SUMMARY FOR THE MONTH OF JANUARY

1^st January to 15^th January

 

1^st of Jan

 

2016-VIL-03-P&H

M/s KAPURTHALA BELTINGS Vs THE STATE OF PUNJAB

Punjab General Sales Tax Act, 1948 - incentive of sales tax exemption - Export Oriented Unit – collection of sales tax from customers in the shape of ‘handling charges’ in violation of the provisions of Sections 10(4) and 30A of the Act – failure to export at least 25% of its products in the markets outside India – cancellation of exemption certificate – HELD - it was rightly held by the Assessing Authority that the appellant had violated the provisions of the rules and accordingly, was not entitled to any exemption under Rule 8(2) of the Rules - export of at least 25% of the production by an 'Export Oriented Unit' at the markets outside India is compulsory. It has been categorically recorded by the assessing authority that in the assessment years 2000-01 and 2001-02, the appellant exported nothing outside India - Both the issues have rightly been concluded against the appellant

 

2016-VIL-03-CESTAT-CHE-CE

CHENNAI PETROLEUM CORPORATION LTD Vs COMMISSIONER OF CENTRAL EXCISE, LTU, CHENNAI

Central Excise – Clearance of Carbon Block Feed Stock (CBFS) during the period from Sept’ 04 to Dec’ 05 – Demand and penalty under proviso to Section 11A (1) along with interest – HELD - the appellants have clearly informed the jurisdictional AC, Central Excise the quantity of stock which was lying in their bonded tanks as on 6.9.2004 - appellants were issued with SCN alleging suppression of facts for the subsequent period after the OIO - Once the department has accepted the RTP price determined by the appellants in the order, there is no justification for invoking the suppression for imposition of penalty - considering the period involved relates to the transitional period when all the oil industry, PSUs switched over to different mechanism of payment of excise duty on the petroleum products from ware house to the Refinery itself and also considering the fact that there was no sale of CBFS as it is captively consumed by IOCL there is no suppression of facts with an intent to evade excise duty - there is no justification for invoking Section 11AC for imposition of equal penalty liable for imposition of penalty under Section 11AC – impugned order set aside the appeal is allowed

 

2016-VIL-02-CESTAT-DEL-CE

M/s SUPREME CYLINDERS LTD Vs C.C.E. JAIPUR-I

Central Excise - Clandestine removal of LPG cylinder – Central Excise proceedings on basis of the payments made to the Income Tax Department - Demand and penalty – HELD - The allegation of clandestine removal of goods has been leveled on the ground that the income tax demand promptly paid by the appellant without contesting the liability - in arriving at such conclusion, the Department has not carried out any independence enquiry to ascertain as to whether the goods were removed clandestinely without payment of duty - clandestine removal of cylinder cannot be upheld - impugned order is set aside and appeal is allowed

 

2016-VIL-01-MAD-ST

ARAFAATH TRAVELS PVT LTD Vs COMMISSIONER OF SERVICE TAX, CHENNAI

Service Tax – Pre-deposit – Levy of tax on overriding commission, on passenger air ticket sales and cargo sales - export of services – Tribunal order directing pre-deposit – Assessee in appeal – HELD - the assessee has a better case on the issue of liability and perhaps carried away by this view, it did not raise the issue regarding the financial hardship. However, the Tribunal is expected to exercise its discretion, vested under the unamended provisions of Section 35F of the Act. In this case, there is a failure to exercise the discretion, as the Tribunal had lost sight of the provision applicable to the case, having regard to the date of filing of the appeal. When the Tribunal had failed to exercise the discretion, this Court is bound to interfere – Tribunal order is liable to be set-aside, as the order had been passed, invoking the amended provisions of Section 35F of the Act, whereas the law applicable to the case of the assessee is proviso to unamended Section 35F of the Act – matter is remitted back to the Tribunal / first respondent to pass appropriate order – In favour of assessee

 

2016-VIL-02-MAD-ST

M/s KRIPA OUTDOOR PUBLICITY Vs THE COMMISSIONER OF CENTRAL EXCISE, CHENNAI-II

Finance Act, 1994 – Penalty under Section 76 for belated payment of the service tax – HELD - appellant had not furnished any material to substantiate its claim that it was under severe financial hardship - no materials were made available, by the appellant, to show that the erstwhile partnership firm had been converted into a sole proprietary concern. Since service tax payable has not been paid, for nearly about 3 years, the appellant had been imposed with the penalty - No acceptable cause or reason had been shown for exercising discretion, for waiving the penalty – No reason to interfere with the impugned order – Appeal dismissed

 

2016-VIL-01-CESTAT-DEL-ST

M/s NATIONAL ENGINEERING INDUSTRIES LIMITED Vs CCE, JAIPUR

Service tax on the commission received from foreign suppliers in respect of the imports into India on orders placed through it – Demand – HELD - In case of the commission received from foreign supplier for procuring orders from the Indian buyers to whom the goods were directly supplied by the foreign supplier, the service rendered clearly satisfies the requirement of the same being the export of service as has been held by CESTAT in the case of Paul Merchants - Even in the other situation where the commission is paid by the Indian buyers to the appellant as per arrangement with the foreign supplier instead of the commission alongwith price being first remitted to the foreign supplier and then the foreign supplier sending the commission to the appellant, in effect, the commission was paid to the appellant on behalf of the foreign supplier only and can be deemed to have been paid in foreign exchange as the buyers would have had to remit the commission part also to the foreign supplier who would have in turn sent it to the appellant. This arrangement thus makes the procedure simpler without any material difference with regard to foreign exchange implication to India – Assessee appeal allowed

 

ceNoti45

Central Excise: CENVAT Credit (Sixth Amendment) Rules, 2015 - Import of Goods by Authorised Courier - Certificate issued by Appraiser of Customs as valid document

 

harNoti01

Haryana: Revision of rate tax on the sale of Bidi

 

mpNoti45

Madhya PRadesh: Extension in date for completion of assessment and reassessment

 

2^nd of Jan

 

mahaNotiCR158

Maharashtra Value Added Tax (Third Amendment) Rules, 2015 - Insertion of new Rule 52B - Set-off in respect of certain goods covered under Schedule D of the MVAT Act

 

chhgOrdi5

Chhattisgarh Value Added Tax (Amendment) Ordinance, 2015 - Amendment of CVAT Schedule-II - Change in rate of tax on Petrol & Diesel

 

upNoti1979

Uttar Pradesh: Amendment in UPVAT Part-A of Schedule-II - Regarding 'Plastic Footwear'

 

odiNoti80

Odisha: Amendment in OVAT Schedule 'B' and Schedule 'C' - VAT rate for Part-III of Schedule B of VAT Act amended to 14.5% & Increase in rate of tax on Foreign Liquor

 

rajNoti7307

Rajasthan: Regarding furnishing of information by e-Commerce entity in Form EL-1, EL-2 and EL-3

 

delNoti1210

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

 

ceNoti01

Central Excise: Increase the Basic Excise Duty rates on Petrol and Diesel (both unbranded and branded)

 

Guest Colunn: E-book on GST [2nd Edition] - By CA Pritam Mahure [Download link | PDF File size 6.52Mb]

 

4^th of Jan

 

2016-VIL-06-MAD

SEVEN HILLS MEDTECH SYSTEMS Vs /THE COMMERCIAL TAX OFFICER

Tamil Nadu Value Added Tax Act - assessment – disallowance of claim of sales return on the basis of report of the VAT audit of the Enforcement Wing - books of accounts – HELD -  Simply, for the reason that documents had not been produced before the Enforcement Wing, the department-respondent cannot deny to accept those documents for perusal - the impugned order is liable to be set aside and accordingly, the same is set aside and the matter is remitted back to the respondent for passing fresh orders - the petitioner is permitted to produce all the documents to the respondent and on such filing, the same shall be considered and orders passed, after affording an opportunity of being heard to the petitioner – In favour of assessee

 

2016-VIL-05-GUJ

KISHAN PROTEINS Vs STATE OF GUJARAT

Gujarat Value Added Tax Act - pre deposit - Whether the Tribunal was right in law in directing payment of pre-deposit of total tax as well as interest amount – appellant has deposited 10% of the tax amount under the order of assessment - HELD - when in the first round, the Tribunal had thought it fit to direct pre-deposit of only Rs. 5,00,000/- for the purpose of hearing of the appeal by the first appellate authority, there was no justification for now directing pre-deposit of the total tax amount together with interest - it is evident that the appellant was not served with the notice of hearing by the first appellate authority and it is on account of this reason that no one could remain present for hearing of the appeals - when 10% of the tax demand has already been deposited by the appellant which is more than the amount that was directed to be paid by way of pre-deposit for the purpose of hearing of the appeals by the first appellate authority in the first round of these proceedings, such amount would suffice for the purpose of hearing of the appeals by the Tribunal - the appeals succeed and are accordingly allowed

 

2016-VIL-06-CESTAT-CHE-CE

HYUNDAI MOTOR INDIA LTD Vs CCE & ST LTU, CHENNAI

Central Excise – Valuation - inclusion of cost of Pre-Delivery Inspection (PDI) and After Sales Service (ASS), overriding commission paid to dealers on sale to canteen store-department in the assessable value – Cost of Display Kits collected from dealer through debit note and recovery of Incentive Trip Cost recovered from dealers - Non-inclusion of profit margin at exclusive showrooms - Valuation of Demo Cars - Cenvat credit on fabricated paint shop structural – HELD - In respect of issues, viz. (i) PDI/ASS charges, (ii) overriding commission on sale of cars to CSD, (iii) Cost of display kits, (iv) Incentive trips recovered from dealers, (v) non-inclusion of profit margin paid at exclusive showrooms and (vi) cenvat credit on structurals used in fabricated paint complex, Revenue’s appeals are rejected - On the issue of valuation on demo cars assessee appeal dismissed

 

2016-VIL-04-GUJ-CE

APAR INDUSTRIES (POLYMER DIVISION) Vs UNION OF INDIA

Central Excise – Export of goods – Reject of Rebate claim on ground of wrong format and limitation – Rule 18 of CER, 2002 - HELD - Neither Rule 18 nor notification of Government of India prescribe any procedure for claiming rebate and provide for any specific format for making such rebate applications. The Department, therefore, should have treated the original applications / declarations of the petitioner as rebate claims. Whatever defect, could have been asked to be cured. When the petitioner re-presented such rebate applications in correct form, backed by necessary documents, the same should have been seen as a continuous attempt on part of the petitioner to seek rebate. Thus seen, it would relate back to the original filing of the rebate applications, though in wrong format. These rebate applications were thus made within period of one year, even applying the limitation envisaged under Section 27 of the Customs Act. Under the circumstances, without going into the question whether such limitation would apply to rebate claims at all or not, the Department is directed to examine the rebate claims of the petitioner on merits – revisional order are set aside. The Department shall process and decide rebate claims in accordance with Rules - In favour of assessee

 

 

2016-VIL-01-ARA

M/s J.P. MORGAN SERVICES INDIA PRIVATE LIMITED

Service tax – Leviablity of service tax on car lease scheme under Section 66B of the Finance Act, 1994 - whether the amount which the applicant charges to its employees for this use of the vehicles is subject to service tax – HELD - the applicant is an employer and the applicant is providing some service to its employees by giving an option to all such employees to avail of a car. In that sense, it is making available a car for the use of the employees during the term of their employment for which it is charging only the car rent which the applicant is paying to the car leasing company from which it has hired the car - What is relevant is, as to whether a service is being provided by the applicant to its employees which service is “in the course of” or “in relation to” his employment - Since, both these conditions are fulfilled, this will not amount to ‘service’ - this task of ‘making available’ a car for personal and official use as well would not invite the service tax – in favour of assessee

 

2016-VIL-05-CESTAT-KOL-ST

M/s FOOD CORPORATION OF INDIA Vs COMMISSIONER OF CENTRAL EXCISE & SERVICE TAX, PATNA

Service Tax – Denial of benefit of Notification No. 32/2004-ST dated 03.12.2004 on the ground that the applicant had failed to produce declarations in consignment note issued by the GTA indicating it had not availed the benefit of either CENVAT Credit or the benefit of exemption Notification No.12/2003-ST dated 20.06.2003 – HELD - general declaration was accepted in lieu of declaration in each consignment note issued by the GTA service provider - matter is remanded to the ld. adjudicating authority for the limited purpose to scrutinize and consider said declarations in extending the benefit of Notification No.32/2004-ST dated 08.12.2004 - the impugned order is set aside and the appeal is allowed by way of remand

 

2016-VIL-04-CESTAT-KOL-ST

M/s STEEL AUTHORITY OF INDIA LTD Vs CCE & ST, RANCHI

Service Tax – Demand on taxable services received under ‘consulting engineering services’ from overseas services providers in relation to modernization / expansion of plant in India - period 01.10.1999 to 15.08.2002 – HELD - The chargeability of Service Tax for taxable services received in India and provided from a person located outside India prior to insertion of section 66A i.e. from 18.04.2006, has been settled by the Hon’ble High Court in the case of National Shipowners Association’s case and upheld by the Hon’ble Supreme Court. The said principle later accepted by the department by issuing Circular dated 26.09.2011 - the impugned order is set aside and the appeal is allowed

 

mahaNotiCR169 & mahaNotiCR169II

Maharashtra: Amendment in MVAT Schedule ‘A’ - Regarding Drugs and medical equipments used in dialysis and List of the such drugs and medical equipments

 

mpNoti02

Madhya Pradesh: Revision in Additional Tax on Petrol & Diesel

 

mpNoti01

Madhya Pradesh: appoints Additional Commissioner, Commercial Tax

 

5^th of jan

 

odiNoti276

Odisha: Amendment in OVAT Schedule C - Hike in rate of tax on Motor Spirit including Petrol and HSD

 

telCir723

Telangana: Regarding notifying the goods to be sensitive for the purpose of transportation of goods from outside the State to within the State with the advance way bills

 

cuNoti01

Customs: Amendment in Notification No. 27/2011-Customs, dated the 1st March, 2011 - Exemptions of Customs duty on goods falling within  the second schedule of Customs Tariff Act, 1975 - Regarding Iron ore pellets

 

cbecInst163

CBEC: Further instructions regarding providing monetary limits for filing appeals by the Department before CESTAT/High Courts and Supreme Court

 

2016-VIL-08-P&H

M/s SANJEEV STONE CRUSHING COMPANY Vs STATE OF HARYANA

Haryana Value Added Tax Act, 2003 - section 8 – Input tax credit – absence of proper invoice – Denial of credit - HELD - it is not within the control of the purchaser to ensure that the tax invoice contains his name and TIN No. as it is issued by the seller. Unless a mandatory duty is cast on the seller to issue tax invoice with such particulars, the purchasers cannot be penalized for no fault of theirs - Assessing Officer not justified in declining the benefit of input tax credit only on the ground that the tax invoices did not contain the name of the buyer and also its TIN number – issue involved in these appeals is covered by the decision of this Court in M/s New Devi Grit Udyog vs. State of Haryana - Assessee appeal allowed

 

2016-VIL-07-MAD

REAL IMAGE MEDIA TECHNOLOGIES PVT LTD Vs THE ASSISTANT COMMISSIONER (CT)

Tamil Nadu Value Added Tax Act - comprehensive equipment maintenance services – Work Contract - two original assessment orders for the same assessment year – HELD - there cannot be two original assessment orders for the same assessment year, the impugned orders are set aside and the matter is remitted back to the respondent for passing orders afresh

 

2016-VIL-07-CESTAT-AHM-CU

M/s SUN PHARMACEUTICALS INDUSTRIES LIMITED Vs COMMISSIONER OF CENTRAL EXCISE & S.T., VADODARA

Customs – 100% EOU - pharmaceutical goods were imported duty free and warehoused as per the warehouse provisions – goods could not be utilised immediately - permission for clearing the goods to Domestic Tariff Area on payment of duty in accordance with the customs provision – demand of interest for the period from the date of import to the date of clearance from the warehouse, in addition to duty – assessee contesting imposition of interest – HELD – The warehousing provisions specify that the goods can be warehoused till expiry of three years as per Section 61 (i) (a) of the Customs Act, 1962. The duty liability on the goods will arise only after expiry of such time limit, or when the goods are cleared from the warehouse before that time limit - In the instant case clearances of the goods have been done within the permitted period of three years and there is no contravention - there is no basis to demand interest from the appellant as there is no delay in payment of the duty. Interest can be levied only if there is delay in payment of duty, which is not the case herein - no reason for imposition of penalty, as the appellant has not violated any of the provisions nor delayed the payment of duty - the impugned orders set aside and assessee appeal allowed

 

2016-VIL-10-CESTAT-CHE-CE

M/s PERIASHOLA TEA FACTORY (P) LTD Vs CCE, SALEM

Central Excise - Manufacturing and Clearance of Tea – Denial of benefit of exemption under Notification No. 4/99-CE dated 26.11.99 on the ground that the factory was not worked for six months - expression ‘manufacture’ – repair and maintenance works as incidental to manufacture - purchase of green leaf from the small growers - HELD – the notification did not contain the expression ‘manufacture’ and it only stipulated that the factory should have worked for atleast six months during the previous year - Maintenance and repair work are directly having relevance for the activities of the factory without which the factory cannot function smoothly - the appellant factory was working throughout the year and complied the conditions of the notification and eligible for the benefit of the notification - It is not the case of the department that the appellants not procured green leaves from small growers - The appellants used not less than two thirds of green leaves which were procured from small growers. The exemption notification should be read and interpreted in right perspective - assessee is eligible for exemption under Notification No. 4/1999 - The appeal is allowed

 

2016-VIL-11-CESTAT-MUM-CE

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

Central Excise - Appellant was a composite mill engaged in the manufacture of yarn and grey fabrics – availment if CENVAT credit of the duty paid on yarn exclusively used for the manufacture of grey fabrics which is exempted from payment of duty - demand under Rule 57CC of Central Excise Rules, 1944 – whether the appellant is required to be directed to pay an amount which is equal to 5% or 10% of the value of the finished goods which were exempted and cleared for export – HELD - appellant has used locally procured yarn as well as in-house manufactured yarn for manufacturing of grey fabrics which are either exported or consumed in their own sister unit. If that be so when the clearances are effected to the sister unit appellant availed the benefits of Notification 05/98-CE and paying concessional rate of duty of 5%, hence it cannot be said that appellant had manufactured only exempted goods out of the duty paid yarn. It is also on record that the appellant had exported the balance grey fabrics - the provisions of Rule 57C will not apply in this case, provisions by sub-rule (3) of Rule 57CC are directly applicable which are governed of sub-rule (5) wherein it is very clearly stated that manufacturer shall pay an amount equivalent to the credit of duty attributable to inputs contained in such final products at the time of their clearance from the factory - for the purpose of export, non-execution of bond or LUT may not be required as long as the goods are cleared for export or exported - impugned order set aside and appeal is allowed

 

2016-VIL-09-CESTAT-CHE-CE

M/s ITC LTD Vs CCE, SALEM

Cenvat Credit of service tax paid in respect of health care service provided to the factory workers and guest house – HELD - Law need not necessarily codify each and every item as input used in or in relation to manufacture. The basic principle being use of input ‘in or in relation to manufacture’, such test is to be applied to consider allowance of CENVAT credit of the service tax paid on the input utilized and having relevance to the output manufactured - service tax paid in respect of health care service provided to the factory workers shall be admissible as CENVAT credit - credit denied on guest house as it has no relevance to output service – Penalty set aside – assessee appeal partly allowed

 

2016-VIL-08-CESTAT-AHM-ST

M/s VEENA INDUSTRIES LIMITED Vs COMMISSIONER OF CENTRAL EXCISE & S.T., VAPI

Service Tax - Appellant is a service provider as well as a manufacturer - whether the appellant as a service provider is eligible to avail the credit of service tax paid on the input services – Manufacture and erection & installation (through sub-contractors) of DG Set - appellant avail credit of the service tax paid by their sub-contracts, treating the same as ‘input service’ – Denial of credit on the ground that appellants being ‘manufacturers’ are eligible for credit of the input services pertaining to ‘up to the place of removal’ of excisable product – HELD - department has denied the CENVAT credit to the appellant on the basis of Rule 2 (l), sub-rule (ii) of CCR, 2004 - the appellant is a service provider and is covered by Rule 2 (l)(i) which states, that ‘input services means any service used by the provider of taxable service for providing output service’ - appellant has provided taxable output service by utilising the input service provided by sub-contractors. Therefore, they are eligible to take cenvat credit of the service tax paid on the input service provided by the sub-contractors - appellant has rightly taken the cenvat credit on the input service provided by the sub-contractors and they have paid the applicable service tax on the output service provided by them - the impugned orders cannot sustain in law and therefore they are set-aside - appeals are allowed

 

gujNoti06

Gujarat: Increase in Rate of Cess on Petrol and Diesel

 

gujNoti46

Gujarat: Increase in Rate of Tax on Petrol and Diesel

 

fmBudgetMeet

Press Release: Finance Minister Pre-Budget meet

 

You Tube Video

GST - Overview, RNR and Open Issues

 

rajNoti110

Rajasthan: Reduction of CST on the sale of textile fabric impregnated, coated, covered or laminated with plastic etc. under CST Act, 1956

 

hpNoti2010

Himachal Pradesh: Amendment in Part-II of SCHEDULE 'A' - Tax rate of Central Armed Police Forces canteens

 

odiOrder236

Odisha: Resolution regarding increase or decrease in rate of tax on Petrol & Diesel

 

assamNotiFTX100

Assam: Regarding tax payable by Central Police Canteen

 

CUSTOMS SECTION

dgftPN52: DGFT: Implementation of the Track and Trace system for export of Pharmaceuticals and drug consignments

dgftPN53: DGFT: Introduction of Para 2.14(A) in the Handbook of Procedure (2015-20) - Modification/Change in Branch Office/Head Office/Registered Office Address in IEC involving a shift in jurisdictional RA

 

FCP0501

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

 

6^th of Jan

 

2016-VIL-10-ALH

VACMET INDIA LTD Vs STATE OF U.P.

U.P. Value Added Tax Act - Fiscal holidays - promissory estoppel in matters of government policy relating to extending of benefits under schemes for setting up of commercial units - benefit of interest free loan as against payment of VAT – discontinuation of scheme and withdrawal of benefits - HELD - The decision to withdraw the benefits being unfair and unreasonable to the disadvantage of the petitioners without there being any public interest having been shown or any plausible reason existing to label the continuance of benefits as unequitable, is a clear mala fide exercise of power, and is an act which cannot be sustained on any legal principles - the State Government came up with New Industrial Policy to extend similar benefits clearly indicates that the rescinding of the earlier policy is not bonafide and is bereft of such considerations that ought to have been undertaken and which stands now established with similar benefits being extended under the new policy - unclarity of any objective reason for discontinuing the scheme does not make out any ground to deny capital subsidy, infrastructure subsidy and the transportation subsidy when it is established that the petitioners had clearly acted upon the representation made by the Government on its promise to extend such facilities - it is only the interest free loan part which can be correlated to the introduction of the VAT Act. Consequently, no plausible or reasonable explanation as to how the subsidies deserved to be withdrawn and on what adverse public interest - the introduction of VAT Act per se as a substitute for the Trade Tax Act does not alter the situation unless the State Government comes up with any objective consideration so as to point out a supervening public interest – No justification in GOs dated 18.11.2011 and 11.2.2015 to deny any benefits to the petitioners. The consequential recovery of the taxes without there being a valid bonafide or reasonable decision cannot be enforced - the GOs are struck down and respondents are restrained from recovering taxes under the impugned notices - The State Government shall take a fresh decision within three months only in relation to the benefit of interest free loan as against payment of VAT for the period in question - The impugned recovery of taxes shall remain on hold till a fresh decision is taken. The disbursement of the three subsidies in relation to Capital Subsidy, Infrastructure Subsidy and Transportation Subsidy and other subsidies shall be released forthwith – assessee writ petitions are allowed

 

2016-VIL-09-ALH

M/s SHREE CEMENT LIMITED Vs STATE OF U.P.

U.P. Tax on Entry of Goods Into Local Areas Act, 2007 – Interim and Conditional stay by Supreme Court - petitioner directed to pay tax at the prevailing rates for the future period – Demand of interest under category of 'future period' – HELD - when the writ petition was filed by the petitioner before the High Court the tax that being demanded was for the assessment year 2008-09. The words, "future period" in the order of the Supreme Court would denote any tax liability that would arise or accrue after the date of the order passed by the Supreme Court, i.e., after 18th of January, 2012 - The words "future period" would include such demand for the period subsequent to 18th of January, 2012 - the petitioner has already deposited 50% of the accrued tax liability alongwith interest for the assessment year 2008-09 and therefore, was not required to pay any further amount as per the interim order of the Supreme Court - the impugned orders cannot be sustained and are hereby quashed - writ petitions are allowed

 

2016-VIL-11-ALH-CE

COMMISSIONER CUSTOMS & CENTRAL EXCISE, MEERUT-II Vs M/s HONDA SIEL POWER PRODUCTS LTD
Central Excise – Section 2(f) – Manufacture - manufacture of portable gen set I.C. Engine and parts thereof and Power Driven pump - Whether the mere placing of a bought out Pump with own manufactured I.C. Engine in a single carton would amount to manufacture of Power Driven Pumps - benefit of Notification No.6/2002 dated 1.3.2002 – HELD - Mere addition in the value of a product would not amount to manufacture. To bring the process within the definition of manufacture, it must be shown that due to the process original identity of the product undergoes transformation and it becomes a distinct and new product - the finding recorded by the Tribunal in the impugned order that by putting together a Pump and Engine and a platform the assessee had produced a new item viz. "P.D. Pump" is wholly baseless and also without consideration to the findings of fact based on relevant material and evidences recorded by the Adjudicating Authority. Merely putting together one bought out item with own manufactured item in a carton does not involve any process amounting to manufacture under Section 2(f) of the Act – Impugned order set aside and matter remitted back to the Tribunal for de novo consideration of the facts of the case – Revenue appeal succeeds and is allowed

 

2016-VIL-12-CESTAT-MUM-CE

COMMISSIONER OF CENTRAL EXCISE, MUMBAI-I Vs M/S MEGA RUBBER TECHNOLOGIES PVT LTD

Central Excise – Return of rejected goods - CENVAT Credit of the duty paid on such goods and reprocess / manufacture - applicability of Rule 16 of Central Excise Rules – HELD - the assessee had tried to reprocess the finished goods received and in few cases no duty was paid. The finished goods received back resulted in scrap. The assessee has discharged the duty liability on scrap on the value of the invoices raised by them - this is a correct position of the law and if any inputs are issued to the job-worker for manufacturing and manufacturing activity undertaken on such inputs, the resultant product cleared as scrap and no input as such. Applying the same analogy, the first appellate authority was correct in setting aside the order of the adjudicating authority - Demand of duty on the value of moulds used in manufacturing the final products - If it is a case that the amortization of the cost of moulds is nothing but to collect the Central Excise duty on value of such moulds, then it has already been done so by the assessee - when the Central Excise duty is paid on moulds at one time or recovered by amortising the cost of goods produces, it is the same i.e. duty on value of mould is to be recovered - The impugned order is upheld and revenue appeal is rejected

 

2016-VIL-13-CESTAT-MUM-CE

THE PAPER PRODUCTS LTD Vs CCE, MUMBAI-III

Central Excise – Valuation – Demand on account of the transportation and insurance charges not shown separately in the invoice in term of Rule 5 of the Central Excise Valuation Rules, 2000 – debit note – HELD – from the purchase order it is found that the freight charges are to the buyer’s account. Merely because these are not mentioned separately is no reason to conclude that sale is not complete at the factory gate - the payment for purchase in this case has been split into invoice value (for goods) and debit notes for charging transportation costs. Merely because the transport has been arranged by appellant on buyers request and recovered from buyer through debit notes cannot be a ground for denying substantial benefit under the law laid down in Section 4 - the impugned order is set aside and appeal is allowed

 

2016-VIL-15-CESTAT-KOL-ST

M/s VODAFONE ESSAR SPACETEL LTD Vs CCEC&ST, BBSR-I

Service Tax – Admissibility of Cenvat Credit on capital goods used in the state of Jammu & Kashmir - capital goods installed in the state of Jammu & Kashmir also used for providing taxable roaming service – Centralized registration - extended period and imposition of penalty – HELD - Obtaining centralized registration of Bhubaneswar does not mean that service provider (branch office) in Jammu & Kashmir State starts providing services from Bhubaneswar - branch office in Jammu & Kashmir was not required to be included by the appellant in the centralized registration from where no taxable service is provided by virtue of Section 64(1) of the Finance Act, 1994 – no force in the argument of the appellant that the capital goods / towers installed in J&K are also used for providing taxable roaming services, because such facility/service has to be deemed to have been provided at Bhubaneswar - all the branch offices of the appellant remain separate service providers even if a centralized registration for discharging service tax liability is obtained by the appellant - when branch office (service provider) in J&K was not required to discharge service tax then all the capital goods installed in the State of J&K have to be considered ineligible for taking credit - Cenvat Credit availed on improper documents - Minor procedural irregularities, if any, cannot be made the basis of denying Cenvat Credit if utilization of taxable services have been established to be used in the output services provided - Cenvat Credit has been correctly availed by the appellant and appeal to that extent is required to be allowed - Invocation of extended period and imposition of penalty – HELD - assessee of the stature of the present appellant, having the best legal advise at their command, cannot be considered to be ignorant of law - Appellant never approached the department at any stage that any ambiguity or confusion exists in taking of credit with respect to capital goods / services installed availed in the State of J&K - extended period is applicable with penalty - not a fit case for allowing the benefit of Section 80 of the Finance Act, 1994 – Mostly in favour of Revenue

 

2016-VIL-14-CESTAT-DEL-ST

PUNJAB TECHNICAL UNIVERSITY Vs C.C.E.&S.T., LUDHIANA

Service Tax - distance education programme through Regional Centres (RCs) and Learning Centres (LCs) – Demand under Franchisee Service – Valuation - HELD - Owing to the fact that LCs represented the appellant with regard to providing education, MOU laid down strict requirements of infrastructure, processes, qualifications of staff, etc - Though the MOU states that it is not a franchise arrangement and is a model of public-private partnership for deciding classification of the service rendered thereunder, we need to see the nature, terms and conditions thereof; it is immaterial as to what nomenclature is assigned to it. Thus, notwithstanding that the MOU states that it is not a franchise agreement, the analysis leaves no doubt that it satisfies all ingredients of franchise as defined in Section 65 (47) of the Finance Act, 1944 in-as-much-as LCs were granted representational rights to provide service and to undertake various activities identified with the appellant. The contention of the appellant that franchise has to involve trade mark, service mark, trade name or logo or any other such symbol is untenable as the definition of franchise given in Section 65(47) ibid quoted earlier clearly states that these may not be involved - out of the total fee collected by the appellant through LCs, a part was given back to LCs - the part of the collection which was given back by the appellant to LCs cannot form part of the assessable value for the purpose of taxability - the appellant provided franchise service -  The extended period is not invocable and Penalty under Section 78 ibid cannot be imposed – Mostly in favour of revenue

 

apCir92

Andhra Pradesh: Regarding cancellation of e-Way Bills

 

cuNoti01NT

Customs: Customs Brokers Licensing (Amendment) Regulations, 2016

 

7^th of Jan

 

2016-VIL-01-TRB

M/s JYOTI CNC AUTOMATION LTD Vs THE STATE OF GUJARAT

Gujarat VAT Tribunal - Central Sales Tax Act, 1956 – Rejection of C-form based on information available on Tinxsys website – use of tinxsys website for proceedings under the Act – SEZ sale – Interest on refund - HELD - tinxsys website is not reliable for authenticity - the appellate authority has erred in rejecting the declaration form -  appellate authority should have, before rejecting the form, properly investigated the veracity of the form instead of relying only on the data available on tinxsys website - The appeal is remanded to the first appellate authority who shall allow deduction in accordance with law under section 8A(1)(a) on turnover of sales made by the appellant to SEZ Units without form I and on turnover of inter-State sales for which C forms are not produced by the appellant. The first appellate authority will also carry out proper investigation with respect to C form - The first appellate authority will also grant interest under Section 9(2) of the CST, 1956 r/w Section 38(2) of the Gujarat Value Added Tax Act, 2003 on the amount of refund arising out of this appeal – Appeal allowed

 

2016-VIL-14-DEL

CONVERTECH EQUIPMENTS PVT LTD Vs COMMISSIONER OF TRADE AND TAXES, DELHI

Delhi Value Added Tax Act – Section 6(3) - Sale exempt from tax – Whether sale price received by the Appellant on sale of used motor vehicles could not be included in the turnover as it was exempt from tax under Section 6(3) of the Act – application of judgment in Anand Decor case – HELD - where the assessees were not dealers or traders in motor vehicles but manufacturers or traders in other commodities, the sale of motor cars by such dealers would be exempted under Section 6(3) of the Act - Court does not have to speculate what the outcome of the Revenue’s SLP in the Supreme Court might be, as far as this Court is concerned, its judgment in Anand Decor would cover this case as well - Impugned order is set aside and assessee appeal allowed

 

CENTRAL EXCISE SECTION

 

2016-VIL-12-KAR-CE

COMMISSIONER OF CENTRAL EXCISE, BANGALORE-III Vs M/s SUNDARA INDUSTRIES (I)(P) LTD

Central Excise - Whether the assessee can be granted modvat credit without fulfilling the conditions of production of a certificate for payment amount of CVD - Rule 57R of the erstwhile CER, 1944 – HELD - The non-compliance of the said Rule would not disentitle the respondent from availing the Modvat credit having deposited the countervailing duty as prescribed under the Rules - taking into account the legal position as per Explanation 9 to Section 43 of the Income Tax Act, 1961, introduced retrospectively with effect from 01.03.1994, wherein it is made clear that the cost of the capital goods shall be reduced by the amount of duty to excise in respect of which a claim of credit has been made and allowed under the Rules, KSFC cannot claim depreciation on the portion of the capital goods representing countervailing duty taken as Modvat credit – Revenue appeal stands dismissed

 

2016-VIL-16-CESTAT-CHE-CE

MADRAS CEMENTS LTD Vs COMMISSIONER OF CENTRAL EXCISE, TIRUCHIRAPALLI

Central Excise - Cenvat Credit - admissibility of capital goods credit on the parts used by the appellant in the capital goods of plant and machinery which in turn are used in the manufacture of excisable goods, cement and clinker and inputs used in manufacture of final product – HELD - By virtue of Apex court’s order in the appellant’s own case the issue has attained finality. In respect of input 'Aquachem', this Tribunal in the case of India Cements Vs CCE Trichy has already allowed input credit - appellants are eligible for credit on items used in the plant and machinery for manufacture of cement and clinkers under rule 57Q (1) of the CER 1994 – the impugned order is set aside and the appeal is allowed

 

2016-VIL-19-CESTAT-KOL-CE

M/s ITC LTD Vs CCE, PATNA

Central Excise - paper and paper board – cutting of big size labels manufactured in assessee other unit – Assessee claimed goods as ‘printed labels’, classifiable under Chapter Sub-Heading 4821.00 of CETA, 1985; whereas, the department proposed its classification under 4823.90 – Revenue contention the processes resulted into ‘manufacture’ as per Sec.2(f) of CEA, 1944 - HELD - mere cutting of larger sheets or lengths of a product into convenient or required sizes cannot and does not amount to ‘manufacture’ - the goods continue to conform to the description of ‘paper board labels of all kinds’ within the meaning of Sub-Heading 4821.00 of the CETA - since no manufacturing activity takes place, there can be no question of charging any duty – Assessee appeals are allowed

 

SERVICE TAX SECTION

 

2016-VIL-20-CESTAT-MUM-ST

CCE, MUMBAI Vs RELIANCE INDUSTRIES LTD

Service Tax – Admissibility of CENVAT credit on the service tax paid in relation to insurance policies – The insurance policies for plant and machinery, inputs, other goods and factory building and building & residential township - cost of such insurance included in the valuation of the final product manufactured – HELD - The adjudicating authority has exercised his option of accepting the Cost Accountant’s certificates as furnished by the assessee and satisfied himself as to the fact that the value of the insurance cost has been included in the pricing of the final product - when the cost of any service is included to determine the valuation of the final product, CENVAT credit cannot be denied of such tax paid on the services - no reason to deviate from such a view already taken - appeals filed by Revenue appeals are rejected

 

2016-VIL-17-CESTAT-MUM-ST

RELIANCE INDUSTRIES LTD Vs CCE&ST (LTU), MUMBAI

Service Tax - CENVAT credit in respect of services like construction service, repairs and maintenance service, security service, manpower recruitment and supply service, works contract service etc – HELD - when the cost of the services are included in the final cost of the products, CENVAT credit should not be denied on the service tax paid on the services utilized - the CENVAT credit has to be allowed in respect of the service tax which has been paid and which forms a part of the value of the finished goods on which excise duty is charged - The impugned order is set aside and the appeal is allowed

 

CUSTOMS SECTION

 

2016-VIL-13-KAR-CU

M/s SAIKALA POWER PRIVATE LIMITED Vs ADDITIONAL DIRECTOR GENERAL OF FOREIGN TRADE, NEW DELHI

Customs – FTP – Denial of Export Obligation Discharge Certificate - goods supplied to a power project under procedure of International Competitive Bidding (ICB) - Non-fulfilment of criteria of ‘goods supplied under the contract should be manufactured in India’ – claim of benefit of deemed export – Petitioner contention that after direct import of procurements, it has undertaken the activity of assembly of various parts, fabrication, re-conditioning, erection, installation etc. and as such its claim would fall within the word ‘manufacture’ as specifically defined in paragraph 9.36 of Chapter 9 of FTP – HELD - Capital goods such as Boilers, Turbines, Generators (BTGs) are supplied to project authorities, then deemed export benefits would be admissible if only such BTGs are manufactured in India - if the petitioner had used the goods procured by carrying out the manufacturing activity for the purposes of commissioning and installing the power project, it would have been entitled to claim the benefit. Such situation had not arisen inasmuch as, the petitioner having imported the goods had shifted the goods “as such” and thereby not meeting the criteria prescribed under clause 8.2 of FTP namely, “goods are manufactured in India” - Since export policy having been brought for import substitution and if the project authorities were to import the same, then said project authority cannot be heard to contend that imports substitution has taken place. From facts on hand, it is explicitly clear that the goods imported under advance authorisation licence have been supplied as such to the project and they have not been manufactured in India and as such, these goods as ‘capital goods’ would not be entitled for exemption under advance authorisation – assessee petition dismissed

 

 

2016-VIL-18-CESTAT-CHE-CU

M/s TOP VICTORY INVESTMENTS (P) LTD & M/s TPV TECHNOLOGY INDIA PVT LTD Vs CC, TRICHY

Customs - appellants are importers of LCD/LED Monitors and Television sets - denial of MRP based assessment under Section 3(2) (b) of CA read with Section 4A of CEA and demanded differential duty on the ground that the goods were sold to industrial consumers and therefore, assessment under MRP is not applicable – HELD - the appellants have been clearing the goods when the MRP assessment came into existence from 2008 onwards. Therefore, the department suddenly choose to change the assessment from MRP based to transaction value from 10.05.2012 only to the goods sales made to the brand owners is not justified and particularly when the revenue itself accepted the assessment based on MRP under Notification No. 49/2008 from 24.12.2008, on the same transaction to the actual users - the monitors with brand name meant for sale to brand owners are eligible for assessment under Section 3(2)(b) of Customs Act r/w Section 4A of CEA and eligible for abatement - Accordingly, the impugned orders demanding differential duty is liable to be set aside – Assessee appeals are allowed

 

cuNoti02

Customs: Exemption to Goods required in connection with petroleum operations undertaken under specified contracts under the Marginal Field Policy (MFP)

 

FCP0601

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

 

cuNoti02NT

Customs: Rate of exchange of conversion of the foreign currency with effect from 8th January, 2016

 

cuCir01

Customs: 24x7 Customs clearance at Krishnapatnam Sea port in Nellore, Andhra Pradesh

 

8^th of Jan

 

2016-VIL-17-MAD

M/s AMWAY INDIA ENTERPRISES PVT LTD Vs STATE OF TAMIL NADU

Tamil Nadu Value Added Tax Act – Writ petition seeking a declaration that Sections 3(1), 3(2) and 24 of the Act as unconstitutional and ultra vires Articles 14, 19(1)(g) and 265 of The Constitution of India and Rule 8(3) of the TNVAT Rules as ultra vires Section 80 of the TNVAT Act, 2006 – Measure of tax - Turnover – Assessment – Principals of Apex Court judgement in Govind Saran Ganga Saran case – HELD - the contents of sub-section (1) of section 3 have to be understood in the context of the definition of the expressions "turnover" and "total turnover". If Sub-Section (1) is read along with the definitions of the expression "sale", "total turnover" and "turnover" stipulated in Sub-Sections (33), (40) and (41) of Section 2, it will be clear that there is no uncertainty or vagueness in the measure of tax - Sub-Section (2) of Section 3 takes care of at least three components namely (i) the taxable event (ii) the measure of tax and (iii) the person, on whom, the levy would fall. Therefore, it is impossible to think that the four components mentioned the decision in Govind Saran Ganga Saran do not stand satisfied - the decision in Govind Saran Ganga Saran does not state that all the four components of a valid levy should be found in one particular Sub-Section of one Section and that it would become invalid otherwise

Challenge to Section 24(1) of the Act - best of judgment assessment - power to Assessing Officer to determine whether the price shown by a dealer in his accounts is abnormally low compared to the prevailing market price of such goods – HELD – very same contention in relation to Section 12A of the TNGST Act, 1959 was rejected by a Division Bench of this Court in Jayalakshmi Traders Vs. Government of Tamil Nadu - the ratio of the Two Member Bench in Jayalakshmi Traders applies in all force to the present challenge to Section 24(1).

Challenge of the petitioner is to Rule 8(3) of the TNVAT Rules, 2007 - procedure for assessment - best of judgment assessment – HELD - Clause (d) of Sub-Rule (3) of Rule 8 makes it clear that if the difference in prices, exclusive of tax limit, is more than 15%, the Assessing Officer shall examine the reasons for variation. We do not think that anything more could have been done by the Rule Making Authority, to indicate as to how a best of judgment assessment could be carried out under Section 24(1) - in Jayalakshmi Traders, this Court was concerned with a similar rule in Rule 18C. Hence, the challenges to the statutory prescriptions are devoid of merits – Assessee writ petitions dismissed

 

2016-VIL-18-KAR

SAVITA OIL TECHNOLOGIES PVT LTD Vs DEPUTY COMMISSIONER OF COMMERCIAL TAXES (AUDIT)

Karnataka Tax on Entry of Goods Act 1979 - Levy of tax on Coolants classifying it as petroleum products – SCN proposing rectify the assessment orders by levying tax on coolants – HELD - The ingredients of ‘coolant’ manufactured by petitioner, namely, demineralised water and Ethylene Glycol is not a byproduct of petroleum. If that is so, the clarifications that ‘coolants’ and ‘radiator coolant’ are lubricating oil and petroleum product liable for entry tax at 5%, is incorrect - Respondent, without adverting to relevant facts over constituents / ingredients of ‘coolant’ manufactured by the petitioner, jumped to the conclusion that it is identical to the one manufactured other assessee hence liable to tax under the KTEG Act - the impugned notices are arbitrary and illegal - petitions are allowed in part.. Liberty is reserved to the respondent-clarifying authority to have the ‘coolant’ manufactured by the petitioner, tested, and examined in a manner known to law over the genuineness of the claim of the petitioner relating to its contents / ingredients, and if necessary to issue clarification of the ‘coolant’ manufactured by the petitioner, contains petroleum by product, after extending a reasonable opportunity of hearing to the petitioner, to pass orders in accordance with law

 

CENTRAL EXCISE SECTION

 

2016-VIL-22-CESTAT-MUM-CE

TRISTAR EQUIPMENT PVT LTD Vs COMMISSIONER OF CENTRAL EXCISE, NASHIK

Central Excise - Clearance of pre-fabricated construction and stationary pre-cooling equipments for cold storage without payment of duty on C.T.2 certificate produced by consumers – revenue seeks reversal of Cenvat credit of 8% or 10% of the value of the goods as such these goods are exempted – HELD - C.T. 2 certificate cannot be equated with the exemption - clearances made under bond is not same thing as clearances of goods wholly exempt or goods chargeable to nil rate of duty hence provisions of Rule 57C of Central Excise Rules, 1944 are not applicable - assessee need not to reverse 8% / 10% of the value of the goods cleared by them – Appeal allowed

 

 

2016-VIL-24-CESTAT-ALH-CE

COMMISSIONER OF CENTRAL EXCISE, LUCKNOW Vs SRIVATSA INTERNATIONAL LTD

Central Excise - EOU to DTA sale – claim of exemption from payment of CVD under Notification No. 30/04 dated 9.7.2004 issued under Section 5A(1) of the CEA – whether the proviso to Section 5A(1) on EOU clearances in DTA - HELD - The proviso to section 5A(1) is only to state that even if there is exemption from Central Excise duty under section 3(1) on any goods produced in India, it will not imply that the exemption from Central Excise duty will also be automatically available on goods produced and cleared by a 100% EOU. It is quite obvious from this proviso that, by virtue of exemption under Section 5A(1), goods produced by a 100% EOU do not get automatically exempted - The duty payable on goods produced and cleared by a 100% EOU is to be seen in terms of provisions of Section 3(1) and while calculating this duty, the CVD component is to be calculated on the basis of excise duty payable on such products produced in India. And if such duty payable is a concessional rate of duty in terms of a Notification, the same notification will apply for calculating CVD on goods produced and cleared by a 100% EOU – Although the Commissioner (Appeals) has held that the proviso to Section 5A is not applicable, he has erred in holding that the benefit of Notification No. 30/2004 will not be available. Notification No. 30/2004 is conditional, to be entitled to the concession under this notification, the assessee should not have taken credit of duty on the inputs or capital goods - in the case of goods imported by a 100% EOU, the condition cannot be applied nor can it be enforced. The Revenue's appeal itself says that this condition is for indigenous manufacturer. This condition is obviously not applicable to goods imported. Therefore, no reason to deny the benefit of this notification - Revenue appeals dismissed

 

SERVICE TAX SECTION

 

2016-VIL-15-MAD-ST

THE ADDITIONAL COMMISSIONER, CENTRAL EXCISE, MADURAI Vs M/s STRATEGIC ENGINEERING PVT LTD

Service tax – installation and commissioning of GRP Pipes - Demand under the category of "Erection, Commissioning or Installation Services" - contract for fabrication, erection, alignment and hydro-testing of GRP piping at the LNG Terminal – HELD - Before the amendment to Section 65(39a) under Finance Act, 2005, installation of plumbing, drain laying or other installations for transport of fluids was not included within the definition of "erection, commissioning or installation" - The pipes that the assessee had to lay were not plant, machinery or equipment - the contract for the purpose of laying pipelines did not come within the definition of the expression "commissioning or installation" as it prevailed under Section 65(28) as on 01.07.2003 – revenue writ petition dismissed

 

2016-VIL-23-CESTAT-CHE-ST

SUNDARAM ASSET MANAGEMENT COMPANY LTD Vs COMMISSIONER OF CENTRAL EXCISE & ST, LTU, CHENNAI

Service Tax - Banking and Other Financial Services - Denial of credit availed and utilized on advertisement services and commission paid on brokerage - advertisement expenses is incurred on account of mutual fund which is reimbursable expenditure as pure agent expenditure and it has no relation with output service rendered – HELD - advertisements for promoting the mutual fund can be issued or incurred by the mutual fund or its sponsor or Asset Management Company. There is no bar on the Asset Management Company in paying expenses for advertisement - the expenses on the advertisement cost was duly included in the value of output taxable service and discharged service tax on the gross value and the expenditure on the advertisement charges are debited in the P&L Account of the company and have not been recovered as reimbursements - Revenue's contention that it is not an input service is not justified - the advertisement charges incurred by the appellant is an input service and the appellants are eligible for the input service credit and demand confirmed is liable to be set aside - availment of credit on brokerage fee – HELD – CBEC clarification after the introduction of negative list wherein the Board has categorically clarified that service tax paid on the brokerage commission by Mutual Fund and Asset Management Companies is available as credit for paying service tax on their output services - appellants are eligible for taking credit on the service tax paid by them on brokerage commission and the demand confirmed by the adjudicating authority is liable to be set aside – Assessee appeal allowed

 

2016-VIL-21-CESTAT-DEL-ST

M/s KUMAGAI SKANSKA HCC ITOCHOU GROUP Vs CST, DELHI

Service Tax – services provided under composite turnkey contract in favour of the Delhi Metro Rail Corporation (DMRC) – Demand under ECIs – HELD - The decision in CCE&C vs. Larsen & Toubro Limited ruled that works contracts were not taxable under CICS, COCS or ECIS prior to 01.06.2007. For the period subsequent to 01.06.2007 works contracts are taxable under Section 65(105)(zzzza). However, the preambular portion of the definition of works contracts excludes works contract provided in respect of railways from the scope of definition of the taxable service - the impugned order is is quashed and assessee appeal allowed

 

CUSTOMS SECTION

 

2016-VIL-16-MAD-CU

THE COMMISSIONER OF CUSTOMS (PORT EXPORTS) Vs M/s BRAKES INDIA LTD

Customs - assessee representation for "re-assessment of their Bill of Entries" to enable them to pay CVD by cash and to seek equivalent credit in DEPB Scrip - assessee seeking to incorporate in the Bill of Entries, a different method of payment of CVD than what was indicated in the original Bill of Entry – use of expression "re-assessment of Bill of Entries" instead of "amendment of Bill of Entries" – rejection of claim by invoking Section 17(4) – HELD - the request was only for amendment of the Bill of the Entries but the assessee used a wrong expression "re-assessment of Bill of Entries" and did not quote the provision of law. It is not necessary for an assessee, while making a request to quote a provision of law or to use only the proper language as stated in the statute - the statute doesn’t prescribes a particular form for making an application for amendment of the Bill of Entry - what the assessee substantially wants, is what matters more than the form or the language in which the prayer is couched - without quoting Section 149 and without using the appropriate language relevant for the action, namely "Amendment of Bill of Entries", the assessee had used the wrong expression "re-assessment". This cannot be taken advantage of by the Department to deprive the assessee from making use of DEPB Scrip for claiming credit and also disabling them to make payment in cash. The assessee cannot be made to lose on both sides, by quoting a simple provision of law and raising a theoretical proposition - revenue appeal dismissed

 

ceInst41

CBEC: Instructions regarding proper certificate under Notification No. 108/95-Central Excise dated 28.08.1995

 

rajNoti111

Rajasthan Value Added Tax (Amendment) Rules, 2016 - Substitution of Rule 12, 13, 25, 77, Form-01 & Form VAT-26 and Amendment of Rule 14, 16, 22A, 33

 

mahaCir20T

Maharashtra: Restructuring of Maharashtra Sales Tax Department

 

gujNoti37

Gujarat Value Added Tax (Amendment) Rules, 2016 - Amendment in Rule 19 & 20 and Substitution of Form 203 and Form 204 - Additional Forms for Textile Incentives

 

delNoti1259

Delhi: Notification regarding Delhi Sugam-2 (DS-2)

 

delNoti1271

Delhi: Specifies conditions for downloading the Central Statutory forms online

 

11^th of Jan

 

2016-VIL-20-JHR

BIHAR RAFFIA INDUSTRIES LIMITED Vs THE STATE OF JHARKHAND

Jharkhand Value Added Tax Act - withdrawing the benefit of exemption granted by the Industrial Policy, 1995 for the exemption of the payment of sales tax on raw materials purchased and on sale of finished goods - benefit of deferment of tax - outstanding of tax deferment amount – withdrawal of on-line facility for road permit (e-suvidha) - Rule 42(4) r/w 95(3)(ii) of the JVAT Act – Interpretation of Supreme Court order – HELD – The Hon'ble Supreme Court has not given any stay to petitioner to the effect in the appeals preferred by the State that the assessee should not make payment of deferred amount of tax. Such type of interpretation made by the petitioner of the interim order passed by the Hon'ble Supreme Court was at the peril & risk of the petitioner - by misreading of the order passed by Hon'ble Supreme Court or, may be, deliberately the installments of the deferred amount of sales tax was not paid by the petitioner - In view of the provisions of Rule 42(4) and especially 2nd proviso thereto, if the petitioner is a defaulter in making payment of tax, “e-Suvidha” provided by the State can be withdrawn. State has all power, jurisdiction and authority to withdraw this facility. No error has been committed by the State in passing an order in pursuance of the aforesaid provisions of the Act and the Rules. Moreover, particularly when the defaulted amount of sales tax which is “undisputed” and is not paid by the petitioner, State cannot wait for indefinite time for collection of the duties or the tax - the State should have taken action at a much earlier point of time. Unnecessarily there is a stoic silence on the part of the State after 30th April, 2013. The indifferent approach of the State or the lethargic approach of the State in the levy of the tax is deprecated. Those who are Incharge of imposition and levy of tax should take action against the erring officers for not to recover the tax which are due & payable from the petitioner since long. Amount of tax is a public money. The recovery of the tax or the levy of the tax cannot be left at the charity of one or two officers of the State. It is true that the State has to take work from honest hands and dishonest hands; enthusiastic hands and lethargic hands. Sometimes honest hand may be lethargic and dishonest hand may be enthusiastic. The fact remains in this case that the last installment was payable on 30th April, 2013. The legally payable tax was required to be recovered much earlier in point of time. Too much leniency has been shown by the few officers of the State to this petitioner - there is no substance in this writ petition, hence, dismissed

 

2016-VIL-19-P&H

STATE OF HARYANA Vs M/s LUMINOUS POWER TECHNOLOGIES PVT LTD

Haryana Value Added Tax Act, 2003 – Limitation – Revenue application for condonation of inordinate delay of 1298 days – “sufficient cause” for delay - HELD - The narration of cause for claiming condonation of delay in filing the present appeal does not satisfy the test of “sufficient cause” so as to entitle the State for condonation of inordinate delay of 1298 days in filing the appeal - facts shows that the State was not serious in pursuing the litigation. The State should be more vigilant and serious in pursuing the litigation. It is very surprising and astonishing that it has taken such a long time for the decision making process for filing the appeal. The State must ensure in future that the matter is expedited and the responsibility is fixed on the officer/official dealing with the filing of the appeals in case any delay occurs on their part - no merit in the application for condonation of delay and the same is dismissed

 

CENTRAL EXCISE SECTION

 

2016-VIL-29-CESTAT-CHE-CE

M/s TUBE PRODUCTS OF INDIA Vs CCE, CHENNAI-IV

Central Excise - interpretation of CER Rule 16 - manufacture of steel strips, sheets and tubes - receiving of customer rejected goods – reversal of cenvat credit availed for the rejected goods - sale of rejected goods in auction and payment of duty as per the transaction value – Demand of differential duty and education cess between the cenvat credit taken and duty paid on the clearances – Interest and penalty – HELD – a case in which the manufacturer of final product receives the goods back from the customer under sub-rule (1) and removes the same as such without undertaking any process thereon is also covered by the second part of sub-rule (2). The expression ‘any other case’ is apparently wide enough to cover such a case - the second leg of sub-rule (2) of Rule 16 i.e., ‘in any other case’ is applicable and assessee had correctly discharged excise duty on the returned goods cleared as such. The appellants are not liable to pay the amount equal to cenvat availed on the returned goods - the demand, interest and penalty is set aside – Assessee appeal allowed

 

2016-VIL-28-CESTAT-MUM-CE

THE GREAT OASIS ENTERPRISES PVT LTD Vs COMMISSIONER OF CENTRAL EXCISE, MUMBAI-IV

Central Excise – manufacture of biscuits – duty on value of goods, which are waste of packages and container – HELD – demand being the duty on value of goods, which are waste of packages and container cleared as scrap - during the process of manufacture some wastage of packaging material occurs which is not useful and rejected. This being only charge against the appellant and there being no ‘manufacture’ the demand is not sustainable - impugned order is set aside and the appeal is allowed

 

2016-VIL-27-CESTAT-MUM-CE

TATA STEEL LTD Vs COMMISSIONER OF CENTRAL EXCISE, MUMBAI

Central Excise - valuation - differential duty - Whether the Central Excise duty paid on inputs needs to be included in the costing of the final product for arriving at the assessable value or otherwise – HELD - The Apex Court in in the case of Daiichi Karkaria case has held that the Central Excise duty paid on the inputs need not be included for arriving at the costing of final product as the availment of Cenvat credit neutralizes the impact of the duty on costing of the finished products - learned Counsel fairly submits that there could be instances where there may be short payment of duty even after applying the principle as laid down by the Apex Court in the case of Daiichi Karkaria.  To that extent, the differential duty payable shall be paid by the appellants along with interest and the differential duty will be calculated on the basis of the law settled by the Apex Court - As the issue is a question of interpretation, no penalty is imposable – assessee appeal allowed

 

SERVICE TAX SECTION

 

2016-VIL-26-CESTAT-MUM-ST

FLUENT INDIA PVT LTD Vs COMMISSIONER OF CENTRAL EXCISE, PUNE -I

Service Tax – demand under intellectual property right - wholly owned subsidiary - royalty paid for distribution, marketing and support of computer software – HELD - appellant are a wholly owned subsidiary, It can hardly be expected that a company will transfer its intellectual property right to its wholly owned subsidiary - The Agreement is essentially for distribution, marketing and support of computer programme known as FI software. No title or ownership of the software product or any portion there of is transferred to the appellant - the definition of ‘intellectual property right’ under Section 65 (55a) covers trademarks, designs, patents or any other similar intangible property under any law. The word, ‘namely’ in the definition qualifies to restricts the scope to specific intellectual property rights that are covered by specific statutes/laws - apart from three specific property rights the last category is any property under any law. It does not require much intelligence to appreciate that the intellectual property referred to in the section has to be an intellectual property under a law - Revenue cannot simply allege that the activity of the appellant is an intellectual property service without specifying the precise intellectual property right. This is the basic flaw in the entire proceedings and shows complete lack of appreciation of the statutory provisions. Therefore, the order deserves to be set aside on this ground alone - demand of service tax is set aside

 

2016-VIL-25-CESTAT-AHM-ST

M/s LEAR AUTOMOTIVE INDIA PVT LIMITED Vs COMMISSIONER OF CENTRAL EXCISE & S.T., VADODARA

Service Tax – Cenvat Credit - Courier service – Input Service - Amendment w.e.f 01.4.2008 - admissibility of Courier Services used in relation to movement of finished goods – HELD - With effect from 01.4.2008, the definition of Input Service was amended and instead of the words, ‘from the place of removal’, ‘up to the place of removal’ were introduced - It has resulted in treating those input service which are used by the manufacturer till the place of removal only as input services – In the facts of the case the assessee utilised the Courier Service for the purpose of movement of inputs and finished goods, in addition to sending/ receiving documents related to the business. Therefore, after 01.04.2008, though the appellant would be eligible for CENVAT credit on the Courier Service used for sending / receiving documents related to the business, or for movement of inputs and finished goods up to the place of removal, they would not be eligible for credit on Courier Services used in relation to movement of finished goods, after the place of removal – Matter remanded for re-determination of credit

 

CUSTOMSSECTION

 

 

2016-VIL-30-CESTAT-CHE-CU

CONTINENTAL COFFEE LTD Vs COMMISSIONER OF CUSTOMS, CHENNAI

Customs – Valuation - Import of capital goods for setting up of plant for manufacture of ‘Spray Dried Instant Coffee’ as per the obligation of EPCU Licence – addition of lump sum fee paid to the overseas supplier towards technical knowhow under rule 9(1)(b)(iv) and Rule 9 (1) (c) of Customs Valuation Rules, 1988 - demand of differential duty of Customs was confirmed by invoking section 28 (1) covering the extended period – HELD – It is seen from the agreement that the seller would provide all the technical knowhow - As per clause the overseas supplier shall execute irrevocable bank guarantee to the appellant to the extent of 5% of the contract value of the technical knowhow for the performance of the plant and machinery for the assured input-output specifications. It is evident that the agreement is purely on supply of technical knowhow and nowhere in the said agreement any condition stipulated that appellant shall import machinery only from the supplier - The technical know how is purely related to transfer of technology for the manufacture of food processing equipment in India - It is also pertinent to see that is not the case of Department that appellants have imported the entire plant and machinery from the overseas supplier - the technical knowhow fee is for design, drawing and technical information provided to appellant by overseas supplier for setting up of plant which is purely a post-importation activity and not related to imported goods – value of technical knowhow is not addable to the value of imported goods - demand set aside and the imposition of redemption fine and penalty is also set aside – Assessee appeal allowed

 

dgftPN55

DGFT: Permission for export of Finished Leather, Wet Blue and EI Tanned Leather through ICDs

 

apGO13

Andhra Pradesh: Order regarding passing on the Purchase Tax amount of Rs.60/- per M.T. to the cane growers as Incentive for 2014-2015 crushing season

 

karNotiCR30

Karnataka: Submission of statement in Form VAT-125 containing particulars of tax deducted during preceding month electronically

 

FCP0701

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

 

12^th of Jan

 

Goods and Services Tax Network (GSTN) Paper

GST Eco-System & GST Suvidha Provider (GSP) - Design Consideration for GST system [Download link]

 

2016-VIL-21-BOM

M/s NAGPUR DISTILLERS PRIVATE LIMITED Vs THE STATE OF MAHARASHTRA

Maharashtra Municipal Corporation Act - Local Body Tax (LBT) – Constitutional validity of the provisions of sub-rule (1) of Rule 3 of the Maharashtra Municipal Corporation (Local Body Tax) Amendment Rules, 2015 – classification of dealers on the basis of turnover – validity of Levy of LBT on dealers having turnover exceeding prescribed limit – HELD - material placed on record is inadequate to comprehend the exact injury to the Petitioners or its extent - No data in respect of prices at which petitioner or exempt dealers sold their product before 31.3.2015 or after 1.8.2015 is produced for appreciation. Petitioners also do not show that such exempt dealers have reduced their selling prices while the Petitioners could not do so. There is no attempt to demonstrate that market share of the brands produced by the petitioners has decreased. Except for expressing the apprehension that they would be required to sell at reduced rate, no actual reduction in price of commodity has been brought on record. Possibility of 1162 dealers spread over the State diverting their business, floating new firms etc. can not be valid ground to assail the levy or classification. The law permits tax planning and if, the 1162 dealers on whom the State depends, attempt within four corners of law to avoid it, it is for the policy makers to look at the issue. Standing or position of these Petitioners vis-à-vis the LBT has remained unaltered even after the impugned amendments. Thus in these petitions, no cause of action is being made out and no legal injury is being substantiated - In absence of data and pleadings, the challenge is only academic - It is settled that in such matter, writ courts do not decide the issues only of the academic importance – Writ petition dismissed

 

2016-VIL-23-GUJ

LARSEN AND TOUBRO LTD Vs STATE OF GUJARAT

Gujarat Value Added Tax Act – Section 73 – Appeal – Demand notice primarily on the ground that the assessee favouring judgment of Tribunal is in appeal by the Department in High Court – exercise of revisional powers of Commissioner under section 75 – HELD - Once the Tribunal had decided a certain issue in favour of the assessee, the Commissioner was bound by such judgment. The judicial discipline required that the Commissioner did not ignore such pronouncement of the Tribunal. Merely because the Department was aggrieved by such judgment and challenged the same before the High Court, would not be ground enough to enable the Commissioner to exercise revisional powers and to set aside the order of appellate authority - in the present case, exercise of revisional powers was not the correct mode - impugned order is set aside and assessee application allowed

 

CENTRAL EXCISE SECTION

 

2016-VIL-31-CESTAT-CHE-CE

M/s 20 MICRONS LTD Vs CCE & ST, CHENNAI

Central Excise – Classification of chemically coated micronized minerals - whether classifiable under 3824.90 as per Revenue or under 25.05 as claimed by the appellants and whether red oxide powder is classifiable under chapter 2821.10 or under 25.05 as claimed by the appellants – HELD - the appellant is a manufacturer of chemically coated micronized minerals and in addition to uncoated products it is not the case of mixture of two products. By virtue of Chapter Note (2) of Chapter 25 chemically coated micronized minerals are rightly excluded from Chapter 25 - chemically coated micronized minerals are rightly classifiable under Chapter 3824.90 and not under Chapter 25.05 - The red oxide which is otherwise known as iron oxide and earth colour are specifically classifiable under Chapter 2821.10 as iron oxide and red oxide - no merit in the appellant’s claim of classification under general category under Chapter 25. The appellant’s only contention is that the products does not amount to manufacture is not justified as the process involved and also marketed clearly confirms that they are rightly classifiable under 2821.10 - the issue is of only classification dispute and the adjudicating authority has already dropped the demand for the extended period and also penalty under Section 11AC, and this clearly confirms that there is no malafide intention to evade payment of duty. Accordingly, the goods are not liable for confiscation - confirmation of demands is upheld. Confiscation, fine and penalties are set aside

 

2016-VIL-33-CESTAT-CHE-CE

SUJANA METAL PRODUCTS LTD Vs COMMISSIONER OF CENTRAL EXCISE, CHENNAI-II

Central Excise - ineligible and irregular credit of duty paid on MS scrap – Imposition of penalty by invoking Rule 15 (1) of CCR - circular paper transaction of flow of cenvat credit without physical movement of any inputs or goods - raising the documents for clearance of M.S. squares from appellant’s premises to the dealers’ premises and in turn from dealers’ premises back to the appellant’s premises without involving any manufacture of goods – HELD – It is the main appellant who created the chain by way of paper transaction of sale and transfer of goods and again the main appellant received back the same as receipt from the registered dealer - every dealer in this transaction had immediately neutralized the credit in respect of the entire quantity shown in the documents. Therefore, appellants intentionally used the central excise provisions under Rule 4 (1) of CCR, created cenvat documents and debited duty without physical movement of goods and in turn took back the credit without receipt of any goods, which is clear violation of Central Excise Act and Rules. Appellants have deliberately chosen this novel method of violating Central Excise Rules and CCR. Any misuse of the said Rules and the provisions whether for any gain under Central Excise or any other purpose is a clear contravention and liable for penal action - appellant’s intention of violation of CER is established beyond doubt and they are liable for penalty both under Rule 15 (1) and Rule 26 - appellant’s contention that penalty is imposable only under Rule 15 and not under Rule 26 (2) is not sustainable and not acceptable - However, considering the peculiar facts of the instant case, where this entire circular paper transaction was created by the appellant and also considering the fact that there is apparently no revenue loss to the Department, the quantum of penalty imposed by L.A is on the higher side - considering overall circumstances of the case, penalty imposed under Rule 26 (2) (i) (ii) is reduced – Assessee  appeal partly allowed

 

2016-VIL-34-CESTAT-CHE-CE

M/s CHEMPLAT SANMAR LTD Vs CCE, LTU CHENNAI

Central Excise - Cenvat Credit on MS plates, MS angles, MS channels – HELD - The authority has not at all examined each item of the goods to reach to a conclusion as to whether such goods can enjoy input credit or capital goods credit under the law - law is well codified in the statute as to the manner how the appellate Commissioner has to act. His duty is to determine the issue examining the material and relevant facts of the case, test the same with evidence on record as well as state the reason of his decision and record his decision - Violation of Natural justice is incurable at the appellate stage - the matter is remanded to the ld. Commissioner (Appeals) to hear the appellant afresh in the light of the development of law – matter remanded - in favour of assessee

 

SERVICE TAX SECTION

 

2016-VIL-32-CESTAT-AHM-ST

M/s BANCO PRODUCTS INDIA LIMITED Vs COMMISSIONER OF CENTRAL EXCISE & S.T., VADODARA

Service Tax – Refund – reject of refund on ground of limitation - whether the date on which the original refund claim was filed, should be considered as the date of filing the refund claim, or the date of filing the revised application should be the relevant date – HELD – The appellant filed a revised claim after a couple of months realising that there was some wrong calculation or error in the original refund claim - action of the appellant bonafide as it does not in any way negate the original refund claim which was filed within the time limit - the action of the appellant of suo-moto omitting the portion of the refund claim not eligible for refund has only facilitated the department and does not vitiate the original refund claim. Hence, the decision of the lower authorities to hold that a portion of the refund claimis barred by limitation on the ground that the revised claim was filed after the prescribed time limit is unfair, unjust and not sustainable - Appeal is allowed by way of remand

 

2016-VIL-35-CESTAT-DEL-ST

M/s PRABHU DAN DETHA & CO. Vs CCE & ST, JAIPUR-II

Service Tax - pre-deposit - service tax paid on the actual receipts - impugned demand confirmed on the amount on the accrual basis - TDS deduction as an evidence of actual receipt of the payment – period 1.4.207 to 31.3.2008 - HELD - there is force in the contention of the appellant that the observation of the primary adjudicating authority that TDS certificate is necessarily to be taken as proof of actual receipt of the value of service is not legally valid. As per Rule 6 of Service Tax Rules, 1994 (as existed during the relevant period), the liability to deposit of service tax arose only when payments are received towards the value of taxable service rendered - requirement of pre-deposit waived - appeal allowed by way of remand to the primary adjudicating authority for de novo adjudication

 

CUSTOMS SECTION

 

2016-VIL-24-DEL-CU

T.T. LTD Vs UNION OF INDIA

Customs – Rejection of grant of Duty Credit Scrips under the Foreign Trade Policy (FTP) 2009-14 - Incremental Exports Incentivisation Scheme - petitions seeking a declaration that the Notifications Nos. 43 and 44 dated 25.09.2013 are unconstitutional – HELD - careful consideration of the FTP 2009-14 as well as the Schemes in question vide paragraphs 3.14.4 and 3.14.5 read with the amendment vide Notifications dated 25.09.2013, we do not find any substance in the contention of the petitioner that the impugned amendments are sought to be enforced by the respondents with retrospective operation - agree with the submission of the learned ASG that the amendments vide Notifications No.43 and 44 dated 25.09.2013 are only clarificatory and in no way affect the rights accrued to the petitioner to claim the benefit of Duty Credit -  Even otherwise the law is well settled that grant of concession or incentive being the privilege of the Government, the Government has right to give retrospective operation or even to withdraw the same for justifiable reasons and in public interest – However, in view of sub paragraph (ii) added to paragraphs 3.14.4(c) and 3.14.5(c) of FTP 2009-14 vide impugned notifications dated 25.09.2013 which states “Claims in excess of this value will be subjected to greater scrutiny by Regional Authority”, the petitioner’s claims ought not to have been rejected without assigning any reasons. It appears that the Clause (ii) requires the Regional Authority to pass a reasoned order on application of mind to the contents of the applications which fall under the said clause - Respondent is directed to ensure that a speaking order is passed in terms of Clause (ii) of paragraph 3.14.4(c) and 3.14.5(c) of FTP 2009-14 regarding the claims made by the petitioner - Writ petition partly allowed

 

2016-VIL-36-CESTAT-CHE-CU

M/s PETRO ARALDITE PVT LTD Vs CC, CHENNAI

Customs – Valuation – HELD - technical knowhow, drawing and design fee and engineering services fee, are not includable in the transaction value of the imported goods - impugned order is set aside assessee appeal allowed

 

rajNoti112

Rajasthan: Amendment in Rajasthan Investment Promotion Scheme - 2014

 

act9of2016

Sugar Cess (Amendment) Act, 2015 - Amendment of section 3

 

cuNoti03NT

Customs: Regarding goods to which the provisions of that section shall apply when they are deposited in a warehouse

 

cuNoti12NT

Customs: Amendment in Exchange Rate Notification No. 02/2016-Cus (NT) dt. 07-01-2016

 

cuNoti03

Customs: Rescinds Notification No. 09/95-Customs dated 06.03.1995 [[Exemption to specified goods when imported into India from the Union of Myanmar]

 

ceCir1013

Central Excise: General guidelines for implementation of e-payment of refund/rebate

 

13^th of Jan

 

VAT SECTION

 

2016-VIL-26-P&H

M/s PIONEER ELECTRONICS Vs UNION TERRITORY OF CHANDIGARH

Central Sales Tax Act – production of non-genuine 'C' Forms – imposition of penalty – HELD - appellant has not referred to any cogent and convincing evidence or material on record to controvert the findings recorded by the authorities below - No explanation much less satisfactory explanation was given by the learned counsel for the appellant for submitting non-genuine 'C' Forms - the appellant cannot derive any advantage from the cited decisions - no merit in the assessee appeal, the same is dismissed

 

2016-VIL-22-BOM

THE COMMISSIONER OF SALES TAX, MAHARASHTRA Vs M/s VEER RADIOS

Maharashtra Sales Tax Act, 1959 – Return - Belated filing of return – application of sub-section (5) or sub-section (3) of section 33 of the Act – Levy of penalties – HELD - Perusal of order of the sales tax officer does not show that it is in exercise of best judgment that the assessment has been done. On the contrary, the entries in the books of account varying with returns filed are relied upon and then the assessment has been completed - No provision has been pointed out to this Court which prohibits the department from looking into the returns which are filed belatedly i.e. after prescribed date. The provisions of Explanations I and II of Section 36(2)(c) of the said Act are no doubt mutually exclusive, but then that does mean that the provisions of Sections 33(3) and 33(5) of the said Act are also mutually exclusive. If the return is filed belatedly and it does not give correct and complete figures, the provisions of Section 33(3) of the said Act can be applied by the department to such return – Revenue appeal allowed

 

CENTRAL EXCISE SECTION

 

2016-VIL-25-CAL-CE

CCEC&ST, BHUBANESHWAR-I Vs M/s VEDANTA ALUMINIUM LIMITED & ORS

Central Excise – Order of Settlement Commission - Single Judge bench setting aside the order of penalty imposed by the Commission holding it as severable and legally unsustainable – Revenue in appeal – HELD – the assessee instead of filing a reply to the notice and having the case adjudicated, filed applications before the Commission for settlement. So the respondents opted for settlement before the Commission - Thus having opted for settlement and having accepted the amount of excise duty payable by them, the respondents cannot now turn back and challenge the penalty imposed by filing a writ petition because it would mean arguing the case on merit which under section 33 of the Act can only be dealt with and decided by an adjudicating authority - The words “and also” in section 32K make the order of prosecution and penalty inseverable. Since an order passed by the Commission is an agreement in a statutory form, the assessee, having been granted immunity from prosecution, cannot challenge the imposition of penalty only. Under the statute the order of penalty is not segregable. As the order of penalty and prosecution cannot be segregated, either the applicant accepts the order in its entirety or the settlement fails - assessee having accepted immunity from prosecution and as the order is inseparable, such reservation of rights is unacceptable. It is against the scheme of the Act which shall make section 32K(2) otiose. In our view payment made pursuant to an order passed by the Commission cannot be conditional as it goes against the basic principles of settlement - the impugned judgement to the extent it sets aside the levy of penalty imposed by the Commission and directs refund of penalty amount paid and/or realised from the writ petitioners, is set aside and quashed – Revenue appeal allowed on merit

 

2016-VIL-01-SC-CE

M/s VEDANTA ALUMINIUM LIMITED Vs CCEC&ST, BHUBANESHWAR-I

Central Excise – Order of Settlement Commission – HELD - Since an order passed by the Commission is an agreement in a statutory form, the assessee, having been granted immunity from prosecution, cannot challenge the imposition of penalty only. Under the statute the order of penalty is not segregable – Assessee appeal dismissed

 

2016-VIL-40-CESTAT-ALH-CE

M/s GAIL INDIA LTD Vs COMMISSIONER OF CENTRAL EXCISE, LTU, DELHI

Central Excise - sub-rule 13 of Rule 57T – condonation of delay in filing of declaration for availing CENVAT credit on the capital goods under Rule 57T (1) of the CER, 1944 - denial of the capital goods credit, primarily on the ground of delay in filing the declaration – HELD - so long as receipt and duty paid nature of the goods is not challenged, the delay in filing the declaration can be condoned – Assessee appeal allowed

 

2016-VIL-37-CESTAT-MUM-CE

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

Central Excise – classification – dispute period April 1993 to December 1997 – limitation – demand of differential duty on the ground of suppression, mis-declaration – penalty – HELD - the classification lists were approved finally, would mean that the appellant had submitted all the relevant information required for the approval of classification list of the products manufactured by them. In the absence of any evidence indicating otherwise, the findings recorded that the appellant had not given various raw material composition, chemical composition etc. seems to be presumptive and without any basis - during the period from April 1993 to June 1995 classification lists being approved by the Revenue authorities, it cannot be said that the appellant had mis-stated or suppressed information with intention to evade duty. For the period from June 1995 onwards, approval of classification list by the revenue authorities was done-away, but during the period in question i.e. from June 1995 to December 1997, there was a system of filing declaration of the products manufactured with cross reference of approved classification list. If that be so, strong force in the arguments put forth by the learned Counsel that the demands are hit by limitation - demand of duty liability on reclassification of the product from Chapter 29 to Chapter 39 is upheld only for the period of six months prior to the date of issuance of show-cause notice; demands for the period from April 1993 to March 1997 are set aside as hit by limitation

 

CUSTOMS SECTION

 

2016-VIL-41-CESTAT-MUM-CU

M/s AIR INDIA LTD Vs COMMISSIONER OF CUSTOMS (EXPORT), ACC, MUMBAI

Customs - whether the amendment under Section 149 can be made in respect of free shipping bills to drawback shipping bills – HELD - Revenue has the power for conversion of free shipping bill to drawback shipping bill subject to the establishment of identity. The conditions laid down in the various circulars regarding time limits etc. are waived. The order is set aside and the matter is remanded to the original adjudicating authority for examination on above lines – Appeal allowed by remand

 

2016-VIL-27-DEL-CU

FAIRDEAL POLYCHEM LLP Vs UNION OF INDIA

Customs - Anti-Dumping Duty Rules, 1995 - Imposition of anti-dumping duty on Acrylonitrile Butadiene Rubber (NBR) imported from Korea RP and anti-dumping duty on imports of Phenol - petitioners seek the quashing of the review proceedings as reviews have not been concluded within the period of 12 months from the dates of their initiation - whether the provision of extension of time contained in the first proviso to rule 17(1) can be pressed into service for extending the time of 12 months for concluding a review under rule 23(2) because of the mutatis mutandis prescription in rule 23(3) - interpretation of term ‘mutatis mutandis’ – HELD – to bring the provisions of rule 23(2) in harmony with Article 11.4 of Agreement of 1994, rule 23(2) would have to be read as – any review initiated under sub-rule (1) shall “normally” be concluded within a period not exceeding twelve months from the date of initiation of such review. And, when the first proviso of rule 17(1) is applied (with necessary changes) to the case of a review it becomes immediately clear that the period of 12 months can be further extended by the Central Government in its discretion by 6 months but only if special circumstances exist - That being the case, the Central Government has the power to grant an extension of 6 months for concluding a review - the provision of extension of time contained in the first proviso to rule 17(1) can be pressed into service for extending the time of 12 months for concluding a review under rule 23(2) because of the mutatis mutandis prescription in rule 23(3) - the writ petitions are liable to be dismissed - However, the petitioners have the liberty to challenge the extensions and their fall-outs on merits before the appropriate forum

 

SERVICE TAX SECTION

 

2016-VIL-02-SC-ST

COMMISSIONER OF SERVICE TAX, NEW DELHI Vs M/s PETRONET LNG LTD

Service Tax - Supply of tangible goods (STGU) - Transfer of possession and effective control of the tankers – Supreme Court stays operation of CESTAT order in Petronet LNG case

 

2016-VIL-38-CESTAT-CHE-ST

SMT. A. VIJAYA Vs CCE, SALEM

Service Tax - Direct retail sale - service tax liability on the commissions received for undertaking promotion / marketing / sale of the goods – HELD – though the service tax is not liable to be paid on the profit earned by the distributors from sale of goods in retail - service tax demand in respect of commission received by the appellants on direct retail sale is liable to be sustained and the service tax on the commission received for sale of goods through second and third level distributors is sustained - impugned orders are set aside and matter remanded to the adjudicating authority with the direction to re-quantify the service tax demand on the commission received on the volumes of purchases made by the distributors, sponsors enrolled by the particular distributor - appeals are allowed by way of remand

 

2016-VIL-39-CESTAT-MUM-ST

AHMEDNAGAR CANTONMENT BOARD Vs CCE, AURANGABAD

Service Tax - Renting of Immovable Property – construction and leasing of commercial properties by Cantonment Board – collection of licence fee – Demand and penalties imposed under Section 76, 77 and 78 of the Finance Act, 1994 – HELD - the appellant had discharged the entire service tax liability and interest thereof during the pendency of proceedings - the Office Superintendent of the appellant has categorically recorded that they were under the impression and view that they being autonomous body they are exempted from payment of service tax and hence did not obtain registration - the bonafide impression carried by the appellant herein cannot be called in doubt - appellant is an autonomous body, penalty imposed need not to be upheld - penalty imposed under various sections of the Finance Act is set aside

 

delNoti1921

Delhi: Filing of Form GE-I and GE-II by Government Entity

 

wbNotiFT25

West Bengal: Amendment in WBVAT Schedule A and Schedule C - Regarding Solar devices

 

14^th of Jan

 

2016-VIL-28-ALH

M/s VADILAL ENTERPRISES LIMITED Vs STATE OF U.P.
Central Sales Tax Act – resale – inter-State trade or commerce - denial of C-Form – transfer of right to use any goods – lease rent - interpretation of words "for resale" as used in Section 8(3)(b) of the Act – Section 7(4)(a) - Amendment in registration certificate – Resale of goods purchased from outside the State - purchase tricycles and deep-freezers from the manufacturers outside the State and providing the same on lease rent to distributors – HELD - deep-freezers and tricycles are re-sold to the distributors and dealers of the petitioner in the same form and condition as a transfer on the right to use the goods. Such "transfer of the right to use the goods" is a "sale" as defined under the CST Act as well as under the VAT Act. The goods purchased by the petitioner as per the products indicated in the certificate of registration are clearly intended "for resale" by it and consequently, the petitioner is entitled for issuance of Form-C  - The contention that no mandamus could be issued at this stage for issuance of Form-C for the year 2010-11, 2011-12 and 2012-13 in view of Section 12(7) of the CST Rules is patently erroneous - Deputy Commissioner committed a manifest error in rejecting the petitioner's application for issuance of Form-C, on the ground that the registration certificate has been amended - the amendment made in the registration certificate could not apply retrospectively - Applications which are pending prior to the amendment of the registration are required to be considered as if the registration certificate had not been amended - the impugned orders cannot be sustained and are quashed. The order amending the registration certificate is quashed as well as the order refusing to grant Form-C is also quashed. A writ of mandamus is issued commanding the Deputy Commissioner to issue Form-C - The writ petitions are allowed

 

2016-VIL-29-ALH

M/s O.P. ENGINEERING Vs THE COMMISSIONER, TRADE TAX

U.P. Trade Tax Act – Rate of tax on Aluminium Grills – Tribunal holding it as items parts of Air Conditioners or Air Coolers chargeable at the rate of 15% as unclassified items – HELD - The Tribunal views were influenced by the fact that some of the orders placed are from the Air Conditioning Industry. Therefore, it cannot be said that an Aluminium Grill on its own, can only be used by the Air Conditioning Industry - On the contrary a Aluminium Grill can be used at any place in a house or, even in an industrial accommodation. One cannot confine its use or air conditioning or cooling equipment alone - Aluminium Grill cannot be said to be an integral part of the Air Conditioning or Air Cooling plant, and therefore, cannot be taxed at the rate of 15% - answered in favour of the assessee and against the department

 

2016-VIL-45-CESTAT-DEL-CE

M/s ANNAPURNA MALLEABLES PVT LTD Vs CCE, RAIPUR

Central Excise - Valuation – testing charge - includibility of expenses reimbursed by the Railways towards testing charges by RDSO in the assessable value – HELD - if the goods are not sellable without any testing done by the assessee, in that case, the testing charges are includible in the assessable value as after testing/inspection the goods are marketable. But in a case where the testing has been done on a particular request by a buyer and the testing charges has been reimbursed by the buyer, in such cases, the testing charges are not includible in the assessable value as the goods are marketable without testing / inspection done on behalf of the buyer - The adjudicating authority is directed to ascertain from the facts of the case whether the goods are marketable without testing done by RDSO or not? If the goods are marketable without testing done by RDSO, in that case, the testing /inspection charges are not includible in the assessable value. If the goods are not marketable without testing done by RDSO, in that case, the testing/inspection charges are includible in the assessable value. The adjudicating authority shall verify the records and if required, pass an order to demand duty accordingly – matter remanded

 

2016-VIL-44-CESTAT-MUM-CE

MUNGI ENGINEERS P. LTD Vs COMMISSIONER OF CENTRAL EXCISE, NASHIK

Central Excise – refund of excise duty paid twice – scrap generated at the level of job worker – excise duty paid on scrap - As per the appellant, duty was paid twice on the same scrap one by the appellant and one by the job worker – Denial of refund – HELD - on the one hand the appellant is stating that the scrap only came back from job workers premises; that the enclosed invoices indicating that the removal has taken place under the assessee’s own premises. The commissioner also observed that the appellant has admitted to have indulged in fabrication of invoice by showing thereon imaginary road tempo no., imaginary quantity / assessable value/ duty on scrap etc. - no infirmity in the impugned order. Consequently, the appeal of the appellant is dismissed

 

2016-VIL-42-CESTAT-AHM-ST

M/s PSP PROJECTS PVT LIMITED Vs COMMISSIONER OF SERVICE TAX, AHMEDABAD

Service tax – Merger of companies – availment of PLA balance of merged company – HELD - Since M/s. BPC Projects merged with M/s. PSP Projects Pvt. Limited, the legal existence of M/s. BPC Projects ceased - Whatever assets and liabilities M/s. BPC Projects had were automatically vested on M/s PSP Projects Pvt Ltd - merely because M/s BPC Projects had not surrendered the service tax registration, it cannot be said that PLA balance lying unutilised was available with M/s. BPC Projects even after date of merger - M/s PSP Projects Pvt. Limited was the successor and the only legal entity with effect from date of merger and hence was legally entitled to utilise the unutilised PLA balance - non-observance of procedure of intimation to Range Superintendent etc. is only a technical violation, if any - the demand of short levy is not fair and just, nor can it be legally sustained - impugned order set aside - assessee appeal allowed

 

2016-VIL-43-CESTAT-MUM-CU

COMMISSIONER OF CUSTOMS, GOA Vs M/s BIRLA FURUKAWA FIBER OPTICS LTD

Customs - refunds of the SAD under Notification No. 102/07-Cus dated 14.9.2007 – rejection of refund claims on the grounds that payment of 4% SAD has not been made by cash, but has been paid using the Reward Scrip i.e. Focus Product Scheme - Commissioner (Appeals) allows refund – revenue in appeal – HELD - entire grounds of appeal are based on Circular issued by Board and at no stage they rely or even cited the provisions of any Notification or Rules - there is no condition in Notification No. 102/07 that SAD should initially be paid through cash - right given under any Notification cannot be taken away by issue of Circular - impugned order is upheld and appeals filed by the Revenue are dismissed

 

dndNoti10

Daman & Diu: Date of effect of enhancement in rate of tax under Third Schedule from four to five percent

 

bihNotiSO8

Bihar: amendments in BVAT Schedule-I

 

bihNotiSO10

Bihar: Amendments in BVAT Schedule-III

 

harNotiLeg1

Haryana Value Added Tax (Amendment) Ordinance, 2016 - Substitution of section 59A - Amnesty Scheme