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More Judgements

2019-VIL-239-CESTAT-AHM-CE  | CESTAT CENTRAL EXCISE

Central Excise - Appellant has entered into agreement with the OMCs for supply on Natural gas/ CNG on principal to principal basis - demand of duty on such “Trade Margin” on the ground that the ‘Trade Margin’ is compensation given by the Appellant to OMCs in lieu of facilities received by the Appellant – Department of the view that the Trade Margin is part and parcel of the assessable value and the same is required to be included in the assessable value for payment of duty – HELD - The agreement between the appellant and OMCs clearly shows that the trade margin were being decided at fixed level by the parties t... [Read more]

Central Excise - Appellant has entered into agreement with the OMCs for supply on Natural gas/ CNG on principal to principal basis - demand of duty on such “Trade Margin” on the ground that the ‘Trade Margin’ is compensation given by the Appellant to OMCs in lieu of facilities received by the Appellant – Department of the view that the Trade Margin is part and parcel of the assessable value and the same is required to be included in the assessable value for payment of duty – HELD - The agreement between the appellant and OMCs clearly shows that the trade margin were being decided at fixed level by the parties to such agreement. In terms of the agreement, OMCs are not entitled to any remuneration or compensation of any nature whatsoever for installing equipment and other facilities at the site of the OMC. The Trade Margin is decided after considering the costs and expenses incurred by OMCs including their profits. The above terms of the agreement clearly show that the transaction between the appellant and the OMCs is at arms length and cannot be doubted. Hence the Trade Margin cannot be included in the assessable value at the Appellant’s end and hence the demand raised against the Appellant on Trade margin is not sustainable - the Revenue has not produced any evidence to show that there is any kind of direct or indirect consideration paid by the OMCs to the Appellant. It is also a fact that the OMCs are Public Undertakings and therefore, there is no iota of doubt that the transaction between the parties is the sole consideration and at arm’s length - the demand on ‘Trade Margin’ confirmed against the Appellant is not sustainable and same is set aside - Appellant were disclosing the methodology of valuation and the Revenue never pointed out any irregularity. In such case, the bona fide of the appellant cannot be doubted. Since there is no ingredient of any malafide intention on the part of the Appellant to evade the excise duty, the extended period cannot be invoked for raising demand - the impugned order is set aside by allowing the appeal [Read less]

2019-VIL-236-CESTAT-HYD-CE  | CESTAT CENTRAL EXCISE

Central Excise - whether the assessee is entitled to CENVAT credit on sugar cess as the same is not one of the duties allowed for CENVAT credit under Rule 3(1) of the CENVAT Credit Rules, 2004 - binding precedent of High Court judgment even though disagreeing with the view – HELD - per Rule 3 of CCR, 2004, CENVAT credit is not permissible on everything which has been paid but only such duties as are specified in it - cess is deemed to be a duty of excise under Central Excise Act and correspondingly all provisions of the Central Excise Act will apply. A plain reading of Rule 3 would show that all cesses have not been made... [Read more]

Central Excise - whether the assessee is entitled to CENVAT credit on sugar cess as the same is not one of the duties allowed for CENVAT credit under Rule 3(1) of the CENVAT Credit Rules, 2004 - binding precedent of High Court judgment even though disagreeing with the view – HELD - per Rule 3 of CCR, 2004, CENVAT credit is not permissible on everything which has been paid but only such duties as are specified in it - cess is deemed to be a duty of excise under Central Excise Act and correspondingly all provisions of the Central Excise Act will apply. A plain reading of Rule 3 would show that all cesses have not been made eligible for CENVAT credit but only duties of excise or additional duties of excise or education cess etc., have been made eligible for CENVAT credit. Sugar cess is clearly not covered in Rule 3 of CCR, 2004. However, the Hon’ble High Court of Karnataka has allowed CENVAT credit on sugar cess which leaves with no option but to follow this judgment while most respectfully disagreeing with it - The specific question of whether CENVAT credit is admissible on sugar cess paid on imported sugar was addressed only by the Hon’ble High Court of Karnataka. Respectfully following the ratio, the appellant is entitled to CENVAT credit on the sugar cess paid on the imported sugar - The appeal is allowed and the impugned order is set aside [Read less]

2019-VIL-237-CESTAT-MUM-CU  | CESTAT Case CUSTOMS

Customs - appellant imported the main component and other parts, excluding ‘power supply’ and ‘base’, of ‘electric iron’– revenue view that the excluded parts were imported separately with intent to evade compliance with the norms of the BIS - the appellant contends that the test of compliance with standards under another law cannot extend to parts of goods merely because the General Interpretative Rules in Customs Tariff Act, 1975 enables such wider prism for classification – HELD – the impugned goods, upon examination and not by the mere reliance on legal fiction in the interpretative rules, were found ... [Read more]

Customs - appellant imported the main component and other parts, excluding ‘power supply’ and ‘base’, of ‘electric iron’– revenue view that the excluded parts were imported separately with intent to evade compliance with the norms of the BIS - the appellant contends that the test of compliance with standards under another law cannot extend to parts of goods merely because the General Interpretative Rules in Customs Tariff Act, 1975 enables such wider prism for classification – HELD – the impugned goods, upon examination and not by the mere reliance on legal fiction in the interpretative rules, were found to be the most vital component of ‘electric iron’ and that the goods were so packed as to easily integrate the other two parts which had been imported separately but concurrently, to support the finding that the goods are, indeed, ‘electric iron.’ Although the prescriptions of BIS applies to the finished product and not to the parts but the most essential component that is impugned in this dispute, if allowed to remain non-compliant, would not be conducive to public safety - It was incumbent on the appellant to obtain necessary certification before affecting the imports. In these circumstances, no merit in the appellant’s submission that the goods are not liable to confiscation and that the prescription in, and requirement to, comply with the Foreign Trade Policy can be ignored - As the imported goods, though required to be, are not compliant with the standards, they fail to overcome the bar of prohibition at the threshold. Hence the question of differential duty liability, will not arise. However, failure to comply with the norms prescribed by BIS would render the goods liable to confiscation - while upholding the liability of the goods to confiscation, the confiscation is set aside. The goods, being prohibited for import, same be re-exported – since re-export is not without any financial consequence to the importer, the penalty imposed under section 112 is set aside - the impugned order is modified and limit the detriment to that of re-export of the said goods without having to redeem the goods and without being penalised - The appeal is disposed off [Read less]

2019-VIL-234-CESTAT-BLR-ST  | CESTAT SERVICE TAX

Service Tax - whether the refund claims are hit by time bar when they examined with regard to Section 11B of the CEA, 1944 - whether the registration of the premises of the respondent is mandatory before carrying out the export of service – HELD - the refund claims are required to be filed within the period of one year specified in Section 11B, however, the period of one year is to be considered as extended to the end of the quarter in which such claims are made. When the refund claims in question are examined with reference to the above, we find that all the claims are filed within time - When there is no dispute about ... [Read more]

Service Tax - whether the refund claims are hit by time bar when they examined with regard to Section 11B of the CEA, 1944 - whether the registration of the premises of the respondent is mandatory before carrying out the export of service – HELD - the refund claims are required to be filed within the period of one year specified in Section 11B, however, the period of one year is to be considered as extended to the end of the quarter in which such claims are made. When the refund claims in question are examined with reference to the above, we find that all the claims are filed within time - When there is no dispute about the factum of export of service as well as the receipt of foreign exchange for such export, the claim for refund pertains to the period prior to obtaining the registration for premises of the respondent cannot be held against the assessee - appeal filed by the Revenue is rejected [Read less]

2019-VIL-240-CESTAT-BLR-ST  | CESTAT SERVICE TAX

Service Tax – Cenvat Credit on input services - repair service of car – HELD - repair service of the car which is used to ferry the employees inside the factory and also used for material for work-in-progress, is eligible as the same is indirectly related to the manufacture. Similarly the repair of the MD car is also in connection with the manufacture of the final product and is eligible. Further with regard to other services viz. photography for ground breaking function, hiring charges and cleaning and debris removal fall in the definition of ‘input service as the same is directly or indirectly related to the manufa... [Read more]

Service Tax – Cenvat Credit on input services - repair service of car – HELD - repair service of the car which is used to ferry the employees inside the factory and also used for material for work-in-progress, is eligible as the same is indirectly related to the manufacture. Similarly the repair of the MD car is also in connection with the manufacture of the final product and is eligible. Further with regard to other services viz. photography for ground breaking function, hiring charges and cleaning and debris removal fall in the definition of ‘input service as the same is directly or indirectly related to the manufacture of the final product and thereby fall in the definition of ‘input service - except rent-a-cab on which the appellant has not pressed for cenvat credit, other services fall in the definition of ‘input service’ and the appellant is entitled to cenvat credit of the same - the appeal is partly allowed [Read less]

2019-VIL-19-NAA  | National Anti/Profiteering Authority SGST

GST - National Anti-Profiteering Authority - profiteering on the supply of ‘Snacks’, by not passing on the benefit of reduction in the rate of tax from 12% to 5% w.e.f. 15.11.2017 – supply of products under Brand Name – HELD - the Respondent was charging GST @ 12% as per the Notification dated 28.06.2017 on the supply of his products covered under HSN Code 21069099 which were put up in the unit containers and was also using the unregistered brand name – HELD - respondent had placed on record before the Commissioner claiming that he was voluntarily foregoing his actionable claim or enforceable rights on his brand ... [Read more]

GST - National Anti-Profiteering Authority - profiteering on the supply of ‘Snacks’, by not passing on the benefit of reduction in the rate of tax from 12% to 5% w.e.f. 15.11.2017 – supply of products under Brand Name – HELD - the Respondent was charging GST @ 12% as per the Notification dated 28.06.2017 on the supply of his products covered under HSN Code 21069099 which were put up in the unit containers and was also using the unregistered brand name – HELD - respondent had placed on record before the Commissioner claiming that he was voluntarily foregoing his actionable claim or enforceable rights on his brand name. Therefore, it is clear that w.e.f. 24.11.2017 the rate of tax on the products being sold by the Respondent had become nil. It is also evident that the Respondent had started charging GST @ 5% from his customers w.e.f. 27.11.2017 as per the Notification dated 13.10.2017 – it is also evident that the Respondent had got his brand name registered on 29.12.2017 and had started correctly charging GST @ 12% as per the Notification 13.10.2017 w.e.f. 01 01.2018. Therefore, it is established that the Respondent had wrongly charged GST @ 5% from his buyers w.e.f. 27.11.2017 to 31.12.2017 and had thus denied them the benefit of tax reduction as per the provisions of Section 171(1) of the Act - The consumers can not be allowed to be denied the benefit of tax reduction, granted by both the Central and the State Govt. out of their own tax revenue, due to the ignorance of the Respondent - Moreover the claim that it was difficult to alter the MRPs printed on the packets also does not hold good as the Government has outlined the procedure for changing the MRPs after reduction in the tax rate - The commensurate benefit of tax reduction was required to be passed on by the respondent by reducing his prices irrespective of the any other factors, which he had failed to do - the Respondent has acted in contravention of the provisions of Section 171(1) of the CGST Act, 2017 and has not passed on the benefit of reduction in the rate of tax to his recipients by commensurate reduction in the prices - keeping in view the principles of natural justice a fresh notice be issued before imposition of penalty [Read less]

2019-VIL-163-DEL  | High Court SGST

CLIX CAPITAL SERVICES PRIVATE LIMITED Vs UNION OF INDIA: 27.03.2019 - GST - Penalty for late filing of Form GSTR-3B – HELD – given the fact that the system problem arose on account of design limitation, the respondents-authorities should not enforce any demand, penalty, interest or late submission fee - Late fee, if any, paid by the petitioner, shall be refunded to the petitioner

2019-VIL-165-GUJ  | High Court SGST

GST - Rule 93 of CGST Rules, 2017 - Credit of the amount of rejected refund claim - refund of unutilised input tax credit - whether the petitioner is entitled to re-credit of the amount of Refund amount on the basis of Form GST RFD-PMT 03 issued by the respondents-Authority in its Electronic Credit Ledger – HELD - In terms of Explanation to Sub-rule (2) of rule 93 a refund shall be deemed to be rejected, if the appeal is finally rejected or if the claimant gives an undertaking in writing to the proper officer that he shall not file an appeal - In the present case, the amount has not been re-credited not on account of non... [Read more]

GST - Rule 93 of CGST Rules, 2017 - Credit of the amount of rejected refund claim - refund of unutilised input tax credit - whether the petitioner is entitled to re-credit of the amount of Refund amount on the basis of Form GST RFD-PMT 03 issued by the respondents-Authority in its Electronic Credit Ledger – HELD - In terms of Explanation to Sub-rule (2) of rule 93 a refund shall be deemed to be rejected, if the appeal is finally rejected or if the claimant gives an undertaking in writing to the proper officer that he shall not file an appeal - In the present case, the amount has not been re-credited not on account of non compliance with the provisions of the Explanation to rule 93 of the CGST Rules, but since there is no mechanism for re-crediting the amount to the Electronic Credit Ledger. In either case, the petitioner is entitled to the alternative relief prayed for in the petition - The Respondent-Assistant Commissioner is hereby directed to re-credit the Refund amount to the Electronic Credit Ledger on the basis of Form GST RFD-PMT 03. To comply with the provisions of the Explanation to rule 93 of the CG&ST Rules, the petitioner shall file an undertaking as required. In case, it is not possible to re-credit the amount to the Electronic Credit Ledger, the petitioner shall be permitted to manually take credit of the said amount - the petition succeeds and is accordingly allowed [Read less]

2019-VIL-232-CESTAT-DEL-ST  | CESTAT SERVICE TAX

Service Tax - supply of power plant equipment - Service rendered for Indian port of entry handling and inland transportation - The Department of the view that the appellant had incorrectly discharged Service Tax under the category of Goods Transport Services whereas, it was actually rendering Cargo Handling Service, therefore, the appellant had short paid the Service Tax – HELD - composite service may include various intermediary and ancillary services such as loading/unloading, packing/unpacking etc. provided in the course of transportation of goods by road. These services are not provided as independent activity but as... [Read more]

Service Tax - supply of power plant equipment - Service rendered for Indian port of entry handling and inland transportation - The Department of the view that the appellant had incorrectly discharged Service Tax under the category of Goods Transport Services whereas, it was actually rendering Cargo Handling Service, therefore, the appellant had short paid the Service Tax – HELD - composite service may include various intermediary and ancillary services such as loading/unloading, packing/unpacking etc. provided in the course of transportation of goods by road. These services are not provided as independent activity but as means of successful implementation of the principal service, namely the transportation of goods by road. Therefore, a composite service even if it consists of more than one service, should be treated as a single service based on the main or principal service. Thus, any ancillary/intermediate service provided in relation to transportation of goods, and the charges, if any, for such services are included in the invoice issued by the Goods and Transport Agency and not by any other person. Such service would form part of Goods and Transport Agency Service – further, ‘Taxable Service’ under Section 65(105)(zr) is a service provided or to be provided to any person by Cargo Handling Agency in relation to ‘Cargo Handling Services’. The Appellant is neither a Cargo Handling Agency nor is it the case set up by the Department in the SCN that it is a Cargo Handing Agency. Thus, it is more than apparent that the Appellant is not rendering “Cargo Handling Services” - the impugned order is set aside and the appeal is allowed [Read less]

2019-VIL-233-CESTAT-DEL-CU  | CESTAT Case CUSTOMS

Customs - appellant imported certain press dies declaring them as press dies for manufacturing of the particular part of the press machine and declared classification under chapter heading 84 – SCN by invoking extended period of limitation to re-classify the goods under Chapter 8207 of the Customs Tariff Act, 1975 – demand for differential duty – HELD - before 18.04.2011 the goods were examined and allowed to be cleared, classifying the goods under Chapter 84 of the tariff Act - after 18.04.2011 also bills of entry were examined and cleared for home consumption by classifying the same under Chapter 84 of the Tariff A... [Read more]

Customs - appellant imported certain press dies declaring them as press dies for manufacturing of the particular part of the press machine and declared classification under chapter heading 84 – SCN by invoking extended period of limitation to re-classify the goods under Chapter 8207 of the Customs Tariff Act, 1975 – demand for differential duty – HELD - before 18.04.2011 the goods were examined and allowed to be cleared, classifying the goods under Chapter 84 of the tariff Act - after 18.04.2011 also bills of entry were examined and cleared for home consumption by classifying the same under Chapter 84 of the Tariff Act. It means, both Revenue as well as the appellant were having the understanding that classification assessed prior to 18.04.2011 was correct at the time of clearance of the bills of entry in question. Further, the show cause notice has been issued by invoking extended period of limitation - In such a situation, the bonafides of the appellants have been proved and it is not a case of suppression of classification by the appellant - when the appellant sought classification under chapter 84 of the Act, it is the duty of the adjudicating authority to classify correctly and to examine whether the classification sought is correct or not? Admittedly, the goods were classified under Chapter 84 of the Act. Therefore, proviso to Section 28 of Customs Act, 1962 are not invokable, to invite extended period of limitation in the facts of this case – demand and penalty set aside and appeal is allowed [Read less]

2019-VIL-231-CESTAT-CHE-CE  | CESTAT CENTRAL EXCISE

Central Excise - appellants are manufacturers of cakes and food items and were clearing the same after availing SSI exemption under Notification No.8/2003-CE as amended – denial of SSI exemption Notification No.8/2002-CE and 8/2003-CE. SCN proposing penalty on the ground of suppression with intention to evade payment of Central Excise duty – HELD – appellants were continuously reiterating with the department, at least from 2002, that they were eligible to claim small scale exemption. In the circumstances, employee of the appellant cannot then be saddled with such charge and penalty imposed under Rule 26 - an earlier ... [Read more]

Central Excise - appellants are manufacturers of cakes and food items and were clearing the same after availing SSI exemption under Notification No.8/2003-CE as amended – denial of SSI exemption Notification No.8/2002-CE and 8/2003-CE. SCN proposing penalty on the ground of suppression with intention to evade payment of Central Excise duty – HELD – appellants were continuously reiterating with the department, at least from 2002, that they were eligible to claim small scale exemption. In the circumstances, employee of the appellant cannot then be saddled with such charge and penalty imposed under Rule 26 - an earlier SCN seeking to deny the exemption had been set aside by the Commissioner (Appeals). This being so, subsequent SCN proposing similar denial of SSI exemption should have been issued for the normal period of one year instead of invoking extended period of limitation as has been done in this case. It follows that there cannot be any ingredients present for imposition of penalty under Section 11AC - the impugned demand cannot sustained on the grounds of limitation and set aside – the appeals are allowed [Read less]

2019-VIL-161-KER  | High Court SGST

GST – functions of GST Council - Validity of single judge Order directing the GST Council to consider the representations of Respondent-Plastic Recycling Industrial Association and pass orders thereon, after conducting personal hearing – representation to GST Council for withdrawing levy of tax on the recycled plastic products – HELD - On a perusal of provisions of Article 279A of the Constitution, it is evident that there is no mechanism provided in the Constitution or any other statute for the GST Council to adjudicate the grievances raised by the general public. There is no mechanism for consideration and disposal... [Read more]

GST – functions of GST Council - Validity of single judge Order directing the GST Council to consider the representations of Respondent-Plastic Recycling Industrial Association and pass orders thereon, after conducting personal hearing – representation to GST Council for withdrawing levy of tax on the recycled plastic products – HELD - On a perusal of provisions of Article 279A of the Constitution, it is evident that there is no mechanism provided in the Constitution or any other statute for the GST Council to adjudicate the grievances raised by the general public. There is no mechanism for consideration and disposal of representations made by the general public to the Council after conducting personal hearing of the parties who make such representations - the GST Council is a constitutional body and its functions and duties are clearly mentioned in the Constitution. It is not the function of the GST Council to receive representations from the general public and to conduct personal hearings and to pass orders on such representations or to adjudicate on the grievances raised by the members of the general public with regard to imposition and levy of goods and services tax on any product – the learned Single Judge has wrongly exercised his discretion in issuing a direction to the Goods and Services Tax Council to consider representation and pass orders thereon, after conducting personal hearing - the impugned judgment is set aside and the writ appeal is allowed [Read less]

2019-VIL-160-MAD  | High Court VAT

Pondicherry General Sales Tax Act - whether the appellants can claim exemption under the provisions of the Pondicherry General Sales Tax Act exempting the tax payable under the said Act on the turnover from the sales of goods manufactured by them in their industry located in the Union Territory of Pondicherry – denial of benefit of exemption notification in G.O.Ms.No.35/99/F.2 dated 30.03.1999 and SCN proposing to reject the claim for exemption and assess the entire turnover to tax under the PGST Act – HELD - the appellant to be entitled for the benefit of proviso should have obtained any license before 1st April 1999 ... [Read more]

Pondicherry General Sales Tax Act - whether the appellants can claim exemption under the provisions of the Pondicherry General Sales Tax Act exempting the tax payable under the said Act on the turnover from the sales of goods manufactured by them in their industry located in the Union Territory of Pondicherry – denial of benefit of exemption notification in G.O.Ms.No.35/99/F.2 dated 30.03.1999 and SCN proposing to reject the claim for exemption and assess the entire turnover to tax under the PGST Act – HELD - the appellant to be entitled for the benefit of proviso should have obtained any license before 1st April 1999 - the provisional certificate issued by the Directorate of Industries, Government of Pondicherry is a provisional registration certificate registering the appellant as a small scale undertaking unit. This certificate is to enable the appellant to obtain all clearances/facilities for its setting. The certificate clearly states that no production should be started before obtaining necessary clearances and it is granted without any guarantee for availability of any raw material and such other matters. Therefore, to term such a certificate as a license as required to be obtained in terms of the proviso in G.O.Ms.No. 35/99/F.2 dated 30.03.1999 is an argument which is stated to be rejected. Therefore, the learned Single Bench was fully right in rejecting the contentions raised by the appellant by arguing that they qualify for exemption in terms of the Proviso - the correct manner to interpret the exemption notification is to hold that with effect from 01.04.1999 a new industry commencing production of Indian Made Foreign Liquor is not entitled for any exemption from payment of sales tax - the appellant having not started production within two years from 21.07.2000 is not entitled to any benefit - the writ appeals and the writ petitions are dismissed [Read less]

2019-VIL-162-GAU  | High Court VAT

Assam Entry Tax Act – whether the amount of VAT paid for the purchase of crude oil is includible in computation entry tax - petitioner grievance that assessment order which included the VAT paid on the purchase of crude oil also as a component to collect the entry tax payable – HELD - the entry tax is chargeable on the value to be determined on entry of the goods into the local area does not determine the components that are to be taken into consideration for determining the value at the time of entry into local area - the point of delivery in the local area will have to be considered as the entry of goods to the local... [Read more]

Assam Entry Tax Act – whether the amount of VAT paid for the purchase of crude oil is includible in computation entry tax - petitioner grievance that assessment order which included the VAT paid on the purchase of crude oil also as a component to collect the entry tax payable – HELD - the entry tax is chargeable on the value to be determined on entry of the goods into the local area does not determine the components that are to be taken into consideration for determining the value at the time of entry into local area - the point of delivery in the local area will have to be considered as the entry of goods to the local area. If that be the position, even if the contention that the processing is to be done at the refinery and only thereafter VAT would be payable, the same is also incidental to the purchase, irrespective of the fact as to whether the same is included in the invoice or not it would get attracted. The value of the VAT also would, therefore, get included in the import value for the purpose of processing the entry tax as it would fall under “other charges incidentally levied on the purchase of such goods” which is paid or payable - the payment of VAT is incidental to the purchase of goods and would fall under the “other charges” and includible for the purpose of levy of entry tax – The petition is dismissed [Read less]

2019-VIL-228-CESTAT-CHE-CE  | CESTAT CENTRAL EXCISE

Central Excise - Allegation of clandestine removal with the view that assessee did not get manufactured the fabrics and instead diverted the yarn in the market – Duty demand duty on the ground that either the job workers did not have facility to manufacture or were not existing – HELD - only on the ground that some job workers could not be found or that some of them refused to have done job work, it cannot be concluded that no activity of job work manufacturing of fabrics was undertaken - the statement of few transporters that they did not transport the fabric cannot be a ground to hold that no fabric was manufactured ... [Read more]

Central Excise - Allegation of clandestine removal with the view that assessee did not get manufactured the fabrics and instead diverted the yarn in the market – Duty demand duty on the ground that either the job workers did not have facility to manufacture or were not existing – HELD - only on the ground that some job workers could not be found or that some of them refused to have done job work, it cannot be concluded that no activity of job work manufacturing of fabrics was undertaken - the statement of few transporters that they did not transport the fabric cannot be a ground to hold that no fabric was manufactured as the main job workers have accepted the manufacture of fabric on job work - There are no evidences that job work charges paid by the Appellant to the job workers flowed back to them. Even if some of the buyers of the fabrics could not be found, it cannot lead to the conclusion that the Appellant did not sell the fabrics to such parties. It is also not shown that if such fabric was not manufactured from the yarn in question then from what other source the Appellant procured yarn to manufacture the fabric. Further majority of job workers have accepted the job work manufacturing of the fabrics from the Yarn supplied by the appellant - it cannot be said that the Appellant did not get manufactured the fabrics and instead diverted the yarn in the market - the revenue could not produce any evidence of removal and sale of POY and hence the demand on alleged removal does not sustain – the impugned order is set aside and the appeal is allowed [Read less]

2019-VIL-164-BOM  | High Court VAT

Bombay Sales Tax Act, 1959 - whether the Tribunal was justified in not adjudicating the point relating to levy of tax on Exim Scrips merely because a ground in that regard was not mentioned in the second appeal or even raised in the first appellate proceedings – whether the Tribunal was justified in holding that plastic powder is not a chemical - interpretation of the provisions of Section 41 of the BST Act, read with Notification Entry 39 issued under Section 41 of the BST Act – HELD - the applicant never made any application for leading any additional evidence to substantiate its claim that the Exim Scrips were in fa... [Read more]

Bombay Sales Tax Act, 1959 - whether the Tribunal was justified in not adjudicating the point relating to levy of tax on Exim Scrips merely because a ground in that regard was not mentioned in the second appeal or even raised in the first appellate proceedings – whether the Tribunal was justified in holding that plastic powder is not a chemical - interpretation of the provisions of Section 41 of the BST Act, read with Notification Entry 39 issued under Section 41 of the BST Act – HELD - the applicant never made any application for leading any additional evidence to substantiate its claim that the Exim Scrips were in fact surrendered to the Government and were not sold - If the applicant did not bring any material before the Tribunal to substantiate its claim that it had surrendered the Exim Scrips to the Government and therefore was not exigible to tax, the Tribunal necessarily could not have entertained the aforesaid ground as there was no material brought on record to render a finding thereon - the MSTT was legally justified in not adjudicating on the point regarding levy of tax on Exim Scrips - the question is answered against the applicant and in favour of the revenue - It is obvious that P.P. powder used only as a raw material and therefore by no stretch of the imagination can be said to be a “chemical”. The plastic raw materials are not known for their chemical properties. There is a clear distinction between a chemical intermediary on the one hand and a chemical product used as a raw material directly for the manufacture of goods on the other - Unless the provisions of the BST Act provide otherwise, a particular Entry in the BST Act should normally be interpreted by applying the common parlance test. Once we hold this, we have no hesitation in agreeing with the findings given by Tribunal that P.P. powder cannot be termed as a “chemical” and therefore would not fall within Notification Entry 39 issued under Section 41 of the BST Act – the question is answered against the applicant and in favour of the revenue [Read less]

2019-VIL-227-CESTAT-CHE-CE  | CESTAT CENTRAL EXCISE

Central Excise - appellant is aggrieved by the disallowance of credit on items such as cement, MS angles, channels etc – HELD - It is not disputed that the items were used for work relating to installation of a new kiln in the factory. The appellant had procured duty paid TMT rods, steel rods, TOR steel, TMT bars, TMT rebar coil, steel structures etc. and supplied the same free of cost to CECL for construction of civil structure as well as supporting structures - The allegation is that after construction the kiln is embedded to earth and is an immovable property and therefore the goods that are used for such construction... [Read more]

Central Excise - appellant is aggrieved by the disallowance of credit on items such as cement, MS angles, channels etc – HELD - It is not disputed that the items were used for work relating to installation of a new kiln in the factory. The appellant had procured duty paid TMT rods, steel rods, TOR steel, TMT bars, TMT rebar coil, steel structures etc. and supplied the same free of cost to CECL for construction of civil structure as well as supporting structures - The allegation is that after construction the kiln is embedded to earth and is an immovable property and therefore the goods that are used for such construction of immovable property which is non-excisable is not eligible - An amendment was brought to Explanation (2) with effect from 7.7.2009 whereby a restriction was introduced for use of cement, angles, channels etc. for construction as well as for making support structures of capital goods. From the amendment, it can be safely concluded that prior to the amendment, the eligibility of credit on cement, MS angles, channels etc. used for construction, they are not ineligible - the disallowance of credit is unjustified. The impugned order is set aside and the appeal is allowed [Read less]

2019-VIL-157-ALH-CE  | High Court CENTRAL EXCISE

Central Excise - Rule 6 (1) of CCR, 2004 - Whether the Board Circular No.1027/15/2016-CX dated 25/04/2016, treating Bagasse to be an exempted good for the purpose of reversal of credit of input and input services in terms of Rule 6 of the CCR, 2004 is in consonance with the Central Excise Act and Rules – SCN seeking reversal of CENVAT credit relating to Bagasse which emerges during the process of manufacture of sugar – HELD - in absence of Bagasse being a manufactured final product, the obligation of reversal of CENVAT Credit under Rule 6(1) of the CCR, 2004 is not attracted - the Circular dated 25/04/2016 interpreting... [Read more]

Central Excise - Rule 6 (1) of CCR, 2004 - Whether the Board Circular No.1027/15/2016-CX dated 25/04/2016, treating Bagasse to be an exempted good for the purpose of reversal of credit of input and input services in terms of Rule 6 of the CCR, 2004 is in consonance with the Central Excise Act and Rules – SCN seeking reversal of CENVAT credit relating to Bagasse which emerges during the process of manufacture of sugar – HELD - in absence of Bagasse being a manufactured final product, the obligation of reversal of CENVAT Credit under Rule 6(1) of the CCR, 2004 is not attracted - the Circular dated 25/04/2016 interpreting Explanation 1 to Rule 6 has provided that Bagasse, dross and skimmings of non-ferrous metal or any such by product of waste, which are non-excisable goods and are cleared for consideration from the factory need to be treated like exempted goods for purpose of reversal of credit of input and input services, in terms of rule 6 of the CCR, 2004. The circular therefore treating Bagasse to be a non-excisable goods, is clearly erroneous, and for this reason also the Circular dated 25/04/2016 is liable to be quashed with regard to Bagasse – Rule 6 of the CCR, 2004 would have no application for reversal of CENVAT Credit in relation to Bagasse. The Circular No. 1027/15/2016-CX, dated 25/04/2016, to the extent that it includes Bagasse under the purview of the reversal of credit of input services in terms of Rule 6 of the CCR, 2004 is quashed - The writ petition is allowed [Read less]

2019-VIL-158-KAR-ST  | High Court SERVICE TAX

Service Tax – Notice for recover any service tax - cross-examination of witnesses - petitioner No.2 is the Managing Director of petitioner No.1-company. The petitioner No.1 Company is represented by its Managing Director-petitioner No.2. The petitioner No.2 cannot seek permission for cross examination of himself - no cross-examination of any witnesses whose statements are recorded by the adjudicating authority is sought in the present proceedings, petitioner No.2 is requesting to cross-examine himself and the adjudicating authority, which is inappropriate and cannot be acceded to - in the circumstances of the case, an op... [Read more]

Service Tax – Notice for recover any service tax - cross-examination of witnesses - petitioner No.2 is the Managing Director of petitioner No.1-company. The petitioner No.1 Company is represented by its Managing Director-petitioner No.2. The petitioner No.2 cannot seek permission for cross examination of himself - no cross-examination of any witnesses whose statements are recorded by the adjudicating authority is sought in the present proceedings, petitioner No.2 is requesting to cross-examine himself and the adjudicating authority, which is inappropriate and cannot be acceded to - in the circumstances of the case, an opportunity is provided to the petitioners to adduce any evidence to substantiate their stand. Keeping open all the rights and contentions of the parties, the proceedings are restored to the file of the Commissioner of Central Excise and Service Tax - writ petitions stand disposed of [Read less]

2019-VIL-229-CESTAT-CHE-ST  | CESTAT SERVICE TAX

Service Tax - Financial Lease or Operating Lease transaction - The Department of the view that Operating Lease entered into by the appellant is only a misnomer and that they are actually Financial Leases, which are subject to levy of service tax – demand of service tax along with interest and imposition of penalties - HELD – The clauses of lease agreement show that the ownership rests with the lessor (the appellant) and after determination of the lease in an Operating Lease, the lessee has to return the equipment/vehicle to the lessor. The lessee is not entitled to own or does not have an option to own the asset at the... [Read more]

Service Tax - Financial Lease or Operating Lease transaction - The Department of the view that Operating Lease entered into by the appellant is only a misnomer and that they are actually Financial Leases, which are subject to levy of service tax – demand of service tax along with interest and imposition of penalties - HELD – The clauses of lease agreement show that the ownership rests with the lessor (the appellant) and after determination of the lease in an Operating Lease, the lessee has to return the equipment/vehicle to the lessor. The lessee is not entitled to own or does not have an option to own the asset at the end of the lease period, which is the distinguishing feature between an Operating Lease and a Financial Lease - the financial statements of the appellant-company, as per Accounting Standards (AS-19), the Financial Lease is shown as current assets. Further, the Operating Lease is shown under the category of fixed assets. This is because, the equipment which are given on lease under the category of Operating Lease always remain in the ownership of the lessor (appellant-company) - We are therefore convinced that as per the documents, the transactions fall under the category of Operating Lease only. The allegation of the Department that the agreements are actually Financial Lease and that Operating Lease is only a misnomer, is factually wrong - the allegation by the Department that the lease agreements are in the nature of Financial Leasing, is incorrect and hence, the demand cannot sustain. The impugned Order is set aside and the appeals are allowed [Read less]

2019-VIL-155-GUJ  | High Court SGST

GST - Order for provisional attachment of bank accounts of the petitioner - HELD - the concerned officer has totally disregarded the findings recorded by this court in the earlier decision and with scant regard for the principles enunciated by the High Court in this very case, has proceeded to pass an identically worded order without complying with the principles laid down by this court. It appears that the officers of the concerned department think that they are above the law - One fails to understand why the concerned officer has at all attended the proceedings, if he had not bothered to come with the files. It is eviden... [Read more]

GST - Order for provisional attachment of bank accounts of the petitioner - HELD - the concerned officer has totally disregarded the findings recorded by this court in the earlier decision and with scant regard for the principles enunciated by the High Court in this very case, has proceeded to pass an identically worded order without complying with the principles laid down by this court. It appears that the officers of the concerned department think that they are above the law - One fails to understand why the concerned officer has at all attended the proceedings, if he had not bothered to come with the files. It is evident that the concerned officer must be availing of leave as well as other benefits for the purpose of coming from Bhavnagar to Ahmedabad. However, in absence of the files, the entire purpose of coming to the High Court is totally frustrated - by way of ad interim relief, the impugned order provisionally attaching the property of the petitioner under section 83 of the CGST Act, 2017 is stayed. The provisional attachment over the referred bank accounts of the petitioner shall be forthwith released – the matter is adjourned [Read less]

2019-VIL-156-GUJ  | High Court SGST

GST - Petition challenging the orders of attachment of bank accounts of the petitioners – assessee contention that in the absence of any proceeding under section 74 of the CGST Act, the action under section 83 of the CGST Act, 2017 is without authority of law - HELD - when the impugned order of the Deputy Director, DGGI, AZU itself informs the petitioners that the petitioners have a remedy against the order of attachment by way of filing objection under sub-rule (5) of rule 159 of the CGST Rules, 2017, this court would be reluctant to entertain these petitions under Article 226 of the Constitution of India in view of the... [Read more]

GST - Petition challenging the orders of attachment of bank accounts of the petitioners – assessee contention that in the absence of any proceeding under section 74 of the CGST Act, the action under section 83 of the CGST Act, 2017 is without authority of law - HELD - when the impugned order of the Deputy Director, DGGI, AZU itself informs the petitioners that the petitioners have a remedy against the order of attachment by way of filing objection under sub-rule (5) of rule 159 of the CGST Rules, 2017, this court would be reluctant to entertain these petitions under Article 226 of the Constitution of India in view of the fact that the petitioners have an efficacious alternative remedy before the competent authority before whom all the contentions raised in the present petitions can be raised. This court is, therefore, not inclined to entertain these petitions - the petitions are dismissed as not entertained [Read less]

2019-VIL-154-GUJ  | High Court SGST

GST - order of detention on account of deficiency in lorry receipt - Petitioner contention that in the absence of any statutory provision empowering the authorities to make an order of detention under section 129(1) of the CGST Act for any deficiency in the lorry receipt issued by the transporter, the impugned order of detention is without authority of law – HELD - Insofar as the Lorry Receipt issued by the transporter is concerned, carrying the same is not a requirement prescribed under Rule 138A(1) of the CGST Rules, 2017 - the contention raised by the petitioner appears to be valid. Under the circumstances, a prima fa... [Read more]

GST - order of detention on account of deficiency in lorry receipt - Petitioner contention that in the absence of any statutory provision empowering the authorities to make an order of detention under section 129(1) of the CGST Act for any deficiency in the lorry receipt issued by the transporter, the impugned order of detention is without authority of law – HELD - Insofar as the Lorry Receipt issued by the transporter is concerned, carrying the same is not a requirement prescribed under Rule 138A(1) of the CGST Rules, 2017 - the contention raised by the petitioner appears to be valid. Under the circumstances, a prima facie case has been made out for grant of interim relief as prayed for in the petition - the respondents are directed to forthwith release the truck along with the goods contained therein [Read less]

2019-VIL-159-ALH  | High Court VAT

U.P. Trade Tax Act, 1948 - Challenge to notice issued by the Commissioner under Section 4-A(3) of U.P. Trade Tax Act, 1948 proposing to recall the exemption sales tax exemption granted in respect of fixed capital investment made on moulds, dyes and jigs which was given to the suppliers for use outside the factory – HELD - The case of grant or rejection of exemption, should be decided at the earliest so that businessman can plan his business accordingly. The case in hand shows that four tax regime have changed and presently country in under new GST Regime, the old pending cases should be decided at the earliest which will... [Read more]

U.P. Trade Tax Act, 1948 - Challenge to notice issued by the Commissioner under Section 4-A(3) of U.P. Trade Tax Act, 1948 proposing to recall the exemption sales tax exemption granted in respect of fixed capital investment made on moulds, dyes and jigs which was given to the suppliers for use outside the factory – HELD - The case of grant or rejection of exemption, should be decided at the earliest so that businessman can plan his business accordingly. The case in hand shows that four tax regime have changed and presently country in under new GST Regime, the old pending cases should be decided at the earliest which will be in the interest of both the parties, therefore, the contention of the department for relegating back the petitioner to approach the Commissioner in pursuance of notice issued under Section 4-A(3) of the Act, is rejected - The Divisional Level Committee, after considering the report submitted by the two independent authorities has rightly directed to include the investment made by the petitioner in fixed capital investment towards moulds, dyes and jigs, which were given by the petitioner to various vendors for manufacture of components, which were exclusively being used for manufacture of components of the petitioner and, thereafter, manufacture of such components were supplied back only to the petitioner - The power of the Commissioner under Section 4-A (3) is not in dispute in the present case but, such a power has to be exercised judicially only - Once a legal issue which was already settled by judicial pronouncement the same cannot be permitted to be re-agitated by using the power under Section 4-A(3) of the Act - The impugned notice is quashed and writ petition is allowed [Read less]

2019-VIL-230-CESTAT-MUM-CU  | CESTAT Case CUSTOMS

Customs - Revenue appeal against the impugned order holding that the subject device is not classifiable as an Automatic Data Processing Machine and is appropriately classifiable as a mobile telephone under CTH 85171290 - Tablet PC or mobile telephone – HELD - the findings recorded by the Commissioner for ignoring the size of the item imported and trade parlance of the same cannot be sustained. The applicability of the Circular 17/2007-Cus relied upon by the Commissioner has to be determined after taking into account the size/ dimensions of the imported item and also the trade understanding of the same - the order of Comm... [Read more]

Customs - Revenue appeal against the impugned order holding that the subject device is not classifiable as an Automatic Data Processing Machine and is appropriately classifiable as a mobile telephone under CTH 85171290 - Tablet PC or mobile telephone – HELD - the findings recorded by the Commissioner for ignoring the size of the item imported and trade parlance of the same cannot be sustained. The applicability of the Circular 17/2007-Cus relied upon by the Commissioner has to be determined after taking into account the size/ dimensions of the imported item and also the trade understanding of the same - the order of Commissioner has been passed without application of mind. In the entire order he goes on rejecting the contentions raised by the respondents-assessee for claiming classification under CTH 8517 but finally decides the classification as claimed by them. He has failed to consider the manner in which the respondents-company have positioned themselves in the market vis a vis the imported item. In their own literature, they describe the products stating “Tablet with support for GSM voice communication, SMS and MMS”. Thus respondents have entered the market describing the product as Tablet with support for GSM voice Communication. This is enough to hold that voice communication is secondary function to the Tablet functions. When the respondents themselves hold that Tablet function is predominant, any finding rendered by the Commissioner to the contrary cannot survive - From the reading of Chapter Note 5(A) to Chapter 84, it is quite evident that the goods in question are nothing but an Automatic Data Processing Machine - the order of Commissioner and set aside and the matter is remanded back to the adjudicating authority - the appeal filed by the revenue is allowed by remand [Read less]

2019-VIL-225-CESTAT-MUM-CE  | CESTAT CENTRAL EXCISE

Central Excise - whether the Appellants are entitled for refund of the duty paid by them on Road Delivery Charges (RDC) collected by them from the dealers – HELD - the Learned Commissioner rejected the appeal filed by the appellants and allowed the appeal filed by the Revenue mainly in view of the earlier decision of this Tribunal. But since then the aforesaid order of the Tribunal was set aside by the Hon’ble High Court and the matter was remanded to the Tribunal for a fresh decision. Upon remand, the Tribunal decided the issue in favour of assessee - Since there was no occasion for the learned Commissioner to deal wi... [Read more]

Central Excise - whether the Appellants are entitled for refund of the duty paid by them on Road Delivery Charges (RDC) collected by them from the dealers – HELD - the Learned Commissioner rejected the appeal filed by the appellants and allowed the appeal filed by the Revenue mainly in view of the earlier decision of this Tribunal. But since then the aforesaid order of the Tribunal was set aside by the Hon’ble High Court and the matter was remanded to the Tribunal for a fresh decision. Upon remand, the Tribunal decided the issue in favour of assessee - Since there was no occasion for the learned Commissioner to deal with the latest decision of the Tribunal and since the foundation of the impugned order, i.e. the decision of the Tribunal, is not in existence, the impugned orders is set aside and matter is remanded to the learned Commissioner to decide the appeals afresh in view of the latest decisions - the appeals are allowed by way of remand [Read less]

2019-VIL-152-MP-CE  | High Court CENTRAL EXCISE

Central Excise - Respondent-assessee availed deemed credit in respect of final product i.e. man-made fabric and also on unprocessed fabrics/semi-processed fabrics lying in stock; which was processed and cleared from 02.06.1998 to 20.08.1998 - Revenue appeal seeking disallowance of deemed credit and levy of penalty – HELD - the Tribunal is well within its jurisdiction in regularizing the deemed credit under Notification No.29/96-CE (N.T.), dated 03.09.1996 as amended by Notification No.28/98-CE (NT), dated 18.07.1998 as the benefit taken by the assessee under Rule 57H was reversed – when there is no prohibition in the N... [Read more]

Central Excise - Respondent-assessee availed deemed credit in respect of final product i.e. man-made fabric and also on unprocessed fabrics/semi-processed fabrics lying in stock; which was processed and cleared from 02.06.1998 to 20.08.1998 - Revenue appeal seeking disallowance of deemed credit and levy of penalty – HELD - the Tribunal is well within its jurisdiction in regularizing the deemed credit under Notification No.29/96-CE (N.T.), dated 03.09.1996 as amended by Notification No.28/98-CE (NT), dated 18.07.1998 as the benefit taken by the assessee under Rule 57H was reversed – when there is no prohibition in the Notification No.29/96-CE (N.T.), dated 03.09.1996 as amended by Notification No.28/98-CE (NT), dated 18.07.1998 from reversing the Credit availed on the input to avail the benefit under said Notification No.29/96-CE (N.T.), dated 03.09.1996 as amended by Notification No.28/98-CE (NT), dated 18.07.1998, the Department are not benefitted by the law laid down by Hon’ble Supreme Court in Dilip Kumar and Company – Revenue appeals fail and dismissed [Read less]

2019-VIL-222-CESTAT-MUM-CU  | CESTAT Case CUSTOMS

Customs – redetermination of assessable value for the reason that upon examination the goods were found to be new and not ‘old and used’ as declared by the importer - import of ‘straw applicator 30’ and ‘bent foil treator’ - enhancement of value - HELD – In the report of examination by the docks unit nothing has been brought on record to controvert the finding therein on behalf of the appellant. Therefore, it is held that the goods are not ‘second hand’ as claimed by the appellant - the value adopted for assessment ‘straw applicator’ has not been challenged and it is only the finding on the conditio... [Read more]

Customs – redetermination of assessable value for the reason that upon examination the goods were found to be new and not ‘old and used’ as declared by the importer - import of ‘straw applicator 30’ and ‘bent foil treator’ - enhancement of value - HELD – In the report of examination by the docks unit nothing has been brought on record to controvert the finding therein on behalf of the appellant. Therefore, it is held that the goods are not ‘second hand’ as claimed by the appellant - the value adopted for assessment ‘straw applicator’ has not been challenged and it is only the finding on the condition that has been contested along with the ‘judgement’ by which ‘bent foil treator’ has been re-assessed. With our finding of goods not being ‘second hand’, the absence of challenge to the enhanced value of ‘straw applicator’ renders a finality to the assessment - Insofar as ‘bent foil treator’ is concerned, the enhancement suffers from incompatibility with the Customs Valuation Rules, 2007 - The proportionate application of the enhancement adopted for an entirely different goods from a different context does not fulfil these prescriptions. The enhancement of value of ‘bent foil treator’, therefore, lacks sanctity of law - the appeal is allowed except to the extent of confirming the duty liability arising from the enhanced value of ‘straw applicator 30’ – assessee appeal is partly allowed [Read less]

2019-VIL-147-MP-ST  | High Court SERVICE TAX

Service Tax – petitioner was engaged in the business of advertising - whether petitioner, being an individual, falls within the purview of 'advertising agency' and required to pay the service tax prior to Finance Act, 2006 – term “Commercial Concern” - HELD - the petitioner was engaged in the business of advertising thus cannot claim that he is not a commercial concern and had rightly obtained the registration certificate under Service Tax Act in the year 1997 - “advertising agency” as defined under Section 65(3) of the Act means “any person engaged in providing any service connected with the making, preparat... [Read more]

Service Tax – petitioner was engaged in the business of advertising - whether petitioner, being an individual, falls within the purview of 'advertising agency' and required to pay the service tax prior to Finance Act, 2006 – term “Commercial Concern” - HELD - the petitioner was engaged in the business of advertising thus cannot claim that he is not a commercial concern and had rightly obtained the registration certificate under Service Tax Act in the year 1997 - “advertising agency” as defined under Section 65(3) of the Act means “any person engaged in providing any service connected with the making, preparation, display or exhibition of advertisement and includes an advertising consultant” - by substituting the expression “person” in place of “Commercial Concern” will not lead to a conclusion that the “person” was a different from “Commercial Concern” - the assumption drawn by the petitioner that with the substitution of “Commercial Concern” with the word “person” in 2006, the petitioner was not amenable to service tax cannot be countenanced - the petitioner is required to pay the service tax prior to Finance Act, 2006 - the petition fails and is dismissed [Read less]

2019-VIL-217-CESTAT-CHE-ST  | CESTAT SERVICE TAX

Service Tax - Department appeal contesting input service tax credit allowed in respect of courier service availed for inward transportation of raw materials as well as for sending the goods for job works – HELD – There is no restriction with regard to the goods that are sent for job work or for receiving the inputs into the factory. The restriction, if any, is only for the outward transportation of goods beyond the place of removal. In the present case, the place of removal is the buyer’s premises for the reason that the purchase orders are placed on FOR basis and the appellant would be able to establish that the pla... [Read more]

Service Tax - Department appeal contesting input service tax credit allowed in respect of courier service availed for inward transportation of raw materials as well as for sending the goods for job works – HELD – There is no restriction with regard to the goods that are sent for job work or for receiving the inputs into the factory. The restriction, if any, is only for the outward transportation of goods beyond the place of removal. In the present case, the place of removal is the buyer’s premises for the reason that the purchase orders are placed on FOR basis and the appellant would be able to establish that the place of removal is the buyer’s premises - The definition does not put any restriction with regard to inward transportation of raw materials and so also in the case of goods sent for job work. The credit availed on the service tax paid for such charges would thus be eligible – the period involved is from March 2007 to February 2010. The credit availed up to 01.04.2008 would therefore be eligible to the appellant. Thus, the eligibility of credit in respect of courier services needs re-consideration both with regard to quantification as well as eligibility for the period after 01.04.2008 - The appeal is allowed by way of remand [Read less]

2019-VIL-224-CESTAT-CHE-ST  | CESTAT SERVICE TAX

Service Tax – refund claim of service tax already paid in respect of Development Charges – benefit of Notification No.41/2016-ST, dated 22.09.2016 - rejection of refund claim on the ground of being time-barred – condonation of delay of one day - HELD – the notification is a beneficial notification wherein it exempts service tax on Development Charges so as to give incentives for promotion of industry. Taking into consideration the fact that there has been delay on the part of the SIPCOT to inform the appellant and also taking note of the fact that the last date for filing the refund claim was a holiday, in the inte... [Read more]

Service Tax – refund claim of service tax already paid in respect of Development Charges – benefit of Notification No.41/2016-ST, dated 22.09.2016 - rejection of refund claim on the ground of being time-barred – condonation of delay of one day - HELD – the notification is a beneficial notification wherein it exempts service tax on Development Charges so as to give incentives for promotion of industry. Taking into consideration the fact that there has been delay on the part of the SIPCOT to inform the appellant and also taking note of the fact that the last date for filing the refund claim was a holiday, in the interest of justice, the delay of one day, if any, is condoned. On the peculiar facts of the case, the delay of one day is condoned. It is made clear that this decision is only on the very peculiar facts of the case – answered in favour of assessee [Read less]

2019-VIL-226-CESTAT-ALH-ST  | CESTAT SERVICE TAX

Service Tax – Respondent-assessee availed the services of M/s. Indian Sugar Exim Corporation (ISEC) for fulfillment of its export obligation of sugar – revenue appeal seeking disallowance of re-credit of duty reversed earlier under protest on the ground that services provided by ISEC do not fall in the definition of input service – HELD - the services of ISEC were utilized for fulfillment of export obligation and ultimately, sugar was exported. Accordingly, the services procured were in respect of manufacture of final products of the appellant – since the appellants had availed services to fulfill the export obliga... [Read more]

Service Tax – Respondent-assessee availed the services of M/s. Indian Sugar Exim Corporation (ISEC) for fulfillment of its export obligation of sugar – revenue appeal seeking disallowance of re-credit of duty reversed earlier under protest on the ground that services provided by ISEC do not fall in the definition of input service – HELD - the services of ISEC were utilized for fulfillment of export obligation and ultimately, sugar was exported. Accordingly, the services procured were in respect of manufacture of final products of the appellant – since the appellants had availed services to fulfill the export obligation and to receive the production subsidy, the services were in respect of appellant final product - There was no objection by the Revenue at the time of availment of original credit, which objection cannot be raised at the time of re-credit – the impugned order is upheld and revenue appeal is rejected [Read less]

2019-VIL-146-ALH  | High Court SGST

GST – revision in GST TRAN-1 – proper authority for submission of application for extending the time period for revised FORM GST TRAN-1 – HELD - the application for extending the time period for submitting the revised FORM GST TRAN-1 electronically has to be extended by the Commissioner and not by any other subordinate authority - as the petitioner has already submitted an application for extension of time, to submit the revised FORM GST TRAN-1 to the Nodal Officer, the Commissioner concerned is directed to ensure that the aforesaid application so submitted by the petitioner before the Nodal Officer may be called upo... [Read more]

GST – revision in GST TRAN-1 – proper authority for submission of application for extending the time period for revised FORM GST TRAN-1 – HELD - the application for extending the time period for submitting the revised FORM GST TRAN-1 electronically has to be extended by the Commissioner and not by any other subordinate authority - as the petitioner has already submitted an application for extension of time, to submit the revised FORM GST TRAN-1 to the Nodal Officer, the Commissioner concerned is directed to ensure that the aforesaid application so submitted by the petitioner before the Nodal Officer may be called upon by him and appropriate orders are passed on it in accordance with law most expeditiously – the writ petition is disposed of [Read less]

2019-VIL-148-MP  | High Court SGST

CGST Act, 2017 - Offence under section 132 – application for bail - Applicant contention that as per Section 69 of the Act, without authorization, no arrest can be made and in absence of such authorization, it is illegal detention – HELD - Section 132 of the Act prescribes punishment for certain offences and maximum sentence which can be awarded, is five years. Section 167 (2) of the Cr.P.C provides 60 days time to the investigating agency to submit charge sheet for the offences where investigation relates to any offence other than total imprisonment for life or imprisonment for a term of not less than 10 years. Here t... [Read more]

CGST Act, 2017 - Offence under section 132 – application for bail - Applicant contention that as per Section 69 of the Act, without authorization, no arrest can be made and in absence of such authorization, it is illegal detention – HELD - Section 132 of the Act prescribes punishment for certain offences and maximum sentence which can be awarded, is five years. Section 167 (2) of the Cr.P.C provides 60 days time to the investigating agency to submit charge sheet for the offences where investigation relates to any offence other than total imprisonment for life or imprisonment for a term of not less than 10 years. Here the maximum sentence punishable is imprisonment for five years therefore, respondent had to file the charge sheet within 60 days. But admittedly, charge sheet has not been filed, therefore, right of ‘default bail’ accrued to the applicant after completion of 60 days. It was the duty of the investigating agency to submit charge sheet within the stipulated period, but same has not happened - the application is allowed and it is directed that the applicant be released on bail subject to certain conditions [Read less]

2019-VIL-150-DEL  | High Court SGST

GST - Petitioner seeking quashing of impugned circulars to the extent they seek to levy GST on sale of REC scrips – cost for non-disclosure of material facts by the petitioner – HELD - Nowhere in the present petition the facts concerning the filing of the earlier petition and its withdrawal been mentioned - With the counsel on both occasions being the same, and being fully aware of the facts, it was imperative for the Petitioner to have made a full and correct disclosure of all the material facts concerning the filing of the earlier petition by the same Petitioner seeking the same relief. That not having been done, the... [Read more]

GST - Petitioner seeking quashing of impugned circulars to the extent they seek to levy GST on sale of REC scrips – cost for non-disclosure of material facts by the petitioner – HELD - Nowhere in the present petition the facts concerning the filing of the earlier petition and its withdrawal been mentioned - With the counsel on both occasions being the same, and being fully aware of the facts, it was imperative for the Petitioner to have made a full and correct disclosure of all the material facts concerning the filing of the earlier petition by the same Petitioner seeking the same relief. That not having been done, the Court dismisses the present petition with cost of Rs. 1,00,000/- which would be paid by the Petitioner to the DHCLSC [Read less]

2019-VIL-151-KER  | High Court SGST

Kerala SGST Act, 2017 – Section 67 & 130 - the petitioners entrusted gold jewellery with the hallmarker under cover of delivery challan and issue vouchers for the purposes of hallmarking of jewellery – petitioner seeking quashing seizure orders and prohibition orders, insofar as they relate to the quantity of gold jewellery entrusted by the petitioners to the hallmarker and seized during inspection at the premises of hallmarker – HELD - The proceedings initiated under the SGST Act against the hallmarker must be for recovery of any tax from him or for the imposition of any penalty in connection with any offence commit... [Read more]

Kerala SGST Act, 2017 – Section 67 & 130 - the petitioners entrusted gold jewellery with the hallmarker under cover of delivery challan and issue vouchers for the purposes of hallmarking of jewellery – petitioner seeking quashing seizure orders and prohibition orders, insofar as they relate to the quantity of gold jewellery entrusted by the petitioners to the hallmarker and seized during inspection at the premises of hallmarker – HELD - The proceedings initiated under the SGST Act against the hallmarker must be for recovery of any tax from him or for the imposition of any penalty in connection with any offence committed by him in that context - in any proceedings against the hallmarker, the authorities under the SGST Act, cannot ultimately confiscate the gold seized from the hallmarker, when it cannot be disputed that the gold jewellery seized belongs to the petitioners, and the entrustment of the same is evidenced by the delivery challans and issue vouchers - the seizure of the gold jewellery from the premises of the hallmarker, may be justified in accordance with Section 67 of the SGST Act, for the purposes of enabling the authorities to compute the ultimate liability of tax and/or penalty under the SGST Act. Beyond that, the seizure of the gold jewellery, which belongs to the petitioners, and against whom no proceedings are initiated under the SGST Act, is not justified - in the context of the present proceedings, the goods entrusted to the hallmarker by the petitioners, cannot be confiscated in terms of Section 130 of the SGST Act, since the confiscation under the said provision can only be in respect of supplies or receipt of any goods in contravention of any of the provisions of the Act, with an intent to evade payment of tax. There being no possibility of an evasion of tax in respect of the goods, by the hallmarker since the goods themselves belong to the petitioners - the goods entrusted by the petitioners, with the hallmarker, and covered by the delivery challan and issue vouchers, cannot be the subject matter of a confiscation order under Section 130 of the SGST Act – the impugned seizure orders and prohibition orders stands quashed - The writ petitions are disposed in favour of petitioner [Read less]

2019-VIL-149-P&H  | High Court VAT

Haryana VAT Act, 2003 - Section 7(6) of the Haryana VAT Act, 2003 & Section 11(1)(i) of the HSEZ Act, 2005 - Whether developer and co-developer of a SEZ are entitled to exemption from payment of tax under the HVAT Act by virtue of Section 11(1)(i) of the HSEZ Act, 2005 – HELD - although developer or co-developer of a SEZ has not been exempted from payment of tax under the HVAT Act by section 7(6) of the HVAT Act and only an individual unit/dealer has been exempted for setting up of the unit in SEZ area, but a developer and co-developer of a SEZ are entitled to exemption from payment of tax under the HVAT Act by virtue of... [Read more]

Haryana VAT Act, 2003 - Section 7(6) of the Haryana VAT Act, 2003 & Section 11(1)(i) of the HSEZ Act, 2005 - Whether developer and co-developer of a SEZ are entitled to exemption from payment of tax under the HVAT Act by virtue of Section 11(1)(i) of the HSEZ Act, 2005 – HELD - although developer or co-developer of a SEZ has not been exempted from payment of tax under the HVAT Act by section 7(6) of the HVAT Act and only an individual unit/dealer has been exempted for setting up of the unit in SEZ area, but a developer and co-developer of a SEZ are entitled to exemption from payment of tax under the HVAT Act by virtue of Section 11(1)(i) of the HSEZ Act, 2005 – No illegality or perversity in the conclusion recorded by the Tribunal - Revenue appeals are dismissed on merits as well as being barred by time [Read less]

2019-VIL-153-KER  | High Court VAT

Kerala Value Added Tax Act, 2003 - scope of judgement of Writ Court in the case of M/s Sheen Golden Jewels (India) Pvt Ltd - Assessee appeal contending the VAT assessment stands barred by limitation in terms of Section 25(1) of the KVAT Act – HELD – the question decided in M/s Sheen Golden Jewels (India) Pvt Ltd and connected cases only pertains to the constitutional validity of Section 174 of the KSGST Act and the learned Single Judge had omitted to consider the challenge raised against the assessment passed on the question of limitation - the correctness of the abovesaid decision are now under consideration in variou... [Read more]

Kerala Value Added Tax Act, 2003 - scope of judgement of Writ Court in the case of M/s Sheen Golden Jewels (India) Pvt Ltd - Assessee appeal contending the VAT assessment stands barred by limitation in terms of Section 25(1) of the KVAT Act – HELD – the question decided in M/s Sheen Golden Jewels (India) Pvt Ltd and connected cases only pertains to the constitutional validity of Section 174 of the KSGST Act and the learned Single Judge had omitted to consider the challenge raised against the assessment passed on the question of limitation - the correctness of the abovesaid decision are now under consideration in various writ appeals. Under such circumstances, a remittance of the writ petition for a fresh consideration on the question of limitation with respect to completion of the assessment as well as regarding the alleged violation of principles of natural justice in finalizing the assessment, is only proper and justifiable - the impugned judgment is hereby set aside and writ appeal is allowed [Read less]

2019-VIL-113-AAR  | Advance Ruling Authority SGST

GST – Maharashtra AAR – for acceptance of Advance Ruling application it is mandatory as per section 97(1) r/w Rule 104 of the CGST / MGST Act to pay applicable fee of Rs. 5000/- each under SGST and CGST Act to be deposited in the manner as provided under Section 49 of the Act. If not, the application would be treated as an incomplete application liable for rejection - the applicant has only deposited an amount of Rs. 5000/- towards fees and not the full amount of Rs. 10000/-. The opportunity so far granted to the applicant constitutes sufficient opportunity to cure the defect which applicant has failed to avail. As suc... [Read more]

GST – Maharashtra AAR – for acceptance of Advance Ruling application it is mandatory as per section 97(1) r/w Rule 104 of the CGST / MGST Act to pay applicable fee of Rs. 5000/- each under SGST and CGST Act to be deposited in the manner as provided under Section 49 of the Act. If not, the application would be treated as an incomplete application liable for rejection - the applicant has only deposited an amount of Rs. 5000/- towards fees and not the full amount of Rs. 10000/-. The opportunity so far granted to the applicant constitutes sufficient opportunity to cure the defect which applicant has failed to avail. As such application is incomplete and is liable for rejection - The Application for advance ruling is rejected as being not maintainable [Read less]

2019-VIL-114-AAR  | Advance Ruling Authority SGST

GST – Maharashtra AAR - Applicant is engaged in renting of immovable property to business entities for commercial purpose - Whether GST is applicable on interest free security deposit and notional interest taken from the lessees on returnable basis – HELD - for leasing of commercial property has, in addition to rent, applicant has also collected interest free deposit from their lessee which is returnable on the completion of the tenure of the lease. Since the entire amount is to be returned back to their lessee, such deposits cannot be considered as consideration for such supply of services and hence will not be liable... [Read more]

GST – Maharashtra AAR - Applicant is engaged in renting of immovable property to business entities for commercial purpose - Whether GST is applicable on interest free security deposit and notional interest taken from the lessees on returnable basis – HELD - for leasing of commercial property has, in addition to rent, applicant has also collected interest free deposit from their lessee which is returnable on the completion of the tenure of the lease. Since the entire amount is to be returned back to their lessee, such deposits cannot be considered as consideration for such supply of services and hence will not be liable to GST. However at the time of completion of the lease tenure, if the entire deposit or a part of it is withheld and not paid back, as a charge against damages, etc. then at that stage such amounts not returned back will be liable to GST [Read less]

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