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2026-VIL-114-CESTAT-DEL-ST | CESTAT SERVICE TAX

Service Tax - Data hosting services, Intermediary services or Export of services - Appellant is engaged in providing data hosting services and marketing services to Amazon Web Services, Inc. USA (AWSI) under the Data Services Agreement and Marketing Services Agreement - Department case that the appellant acts as an intermediary between AWSI and its customers located in India by temporarily holding and routing the data through the edge servers installed in India, and thereby facilitating the provision of cloud computing services by AWSI to its Indian customers - Demand of service tax on the data hosting services and marketing services provided by the appellant, treating it as an intermediary service - Whether the appellant is covered under the definition of 'intermediary' under Rule 2(f) of the Place of Provision of Service Rules, 2012 and therefore liable to pay service tax on the data hosting services provided to AWSI – HELD - As per the agreement, the appellant is rendering only one service, i.e. data hosting services to AWSI. The cloud computing services provided by AWSI to its customers is by virtue of a separate agreement between them, to which appellant is not a party. The role of the appellant is altogether for an independent activity in the nature of data hosting services, which is one of the inputs for provision of cloud computing services by AWSI. There is no scope for arranging or facilitating any provision of service by the appellant. the appellant is providing the data hosting service on his own account. The appellant is not an 'intermediary' as defined under Rule 2(f) of the Place of Provision of Service Rules, 2012 - The requirements and conditions to be an intermediary either under the POPS Rules or under IGST Act are absolutely same. There is no difference even in the meaning of the term ‘intermediary’ as defined under the two provisions. In this context, considering the definition under the two provisions, CBIC has taken the view that broadly there is no change in the scope of intermediary services in the GST regime vis-a-vis the service tax regime, except addition of supply of securities in the definition of intermediary in the GST law – In the clarification issued by the CBIC in Circular No. 232/26/2024-GST dated September 10, 2024, it was clarified that the data hosting service provider, who provides data hosting services to the cloud computing service provider on a principal-to-principal basis on its own account, cannot be considered as an 'intermediary' - The definition of intermediary in the GST regime which has been picked up from the service tax laws squarely covers the issue at hand and consequently, the appellant cannot be held to be an intermediary as the services provided are export of services. Accordingly, the demand of service tax on the data hosting services is set aside. The issue of penalty and interest on the marketing services is remanded to the Adjudicating Authority for a limited examination - The appeal is allowedrnrnIssue 2: Whether the appellant is liable to pay penalty and interest on the service tax paid on the marketing services before the issuance of the show cause notice – HELD – The matter is remanded the issue of penalty and interest on the marketing services to the Adjudicating Authority to examine whether the appellant had paid the interest amount before the issuance of the show cause notice. If the appellant had paid the interest amount along with the service tax before the issuance of the show cause notice, the provisions of Section 73(3) of the Finance Act, 1994 would apply, and no penalty would be leviable. [Read less]

2026-VIL-06-SC-ST | Supreme Court SERVICE TAX

Service Tax - Event management service, Services of Booking agents, Demand under Reverse charge mechanism - Appellant engaged booking agents to book speakers for the event – Demand of service tax on the fees paid to the speakers through the booking agents under the category of "Event Management Service" – Vide the impugned order the Tribunal, set aside the invocation of the extended period of limitation but affirmed the demand under the normal period of limitation under the category of "Event Management Service" - Whether the fee paid by the appellant to the personalities/speakers, through their booking agents, is liable to Service Tax under the reverse charge mechanism under the taxable category of “Event Management Service” under Sections 65(40) and 65(41) read with Section 65(105)(zu) respectively of Chapter V of the Finance Act, 1994 – HELD - The agreements between the appellant and the booking agents were in the nature of booking particular speakers for the Summit. The services rendered by the agents were in the capacity of booking agents and not event managers - The services rendered by such agents to the assessee were in the nature of booking the speakers for the event to be organized by the assessee. The contracts were entered into with the agents qua each speaker laying down the modalities of his/her visit and consideration for the same. Such services cannot be equated with “event management service” - The agents were not engaged in managing the venue, decoration, sound, light, security, communication, sale of tickets, or publicity of the event, nor were they involved in the planning, promotion, organization, or presentation of the Summit – In view of principle of strict interpretation of taxing statutes, the service in question does not fall within the definition of "Event Management Service" as provided under the Finance Act – Further, applying the common parlance understanding of “event management”, the expressions ‘event management’ and ‘event managers’ is commonly understood in the sense of appointing someone to manage or organize the event. Individual contract for booking of persons required for participation in the event are not commonly understood as “event management” contracts - The fee paid by the appellant to the personalities/speakers, through their booking agents, is not liable to Service Tax under the category of "Event Management Service" under the Finance Act – The impugned order is set aside and the appeal is allowed - The argument of the revenue that, without the speaker the event would be devoid of any significance and therefore, the service in question is an “Event Management Service”, also deserves to be rejected. That the presence of the speaker is essential for the event cannot be disputed. However, whether the service of the speaker or the agent on behalf of the speaker can be considered to be “event management service” is altogether a different issue. The speaker does not plan, promote, organize or present the event. Thus, the speaker, is neither an “event manager” nor does he provide an “event management service”. Similarly, the booking agent who merely books the speaker also acts in the capacity of an agent or representative for agreeing to the terms of the speakers’ presence at the event. Participation in the event cannot be considered as management of the event. This precisely is the fundamental error committed by the revenue as well as by the Tribunal while imposing Service Tax on the service in question under the category of “event management service”. [para 39, 40, 41] [Read less]

2026-VIL-95-CESTAT-ALH-CE | CESTAT CENTRAL EXCISE

Central Excise - Refund of excise duty paid on fly ash, limitation period for filing refund claim - Appellant filed a refund application under Section 11B of the Central Excise Act, 1944 seeking refund of excise duty paid under protest on clearance of fly ash. The refund claim was made after the dismissal of the department's appeal by the Supreme Court against the Madras High Court judgment holding that fly ash is not an excisable good - Whether the refund claim filed by the appellant is hit by the one-year limitation period under Section 11B of the CEA, 1944 – HELD - The refund claim was not hit by the limitation period... [Read more]

2026-VIL-99-CESTAT-DEL-CE | CESTAT CENTRAL EXCISE

Central Excise - Reversal of CENVAT credit on electricity sold to State Electricity Board, Penalty under CENVAT Credit Rules - Appellant availed CENVAT credit on inputs and input services used in its Captive Power Plant for generating power, which was partly consumed in the factory, partly transferred to its sister concerns, and partly sold to the State Electricity Board - Department objected to the appellant's CENVAT credit claim on the portion of electricity wheeled out to the sister concerns and sold to the State Electricity Board - Whether the appellant was justified in availing CENVAT credit on inputs and input servic... [Read more]

2026-VIL-51-ORI-CU | High Court CUSTOMS

Customs - Export duty on iron ore fines, Acceptance of test reports, assessment on wet metric ton (WMT) basis – Respondent-assessee exported iron ore fines and the Customs duty was determined based on the test report of a private NABL accredited agency indicating the iron content (Fe%) to be less than 58% on WMT basis - Customs department rejected this report and relied on the test report of the Central Revenues Control Laboratory (CRCL), which showed the Fe% to be more than 58% on dry metric ton (DMT) basis, and accordingly levied export duty. The Respondent's appeal against this was allowed by the Commissioner (Appeals) and the CESTAT - Whether the CRCL test report showing higher Fe% on DMT basis should be relied upon over the private agency's report on WMT basis for the purpose of levying export duty - HELD - The Courts have consistently held that for determining export duty, the Fe% has to be calculated on WMT basis as per the Supreme Court decision in Gangadhar Narsingdas Agrawal case, which was the prevailing legal position at the time of these exports. The final invoice and payments were also based on the WMT Fe% as per the contract between the parties. The CRCL report on DMT basis was therefore not relevant for the purpose of levy of export duty. The CESTAT was justified in relying on the private agency's report on WMT basis over the CRCL report – Further, the questions raised by the Revenue were essentially based on findings of fact and the legal position prevailing at the relevant time. As the legal position is well settled, the questions raised by the Revenue do not involve any "substantial question of law" that would warrant interference by the High Court. The concurrent findings of fact by the lower authorities also could not be disturbed - No "substantial question of law" arose from the CESTAT's order, which had correctly relied on the private agency's report on WMT basis for determining the export duty liability – The Revenue appeal is dismissed [Read less]

2026-VIL-49-CAL | High Court SGST

GST - Deviation from notice to show cause, Opportunity of hearing, Access to information in GST portal – Petitioner, a road transport carrier company, was served with show cause notices alleging that the turnover of outward supplies declared by the petitioner in GSTR 3B was less than the actual supplies - The adjudication order, however, held the petitioner liable on a different ground, that the petitioner had opted to pay tax under the Forward Charge Mechanism and therefore the supplies made under the Reverse Charge Mechanism should be treated as taxable under the Forward Charge Mechanism - Whether the adjudication order, which was based on a ground different from the one mentioned in SCN, is valid - HELD – The adjudication order is not valid as it had deviated from the grounds mentioned in the show cause notice. The adjudication order is in violation of Section 75(7) of the CGST Act, 2017 which prohibits confirmation of demand on grounds other than those specified in the notice. In the case at hand the adjudicating authority has done exactly that which has been prohibited - It is now very well settled that an order cannot travel beyond the confines of the preceding notice to show-cause and a person who has been issued a notice to show cause on a particular point cannot be blindsided by passing an order on an entirely different point - the appellate authority has trivialised the error by stating that it was a “technical issue” as it pertained to mere quantification. The appellate authority should also not have made light of such statutory violation by a statutory authority by calling it a mere technicality, as it involved the interpretation of the applicability of the notification to the petitioner's supplies under the RCM - Further, since the SCN was based on data from the GST portal, which may not be accessible to the petitioner, the petitioner should have been provided the relevant information to effectively reply to the notice - The appellate order and the adjudication order are set aside and the matter is remanded back to the Proper Officer for reconsideration after providing the petitioner an opportunity of hearing and access to the relevant information – The petition is disposed of [Read less]

2026-VIL-98-CESTAT-DEL-ST | CESTAT SERVICE TAX

Service Tax - Blasting service for preparation of agricultural land or digging of wells, agricultural activities or not, negative list - Appellant was engaged in providing 'blasting service' by using explosive materials for boring, digging tube well, bore well and wells - Service tax demand on the blasting services provided for the preparation of agricultural land or digging of wells, as these services are not covered under the negative list nor exempted under any notification. The appellant contended that the blasting service is not a separate activity but forms part of the main activity of digging bore wells/tube wells, and no separate payment was received for the blasting service, so the levy of service tax is unsustainable - Whether the blasting service provided for digging of wells for agricultural purposes is covered under the negative list of services under Section 66D(d)(i) of the Act or is exempt under Notification No.25/2012-ST – HELD - The blasting services provided for digging of wells for agricultural purposes are covered under the negative list of services under Section 66D(d)(i) of the Act, as these services are 'relating to agriculture or agricultural produce' and are 'directly related to the production of any agricultural produce' - Where a definition uses the word "includes", the word defined not only bears its ordinary, popular and natural meaning but also the extended statutory meaning. The term 'including' used in the provision indicates that the agricultural activities covered are not restricted to the ones specified, but the list is non-exhaustive. The activity of facilitating water for agriculture by means of blasting for the purpose of tube-wells, bore-wells for fields, are in fact services relating to agriculture by way of agricultural operations - Further, the appellant had contended that no separate payment was received for the blasting service, and in the absence of consideration, which is a fundamental requirement for the levy of service tax, the demand is unsustainable - The impugned order is set aside and the matter is remanded back to the Original Authority to consider the documents, which may be placed by the appellant. The appeal is allowed by way of remand [Read less]

2026-VIL-47-CAL | High Court SGST

GST - Enhancement of tax liability without prior opportunity to the taxpayer – The appellate authority imposed additional tax on the petitioner on the ground that the petitioner had claimed excess zero-rated supply, which ground was not raised in the show cause notice - Whether the appellate authority was justified in enhancing the petitioner's tax liability on the ground of excess zero-rated supply without giving the petitioner an opportunity to be heard on this issue – HELD - The issue of the petitioner's turnover of taxable supply was not part of the adjudication order and was not impugned before the appellate autho... [Read more]

2026-VIL-97-CESTAT-KOL-CE | CESTAT CENTRAL EXCISE

Central Excise - Availment of CENVAT Credit by a 100% EOU on finished goods at the time of debonding – Appellant was a 100% EOU that obtained in-principle exit and finally debonded from the EOU scheme. At the time of debonding, the appellant paid central excise duty on its capital goods, finished goods (pig iron and slag), and inputs lying in stock. The appellant then availed CENVAT Credit on the duty paid on the finished goods, treating them as 'inputs' for the DTA unit - Whether the appellant was entitled to avail CENVAT Credit on the duty paid on its own finished goods at the time of debonding from the EOU scheme – ... [Read more]

2026-VIL-107-CESTAT-CHE-CU | CESTAT CUSTOMS

Customs – Classification of “Door Latch and Actuator Assembly” – Appellant imported Door Latch and Actuator Assembly by classifying same under Customs Tariff Item (CTI) 87089900 and availed benefit of concessional rate of duty under Notification No.46/2011-Cus – Department issued SCN proposing re-classification of imported goods under CTI 83012000, denial of benefit of concessional rate of duty and confiscation of imported goods – Adjudicating Authority confirmed proposals made in show cause notice – Whether imported goods are qualified to be considered as a semi-finished locks of a kind used in automobiles capable of performing essential function of a lock or not – HELD – During investigation, Appellant had explained that imported goods are parts of Door Lock systems and they are used along with other components procured from domestic manufacturers such as handles, wiring harness, lock cylinders and screws. Imported items are not capable of performing any independent function of a lock, since substantial and vital manufacturing process along with other procured components are required to make it as a lock, which is capable of being fitted into an automobile vehicle. Imported Door Latch and Actuator Assembly have been held to be classified as ‘parts of Automobile Locks’ under CTI 83016000 and not under CTI 83012000. In view of this, observation of Adjudicating Authority is unsustainable – Appeal is allowedrnrnIssue 2: Customs – Entitlement of preferential rate of duty – Whether benefit of preferential rate of duty can be denied or not – HELD – At time of import and clearance of goods, Appellant had sought benefit of preferential rate in terms of Sl.No.1478(I) of Notification No.46/2011. Said Notification provides benefit of preferential duty for all goods classifiable under CTH 870895 to CTH 870899 and applicable rate of Basic Customs Duty is 5%. Country of Origin Certificate issued by Competent Authority at Country of Export is valid and legal and, as a result, at this stage, there is no authority or power conferred to deny benefit availed under said notification. Impugned order denying benefit of preferential rate of duty is clearly unsustainable.rnrnIssue 3: Customs – Order of confiscation – Sustainability – Whether imported and cleared goods are liable for confiscation due to an attempt in reclassification of imported goods – HELD – There is no documentary evidence placed on record by Revenue to substantiate that their attempt for reclassification was an outcome of any commission or omission of Appellant. There is no finding concerning any fraudulent intention or mala-fide action of Appellant to seek wrong classification to avail benefit of preferential rate of duty. In absence of any credible evidence or prima facie material, imported goods are not liable for confiscation. Impugned order passed by Adjudicating Authority is set aside. [Read less]

2026-VIL-109-CESTAT-DEL-CU | CESTAT CUSTOMS

Customs – Import of electronic components – Allegation of undervaluation – Demand of duty – Appellant is engaged in sale of various types of Phillips brand transistors, diodes and other electronic components – On completion of investigation, department issued show cause notice alleging undervaluation of electronic components imported by Appellant – Commissioner confirmed demand of duty along with interest and penalty – Whether electronic components imported by Appellant was of Phillips brand and had been deliberately undervalued in order to evade customs duty – HELD – Allegation of undervaluation must be ... [Read more]

2026-VIL-113-CESTAT-CHE-ST | CESTAT SERVICE TAX

Service Tax – Sections 65(105)(zzg), 73(1), 77 and 78 of Finance Act, 1994 – Special Economic Zones Act, 2005 – Section 26 – Providing of garden related services – Tax liability – Appellant is engaged in providing garden related services – Department opined that activities undertaken by Appellant constituted maintenance of gardens, which is taxable under Section 65(105)(zzg) of the Act – Department issued show cause notice proposing demand of service tax by invoking extended period of limitation – Commissioner confirmed demand proposed in show cause notice – Whether landscaping and garden maintenance activities undertaken by Appellant are classifiable as taxable services – HELD – Contracts and invoices on record unmistakably show that Appellant was entrusted with upkeep, preservation and periodic maintenance of existing gardens and parks and not with one time development or creation of new horticultural assets. Services rendered by Appellant clearly satisfy the definition of management, maintenance or repair service. Activities are correctly classifiable as taxable “management, maintenance or repair service” – The appeal is partly allowedrnrnIssue 2: Service Tax – Rendering of services to municipal corporation – Demand of tax – Whether services rendered by Appellant to Coimbatore City Municipal Corporation constitute sovereign functions under Article 243W of the Constitution – HELD – There is no dispute that maintenance of parks and gardens is a municipal function and such functions may be outsourced to private agencies. Article 243W of the Constitution only identifies municipal responsibilities and it does not grant tax immunity to private entities executing outsourced work. Appellant does not step into shoes of State or municipality merely because the work relates to a municipal function. Service tax law exempts services rendered by Government and not services rendered to them by private contractors. Services rendered by Appellant to Coimbatore Municipal Corporation cannot be treated as sovereign functions and are not immune from levy of service tax. Appellant is liable to tax on this score.rnrnIssue 3: Service Tax – Sale of plants – Tax liability – Whether sale of plants, manure, soil, milk etc. attracts service tax – HELD – It is well settled that pure sale of goods involving transfer of property in goods is outside scope of service tax in view of Article 366(29A) of the Constitution. Value of goods and value of services are required to be segregated and service tax cannot be levied on value of goods. Only those sales which are established as pure sales of goods, supported by documentary evidence such as invoices, stock records and separate accounting, would be eligible for exclusion from taxable value. Since necessary factual details and supporting documents are not readily available on record, it is unable to quantify exact extent of exclusion at this stage. Demand to extent it includes value of pure sale of goods not relatable to landscaping and maintenance contracts is unsustainable. For purpose of limited verification and re-computation, issue is remanded to Adjudicating Authority, who shall examine the documentary evidence produced by Appellant, verify either sales are independent of service contracts and allow appropriate relief and re-compute demand in accordance with law. rnrnIssue 4: Service Tax – Rendering of services to special economic zone – Denial of exemption – Whether services rendered by Appellant to SEZ units are exempt from payment of Service Tax – HELD – Merely because recipient happens to be an SEZ unit does not render all services rendered to it exempt. Appellant had failed to establish that landscaping and garden maintenance services rendered to SEZ units were approved as authorised operations under SEZ Act. Appellant had not demonstrated compliance with mandatory procedural requirements prescribed under SEZ Act and relevant service tax exemption notifications. In absence of such compliance, exemption under Section 26 of SEZ Act cannot be extended. Services rendered by Appellant to SEZ units are not exempt from payment of Service Tax.rnrnIssue 5: Service Tax – Invoking of extended period of limitation – Imposition of penalty – Whether invocation of extended period and imposition of interest & penalties are sustainable – HELD – Proviso to Section 73(1) of the Act permits invocation of extended period, where non-payment of tax is by reason of fraud, collusion, wilful misstatement, suppression of facts or contravention of statutory provisions with intent to evade tax. Although Appellant was registered under one taxable category, they did not declare impugned activities and did not discharge tax under appropriate category of Management, Maintenance or Repair Service. Appellant did not file ST-3 returns reflecting consideration received under contracts. Mere availability of information in books of accounts, contracts or invoices would not amount to disclosure unless same is specifically declared in statutory returns. Extended period has been correctly invoked. Once tax liability is upheld, interest follows automatically. There is no infirmity in imposition of penalties, as Appellant had failed to comply with statutory obligations. Penalties imposed under Sections 77 and 78 of the Act are sustainable, subject to re-computation of tax liability after excluding value of sale of goods, as held above in this order. [Read less]

2026-VIL-100-CESTAT-DEL-ST | CESTAT SERVICE TAX

Service Tax - Cenvat credit fraud, fictitious firms, time-barred demand – Respondents availed Cenvat credit on input service invoices issued by companies that were found to be fictitious entities - The Income Tax department's investigation revealed that these companies were used to generate bogus invoices with fictitious bank accounts and employees acting as proxies. The respondent was unable to prove the genuineness of the input services or the payment of service tax to the government. A demand was raised for recovery of the Cenvat credit along with interest and penalties - Whether the demand relating to the period from... [Read more]

2026-VIL-45-CAL | High Court SGST

GST – Service of Notice, Denial of natural justice, Unreasoned order - The notice of show cause was served by way of uploading on the GST e-portal under the "Additional Notices and Orders" tab, depriving the petitioner of an opportunity to respond - Whether the dismissal of the petitioner's appeal by the Appellate Authority on the ground of delay was justified, given the fact that the petitioner had missed the notice of the adjudication order - HELD - The Appellate Authority had not conclusively established that the notification of the adjudication order was sent to the petitioner through SMS and email, as claimed. The m... [Read more]

2026-VIL-46-CAL | High Court SGST

GST – Availment of excess ITC on import of goods, Liability of the petitioners to reverse ITC for the failure of the petitioners’ suppliers to file returns – HELD - The petitioners were not liable for excess ITC availment on import of goods, as the non-reflection of IGST in the GST portal was not due to non-payment by the petitioners, but due to a procedural limitation arising from manual filing and processing of the bills of entry and the absence of system-recorded "Out of Charge" in ICES – Matter is remanded back to the appellate authority to reconsider the issue in light of the reports filed by the Customs autho... [Read more]

2026-VIL-105-CESTAT-CHE-CE | CESTAT CENTRAL EXCISE

Central Excise - Rules 2(a) and 4(5)(a) of Cenvat Credit Rules, 2004 – Eligibility to Cenvat credit on 'Kink Bending Machine'– Appellant is engaged in manufacture of Trucks and Commercial Vehicles and their parts and accessories – Appellant had availed CENVAT credit on Kink Bending Machine without receipt of goods into factory premises – Department issued show cause notice to Appellant by proposing recovery of said credit – Adjudicating Authority dropped proceedings initiated in notice – On appeal filed by department, First Appellate Authority set aside order passed by Adjudicating Authority – Whether Appella... [Read more]

2026-VIL-108-CESTAT-KOL-ST | CESTAT SERVICE TAX

Service Tax – Section 65(105) of Finance Act, 1994 – Demand of tax – Demand of Service Tax and also recovery of CENVAT Credit along with interest – Whether demand confirmed in impugned order against Appellant is sustainable – HELD – Main contention of Appellant is that show cause notice had not specified as to under which taxable category Service Tax is being demanded. Demand had been raised simply on basis of difference between Profit & Loss Accounts, Trial Balance and ST-3 Returns. It was necessary for Department to establish that alleged differential income pertained to rendering of taxable services falling ... [Read more]

2026-VIL-110-CESTAT-KOL-ST | CESTAT SERVICE TAX

Service Tax – Section 77(1)(a) of Finance Act, 1994 – Textile processing – Entitlement of exemption – Appellant is engaged in providing various taxable services – Department issued show cause notice to Appellant by proposing demand of Service Tax under various categories – Principal Commissioner confirmed demands proposed in show cause notice – Whether demand confirmed under category of Business Support Service is sustainable – HELD – The activity of processing of textiles undertaken by Appellant had been categorized as an activity liable to Service Tax under category of Business Support Service. Notification No.14/2004-ST specifically exempts activity of textile processing from levy of Service Tax. Activity of textile processing undertaken by Appellant is not liable to Service Tax. Demand confirmed under category of Business Support Service is legally not sustainable and hence, it is set aside – The appeal is disposed ofrnrnIssue 2: Service Tax – Renting of immovable property – Tax liability – Whether Appellant is liable to pay Service Tax in respect of renting of immovable property and renting of machinery services – HELD – Appellant had not declared these services rendered by them specifically either in balance sheet or in Income Tax Returns filed by them. Appellant is liable to pay Service Tax in respect of rendering of these services. Appellant had questioned computation of their Service Tax liability in respect of renting of immovable property and renting of machinery services and have made various submissions to this extent. Considering these submissions, for purpose of re-quantification of Service Tax demand in respect of these services, matter is remanded to Adjudicating authority. rnrnIssue 3: Service Tax – Goods transport agency service – Demand of tax – Whether demand confirmed against Appellant in impugned order under category of ‘goods transport agency service’ is sustainable – HELD – Appellant had actually received CHA services from their service providers. Documentary evidence submitted by Appellant clearly indicates that services received by Appellant are from CHA and there is no evidence of receipt of goods transport agency services. Demand confirmed against Appellant in impugned order under category of ‘goods transport agency service’ is set aside.rnrnIssue 4: Service Tax – Imposition of penalty – Whether penalty imposed on Appellant under Section 77(1)(a) of the Act is sustainable – HELD – Section 77(1)(a) of the Act imposes a penalty on any person liable to pay service tax who fails to take required registration. As Appellant is liable to pay Service Tax on renting of immovable property and renting of machinery services and had not taken registration for said services, penalty imposed on Appellant under Section 77(1)(a) of the Act is uphold. [Read less]

2026-VIL-102-CESTAT-CHE-ST | CESTAT SERVICE TAX

Service Tax – Section 26 of Special Economic Zones Act, 2005 – Payment of tax – Eligibility for refund – Appellant had filed refund claims under Notification No.9/2009-ST by claiming refund of service tax paid on services utilized by them – Adjudicating Authority rejected part of refund claim – Commissioner (Appeals) rejected appeal filed by Appellant – Whether denial of partial refund claim by Adjudicating Authority as upheld in impugned order, is in order – HELD – SEZ Act is a special legislation provides for exemption and manner of claiming refund. Section 26 of the Act is the governing provision which... [Read more]

2026-VIL-86-CESTAT-DEL-CE | CESTAT CENTRAL EXCISE

Central Excise – Manufacture of pan masala – Allegation of clandestine clearance – Demand of duty – Appellant is engaged in business of manufacture and sale of Pan Masala – Department received intelligence to effect that Appellant had clandestinely removed manufactured goods without cover of invoice and without payment of appropriate duty – After investigation, department issued show cause notice to Appellant by proposing demand of central excise duty – Principal Commissioner confirmed demand proposed in show cause notice – Whether department has established charge of clandestine clearance of goods against ... [Read more]

2026-VIL-48-CAL | High Court SGST

GST – Seizure of consignment of areca nuts, perishable goods, ownership dispute - Appellant is the owner of the consignment of areca nuts which were being transported. The goods were intercepted and seized by the respondent authorities. The appellant claimed ownership of the seized goods and was issued a show-cause notice assessing the penalty liability of the owner of the goods. The appellant filed a writ petition challenging the seizure and sought the release of the perishable goods - Whether the appellant is the rightful owner of the seized consignment of goods - HELD - There is no material to suggest that the claim o... [Read more]

2026-VIL-50-P&H | High Court VAT

Haryana General Sales Tax Act, 1973 - Tax concessions, Rule 28C of Haryana General Sales Tax Rules, 1975, “units in pipeline” – Challenge to denial of tax concessions under Rule 28C of the Haryana General Sales Tax Rules, 1975 - The petitioners had expanded or diversified their existing industrial units and applied for the tax concessions, but their applications were rejected on the ground that they did not fulfill the eligibility conditions, particularly the requirement of having the IEM registration on or before the cut-off date of 30.04.2000 - Whether the petitioners were entitled to the tax concessions under Rule 28C of the Haryana General Sales Tax Rules, 1975 as "units in pipeline" - HELD - The petitioners were not entitled to the tax concessions under Rule 28C as they did not fulfill the eligibility criteria to be considered "units in pipeline". As per the Rules, the "eligible industrial unit" for availing the tax concessions had to have the IEM registration on or before the cut-off date of 30.04.2000. However, in all the cases, the petitioners had obtained the IEM registrations for their expanded/diversified units either after the cut-off date or did not have the required IEM registration on the cut-off date. The subsequent IEM registrations cannot be deemed to relate back to petitioner’s earlier IEM registrations for the original units. Since the tax concessions were sought specifically for the expanded/diversified capacities, the requirement of having the IEM registration for the expanded/diversified unit on the cut-off date cannot be waived. The other eligibility conditions like having land/premises arranged, having applied for finances, and commencing production within 2 years were also not fulfilled by the petitioners - The respondents had correctly denied the tax concessions to the petitioners as they did not meet the eligibility criteria prescribed under Rule 28C of the Haryana General Sales Tax Rules, 1975 for being considered "units in pipeline" – The petitions are dismissed [Read less]

2026-VIL-101-CESTAT-KOL-ST | CESTAT SERVICE TAX

Service Tax – Renting of immovable property service – Invoking of extended period of limitation – Demand of tax – On basis of audit conducted on books of accounts of Appellant, department issued show cause notice to Appellant by proposing demand of Service Tax under various categories – Commissioner confirmed demands proposed in show cause notice – Whether demand of service tax confirmed under category of Renting of Immovable Property Service is sustainable – HELD – Demand had been raised by invoking extended period of limitation. Since there is no suppression of fact with intention to evade tax, demand confirmed for extended period of limitation cannot be sustained. Balance demand falling within normal period of limitation is confirmed – Appeal disposed of - Foreign currency expenses – Tax liability – Whether foreign currency expenses are liable for Service Tax under Reverse Charge Mechanism (RCM) – HELD – Demand had been confirmed under RCM on basis of difference in foreign currency expenses as shown in books of accounts vis-à-vis Service Tax Returns. Department had not brought in any evidence to substantiate allegation that said foreign currency expenses were incurred in relation to any taxable service, therefore, said expenses were not liable for Service Tax under RCM. Demand confirmed on foreign expenses is not sustainable - Payment of commission – Sustainability of demand – Whether Appellant is liable to pay Service Tax on commission expenses paid for selling tea outside India – HELD – Services towards selling tea (being agricultural produce) is wholly exempted from payment of service tax under Notification No.13/2003. Commissioner had confirmed demand on ground that aforesaid notification exempting services for selling on tea is applicable only in India and not in respect of import of services. Commissioner did not dispute the nature of services received by Appellant from outside India. Notification exempts services pertaining to sale of tea either provided within India or outside India, inasmuch as, no exclusion has been carved out to restrict exemption benefit for services rendered in India. Demand confirmed in impugned order on this count is set aside. [Read less]

2026-VIL-103-CESTAT-CHE-CU | CESTAT CUSTOMS

Customs – Import of goods – Rejection of declared classification – Demand of differential duty – Appellant had imported goods by classifying them as parts of Lifts/Escalators under CTH 8431 – Pursuant to an audit conducted, Department issued show cause notice proposing rejection of classification adopted by Appellant, reclassification under respective headings and demand of differential duty by invoking extended period of limitation – Adjudicating Authority confirmed proposals made in show cause notice – Whether Adjudicating Authority is justified in rejection of classification of imported goods as adopted by... [Read more]

2026-VIL-92-CESTAT-HYD-ST | CESTAT SERVICE TAX

Service Tax – Construction of hospital – Tax liability – Appellant is engaged in laying of roads and construction of public buildings – Appellant undertook construction works in capacity of contractor for Tirumala Tirupati Devasthanam (TTD) – Department issued show cause notice demanding payment of Service Tax under category of Works Contract Services – Adjudicating Authority confirmed demands under categories of Works Contract Service and Site Formation and Clearance service – Whether Appellant is liable to pay Service Tax on construction of hospital for TTD – HELD – Hospital building is not constructed ... [Read more]

2026-VIL-88-CESTAT-CHE-CE | CESTAT CENTRAL EXCISE

Central Excise – Rule 2(l) of CENVAT Credit Rules, 2004 – Recovery of credit – Appellant is engaged in manufacture of cement – Appellant availed CENVAT credit of service tax paid under reverse charge on GTA services used for outward transportation of cement from factory/depots to buyers’ premises – Department issued show cause notice proposing recovery of credit on ground that outward transportation beyond place of removal did not qualify as input service under Rule 2(l) of the Rules – Commissioner confirmed recovery of credit along with interest and penalty – Whether GTA services used for outward transport... [Read more]

2026-VIL-90-CESTAT-HYD-CU | CESTAT CUSTOMS

Customs – Import of manganese ores – Denial of exemption – Demand of duty – Appellants imported Manganese ores and claimed exemption from payment of Countervailing Duty in terms of S.No.4 of Notification No.04/2006-CE – Original Adjudicating Authorities confirmed demand of duty by denying exemption claimed by Appellants – Commissioners (Appeals) upheld orders passed by Original Adjudicating Authorities – Whether Appellants are entitled to benefit of exemption from payment of duty in terms of S.No.4 of Notification No.04/2006 – HELD – It is not in dispute that exemption notification specifically exempts �... [Read more]

2026-VIL-89-CESTAT-CHE-CU | CESTAT CUSTOMS

Customs – Re-import of goods – Eligibility for exemption – Appeal is filed against Order-in-Original, whereby Commissioner had confirmed demand of Customs duty comprising of Basic Customs Duty and Integrated Goods and Services Tax (IGST) in respect of re-import of certain goods – Whether re-import of goods is eligible for exemption under Notification No.45/2017 – HELD – Notification No.45/2017-Customs grants exemption from different components of Customs Duty. Controversy in this appeal primarily requires this Tribunal to examine statutory scheme governing levy of IGST on re-import of goods. Goods were moved by... [Read more]

2026-VIL-112-CESTAT-BLR-CE | CESTAT CENTRAL EXCISE

Central Excise – Rules 14 and 15(5) of CENVAT Credit Rules, 2004 – Demand of credit – Imposition of penalty – Appellant is engaged in manufacture of PVC pipes – Appellant entered into an agreement with KSRTC for operation of courier services through buses belonging to KSRTC and paid an amount as license fee including service tax to agency and availed same as CENVAT credit, which appears to be ineligible – Department issued show cause notice proposing demand of said irregular CENVAT credit availed by Appellant – Adjudicating authority confirmed demand of credit and imposed equal amount of penalty under Rule 15... [Read more]

2026-VIL-104-CESTAT-DEL-CU | CESTAT CUSTOMS

Customs – Sections 77, 111(d)(i) and 129A(1) of Customs Act, 1962 – Absolute confiscation of gold chain – Filing of appeal – Maintainability – Appellant arrived at Delhi from Bangkok by flight – Appellant was intercepted by officers after passing through the green channel and on examination, an unfinished gold chain was found in his bag – Assistant Commissioner ordered for absolute confiscation of gold chain under Section 111(d)(i) of the Act – Commissioner (Appeals) dismissed appeal filed by Appellant – Whether appeal filed by Appellant before this Tribunal against order passed by Commissioner (Appeals) ... [Read more]

2026-VIL-94-CESTAT-CHE-ST | CESTAT SERVICE TAX

Service Tax – Warehouse related services – Demand of tax – Appellant is engaged in manufacture of automative fasteners – During scrutiny of records, department found that Appellant had incurred expenses towards warehouse related services in USA and have also realized lease income for renting out their windmills to their group company – Department issued show cause notices proposing demand of Service Tax under various categories – Adjudicating Authority confirmed demands proposed in show cause notice – Appellate Authority upheld order passed by Adjudicating Authority – Whether demand of tax for services rendered by service providers in USA are exigible to tax at hands of Appellant under reverse charge mechanism – HELD – It is an admitted position that services provided to Appellant are rendered by service providers in USA and are received and consumed in said country. Proposal is to classify such services as Business Support Services. Logistics services are more appropriately classifiable under clearing and forwarding agency services. Orders impugned in appeals, which sustain the demand of service tax under Business Support Service on Appellant, are untenable and are liable to be set aside – Appeals allowed - Letting out of windmills – Tax liability – Whether income earned by letting out the windmills by Appellant is exigible to tax as renting of immovable property – HELD – Proposal in show cause notice itself is to treat windmills as a ‘factory’, since Appellant had considered these as assets in their books of accounts. Show cause notice is vague and had not put Appellant to notice as to why mere treatment of windmills as assets would warrant such windmills to be treated as a ‘factory’ and that it would tantamount to renting of immovable property. Surmise of Appellate authority that windmills are permanently embedded is without any evidence, especially when all along the Appellant’s contention has been that these are excisable goods which can be removed and re-erected at any other place, which is not seen disproved. Demand made on leasing of windmills, treating it as renting of immovable property, is untenable. [Read less]

2026-VIL-87-CESTAT-ALH-CE | CESTAT CENTRAL EXCISE

Central Excise – Section 14 of Central Excise Act, 1944 – Clandestine clearance of goods – Demand of duty – Appellant is engaged in production of Unmanufactured Branded Chewing Tobacco – Investigation revealed that Appellant had manufactured goods without making entries in respect of same in their statutory records and clearing same without payment of duty – Department issued show cause notice to Appellant by proposing demand of Basic Excise Duty – Adjudicating Authority confirmed demand proposed in show cause notice – Whether demand of duty confirmed against Appellant is sustainable – HELD – Question o... [Read more]

2026-VIL-93-CESTAT-ALH-ST | CESTAT SERVICE TAX

Service Tax – Sections 75 and 78 of Finance Act, 1994 – Invoking of extended period of limitation – Demand of tax – Appellant is engaged in providing various taxable services – On basis of third party information received from Income Tax Department, Revenue issued show cause notice proposing demand of Service Tax by invoking extended period of limitation – Adjudicating Authority confirmed demand proposed in show cause notice – Commissioner (Appeals) dismissed appeal filed by Appellant – Whether invoking of extended period of limitation is justified in facts and circumstances of case – HELD – On perusal ... [Read more]

2026-VIL-111-CESTAT-ALH-ST | CESTAT SERVICE TAX

Service Tax – Section 73(1) of Finance Act, 1994 – Invoking of extended period of limitation – Demand of tax – Appellant is engaged in providing Works Contract Services, but had not paid any service tax – Department issued show cause notice proposing demand of Service Tax, to Appellant, by invoking extended period of limitation – Joint Commissioner confirmed demand proposed in show cause notice – Commissioner (Appeals) upheld order passed by Joint Commissioner – Whether demand confirmed by invoking extended period of limitation as per proviso to Section 73(1) of the Act is sustainable – HELD – Appellant... [Read more]

2026-VIL-44-KER | High Court VAT

Kerala General Sales Tax Act, 1963 - Limitation Period for Assessments - The petitioner challenged various assessment orders passed against it under the KGST Act, 1963 on the ground of limitation – HELD - The original provisions of the Act did not provide any period of limitation, but the Finance Act, 1993 had introduced a limitation period of 4 years, later increased to 5 years. Applying this limitation period, the assessments in the present cases, where the pre-assessment notices were issued much beyond the 5-year period, were clearly time-barred - The State's arguments that the amendments made by the Finance Acts of 2... [Read more]

2026-VIL-91-CESTAT-MUM-CU | CESTAT CUSTOMS

Customs – Regulation 11 of Customs Broker Licensing Regulations, 2013 – Revocation of license – Forfeiture of security deposit – Imposition of penalty – On basis of offence report received from DRI, department issued show cause notice alleging that Appellants/Customs Broker (CB) have contravened provisions of Regulation 11(a), 11(d), 11(e), 11(m) and 11(n) of the Regulations – Upon completion of inquiry proceedings, Principal Commissioner revoked CB License of Appellants and forfeiture of entire amount of security deposit, besides imposition of penalty on Appellants – Whether Appellants have fulfilled all his obligations as required under the Regulations or not – HELD – Mis-use of advance authorization by importer was found by department only on basis of specific investigation conducted by DRI subsequent to clearance of imported goods from customs control. When customs authorities themselves had cleared imported goods and were not aware of any future non-compliance or violation by importer, there is no possibility for Appellants to be aware of same and to bring it to notice of Deputy Commissioner or Assistant Commissioner. Customs Broker is not an officer of Customs who would have an expertise to identify mis-declaration of goods. Appellants had admitted that they had not obtained authorization from importer. Appellants could have been proactive in fulfilling their obligation as Customs Broker in obtaining proper authorization in representing them in clearance of imported goods before Customs authorities. In view of failure of Appellants to have acted in a proactive manner in fulfillment of obligation under Regulation 11(a) of the Regulations, it is justifiable to impose a penalty against Appellants, which would be reasonable. Since there is no violation of Regulations 11(d), 11(e), 11(m) and 11(n) of the Regulations, impugned order passed by Principal Commissioner revoking license of Appellants and forfeiture of security deposit is set aside. Impugned order is modified to above extent – Appeal partly allowed [Read less]

2026-VIL-96-CESTAT-DEL-ST | CESTAT SERVICE TAX

Service Tax - Forfeiture of security deposits/earnest money, Liquidated damages – Appellant invoked bank guarantees, forfeited earnest money/performance securities, and levied penalties against contractors who failed to perform their contractual obligations in time - Dept confirmed demands of service tax on the consideration for 'tolerating the act' of service providers/contractors under Section 66E(e) of the Finance Act, 1994 - Whether the amounts collected by the appellant in the nature of forfeiture of security deposits/earnest money and fines/penalties, liquidated damages against delayed completion of works are chargeable to service tax under Section 66E(e) of the Finance Act, 1994 – HELD - The recovery of liquidated damages/penalty from the other party cannot be said to be towards any service, as neither the appellant is carrying on any activity to receive compensation nor can there be any intention of the other party to breach or violate the contract and suffer a loss. The purpose of imposing compensation or penalty is to ensure compliance with the contract terms, not to tolerate the defaulting act. For an activity to be covered as a declared service under Section 66E(e), there must be an independent agreement to refrain or tolerate or to do an act between the parties, along with a flow of consideration for this activity. In the present case, the amounts collected by the appellant have no nexus with the provision of any taxable service, and are in the nature of penal charges on account of breach or non-performance of contract, intended to make good for the losses and act as a deterrent. Thus, these amounts cannot be treated as 'consideration' for any service under Section 65B(44) of the Act - the amounts collected by the appellant in the nature of forfeiture of security deposits/earnest money and fines/penalties, liquidated damages are not chargeable to service tax under Section 66E(e) of the Finance Act, 1994 - The impugned order is set aside and the appeal is allowed [Read less]

2026-VIL-106-CESTAT-DEL-CU | CESTAT CUSTOMS

Customs – Customs Brokers Licensing Regulations, 2018 – Regulation 10 – Revocation of customs broker license – Forfeiture of security deposit – Additional Commissioner sent an investigation report to office of Commissioner for taking action against Appellant for violation of provisions of the Regulations – After following due process of law, Commissioner revoked Customs Broker License of Appellant and forfeited its whole amount of security deposit and also imposed penalty on Appellant – Whether Commissioner has erred in holding that Appellant had violated provisions of Regulations 10(a), 10(d) and 10(n) of th... [Read more]

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