL-130-SC-CE
UNION OF INDIA Vs RUBBER PRODUCTS LTD
Central Excise - classification of ‘Vacuum Brake Hose Pipe’ – Revenue seeking classification under Tariff Heading 4009.92 whereas the assessee contends same is classifiable under Tariff Heading 4009.99 – HELD - the view taken by the High Court is unsustainable on two grounds - Firstly, the writ petition itself was not maintainable when there was alternate remedy available to the assessee under the provisions of the Act and the assessee should have exhausted those statutory appeals - Even otherwise, on merits, the High Court has allowed the writ petition wrongly. The High Court has glossed over the vital fact that the order of Collector (Appeals) in the first round of litigation was not accepted by the Department but was challenged. This plea did not fail on merit but appeal was dismissed by the Tribunal as time barred. Therefore, at the most, the said order of the Collector (Appeals) attained finality insofar as period covered by the earlier show cause notice is concerned and could not have been binding precedent for future period – the impugned orders passed is set aside - Revenue appeal allowed

 

2015-VIL-637-CESTAT-DEL-ST

M/s HIGHWAY TYRES PVT LTD Vs CCE&ST, CHANDIGARH-I

Service Tax – leviability of service tax on retreading of tyres under ‘management maintenance and repair service’ – HELD - the status of the assessee as manufacturer is not relevant to determine taxability – the existence of offer, acceptance, performance and consideration is sufficient to render even the most simple and rudimentary transaction to be a contract. The activity of retreading is an activity of repair for maintenance of used tyres, considering the ingredients of the transaction, would fall well within the ambit of section 65(64)(i) and is taxable under Finance Act, 1994 - the original authority to re-compute the tax due after taking into account the goods on which VAT liability has been discharged – levy interest upheld and penalty set aside – Decided in favour revenue

 

2015-VIL-636-CESTAT-DEL-ST

M/s UNIPRO MARKETING PVT LTD Vs CCE&ST, NEW DELHI

Service Tax – pre-deposit – rejection of appeal by Commissioner (Appeals) – HELD - The fact that the assessee failed to comply with the pre-deposit ordered is not in dispute - The impugned order also notices that the appellant sought modification of the pre-deposit order but this request was rejected since the lower Authority had no power conferred under the provisions of Finance Act, 1994 to review his own order - The impugned order passed by the ld. Commissioner (Appeals) rejecting the assessee’s appeal is in the circumstances impeccable and warrants no appellate interference – Assessee appeal is rejected

 

Guest Article

Credit Balance of Education Cess & SHE Cess - Never Ending Story!

 

rajCir09 & rajCir14

Rajasthan: Regarding condonation of delay in case of failure to submit the application for exemption from payment of tax payable by the registered dealers engaged in works contract within the prescribed time limit

 

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