This yearly digest analyzes all the CESTAT stories published in the year 2023 at taxscan.in
The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), observed that there is no mandate under Rule 5 of Cenvat Credit Rules, 2004 (CCR) that registration should be condition for refund of accumulated credit. In the appeal M/s. Saipem India Projects Limited, the respondent herein, are holders of Service Tax Registration under the category of Consulting Engineer Service, Commercial Training and Coaching, Business Support Service and Information Technology Software Service. The respondent is mainly engaged in providing engineering and allied services in relation to projects in oil and gas, petrochemicals and refineries, both domestic and international.
A Two-Member Bench of the Tribunal comprising P Dinesha, Judicial Member and Vasa Seshagiri Rao, Technical Member held that “Whether it be registration or centralized registration, when there is no mandatory provision in the Rules regarding registration, the Cenvat Credit cannot be denied.”
In the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chennai has held that the total Cenvat credit for the purpose of formula under Rule 6 (3A) of Cenvat Credit Rules, 2004 is applicable only on common input services and set aside the demand of service tax.
The CESTAT set aside the demand raised alleging non-adoption of the correct formula for reversal of cenvat credit under Rule 6 (3) of CCR only and partly allowed the appeal.
The Kolkata bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT) has held that interest is not chargeable if credit has been taken but not utilised and subsequently reversed.
The CESTAT viewed that since the Appellant had sufficient credit balances as noted above, there would be no loss of Revenue to the exchequer, therefore, the imposition of interest cannot sustain. While allowing the appeal, the bench set aside the impugned orders.
The Kolkata bench of the Customs, Excise and Service Tax Appellate Tribunal( CESTAT) has held that the demand for service tax based on the audit report of Indian Oil Corporation Ltd(IOCL) which is a third party and income tax department’s information from Form 26as is not valid.
Further viewed that the Chartered Accountant’s certificate that the entire value as per form 26AS has suffered tax to the extent of supplies taxable under forward charge and only GTA services provided by the Appellant has not suffered tax at the hands of the Appellant as the recipient was liable to pay Service Tax on the same. The Authorized Representative has not been able to make out a case that the services of works contract as provided by the Appellant are not allowed abatement as claimed by the Appellant or otherwise that such services were not provided by the Appellant. While allowing the appeal, the CESTAT set aside the impugned order.
The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), upheld the assessment of Countervailing Duty (CVD) on basis of retail sale price for prepared glues and other prepared adhesives.
“In view of the above, we do not find any reason to differ with the decision of the lower appellate authority on the issue of including the imported adhesives for the purpose of collection of CVD on the basis of retail sale price in terms of Notification No. 49/2008-C.E.(N.T.) dated 24.12.2008 issued under Section 4A of the Central Excise Act, 1944” the Bench noted.
The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), ruled that service tax not leviable on delayed payment charges collected from customers wef 01.07.2012
A Division Bench of the Tribunal comprising CS Sulekha Beevi, Judicial Member and M Ajit Kumar, Technical Member held that “Service tax could not be levied on ‘delayed payment charges’ collected by the appellant from their customers from 01.07.2012 also.”
The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) quashed the denial of the service tax refund claim made on receipt of reimbursement from overseas importer.
A Single Bench of the Tribunal comprising R. Muralidhar, Member (Judicial) held that “Considering the above factual details, I feel that the Lower Authorities have erred in rejecting the refund claim on the ground that component himself, I hold that he is entitled to get refund.”
The Ahmedabad bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that trade discounts cannot be added to central excise duty.
A two-member bench comprising Mr Ramesh Nair, Judicial Member and Mr C L Mahar, Technical Member held that penalty under the Excise Act, is not applicable and discount cannot be added to the amount of Central Excise Duty.
The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), reiterated that no tax proceedings can be initiated or continued against a dead person.
A Division Bench of the Tribunal comprising Vasa Seshagiri Rao, Technical Member and P Dinesha, Judicial Member observed that “We find the Respondent has died on 22.08.2019 during the pendency of the present appeal. We also find that in terms of Rule 22 of Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982 on the death of the Respondent, the proceedings will be abated unless an application is made for continuance of such proceedings. In this case no such application is made. As the Death has occurred on 22.08.2019, more than three and half years passed already.”
The Mumbai bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that no unjust enrichment when the refund was advance paid as per sub rule (1a) of rule 6 of service tax rules and directed to issue a refund cheque.
Further held that “since the amount sought for refund was advance paid as per the said subrule, the question of unjust enrichment does not arise. We, therefore, allow the appeal after setting aside the impugned order and direct the original authority to issue the refund cheque to the appellant within a period of four weeks from the date of service of a copy of this order on him.”
In a significant case, the Bangalore bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) reduced the penalty since there was no evidence to prove that the import amount was more than the goods declared to Customs.
It was viewed that in Omex International’s case, it was held that the redemption fine and penalty in such cases be 10% and 5% of the value. Following the aforesaid precedent, the impugned order is modified and the fine and penalty in each of the cases are reduced to 10% and 5% of the enhanced value.
The Chennai bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that a show cause notice issued to an invalid address and an order passed without intimation for a personal hearing is violative of the natural justice principle.
A two-member bench of Ms Sulekha Beevi C.S., Member (Judicial) and Shri M. Ajit Kumar, Member (Technical) held that the Show Cause Notice was not issued to the appellant and also that the order has been passed exparte, which establishes a clear violation of principles of natural justice. The Tribunal set aside the demand and allowed the appeal.
The National Company Law Appellate Tribunal (NCLAT) upheld the National Company Law Tribunal (NCLT)order in the absence of ‘Proof of Receipt’ for due acknowledgement of notice through registered post. The Tribunal upheld the impugned order since there was no illegality or infirmity in the Impugned Order dated and dismissed the appeal.
The Kolkata bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that the classification of non-textured fabrics must be based on nature and material coated.
A two-member bench comprising of Mr P K Choudhary, Member (Judicial) and Mr K Anpazhakan, Member (Technical) observed that coated fabrics visible to the naked eye would fall under Chapter 59 only. But, the specific sub-heading under which it is to be classified will depend on the nature of the material coated. While rejecting the appeal, the CESTAT held that the goods are not classifiable under CTH 54071094 as proposed by the Appellant department.
The Kolkata bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) setaside the Order passed by the Commissioner of Appeals where in the refund claim of service tax paid was rejected without stating the reason.
The impugned order is a cryptic order, not a speaking order. TheSingle member bench comprising Mr Ashok Jindal, Member (Judicial) set aside the impugned order and remanded the matter to the Commissioner (Appeals) to pass a detailed order on merit after hearing the appellant.
The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), quashed service tax demand on amount received from ‘Renting of Immovable Property Services’.
The Tribunal concluded that “If the business is at a loss or suppose the hotel has to be closed down (for eg., in a situation like lockdown during COVID-19) there may not be any income for the hotel. The appellant then does not get any consideration. Whereas in a situation of renting of immovable property, the consideration is for the service of providing renting of immovable property. In other words, the rent is paid all along when the transfer of right in the immovable property is active and alive.”
The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), confirmed setting aside of confiscation and held that low aromatic white spirit is classifiable under Light Oil and Preparations under the Customs, Tariff Act.
“The Respondents submitted that they have applied for enhancement of the quantity which has since been approved. Therefore, section 111(d) of the Customs Act, 1962 is not applicable as far as the impugned goods are concerned and confiscation is not warranted on this count” the Tribunal noted.
The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), allowed Cenvat Credit of service tax paid on ‘Business Support Service’ (BSS), thereby granting relief to M/s.Hindalco Industries Limited, the appellant. M/s. Aditya Birla Management Corporation Pvt Ltd (ABMCPL) obtained Service Tax registration under the category of ‘Business Support Service’ to be provided to the group companies and duly discharged Service Tax thereon. At the end of each month, ABMCPL issued tax invoices charging its total cost on the group companies in the agreed ratio and collected Service Tax under the head of ‘Business Support Service’ in the tax invoices. The Service Tax collected was duly deposited with the Government and reflected in the periodical returns.
The Tribunal concluded by noting that “Hence the Appellant is entitled to avail the CENVAT Credit of service tax paid on BSS since they have a nexus with the overall business activity of manufacturing final goods and are essential for the day-to-day operations of the Appellant.”
The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), quashed service tax demand on the Concession Agreement for the Development of the Karaikal Port Project to develop the port on a Build, Operate, Transfer (BOT) basis.
A Two-Member Bench of the Tribunal comprising observed that “The ‘concession fee’ paid by KPPL to the Puducherry Port as a percentage of gross revenue generated by the concessionaire each year is also not a payment for any support services of business or commerce given by the Port Department to KPPL. It is basically a payment for the rights to develop/operate/maintain the Port including project facilities. We are accordingly of the view that the impugned order has erred in classifying the activity of the BOT contract under sec. 65(105) (zzzq) of the Finance Act, 1994 and that the levy must fail.”
The Bangalore Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) dismissed the appeal as withdrawn as the Discharge Certificates in Form-4 were issued under the Sabka Vishwas – (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS).
A Two-Member Bench of the Tribunal comprising PA Augustin, Judicial Member and Pullela Nageswara Rao, Technical Member dismissed the present appeal as deemed to have been withdrawn.
The Hyderabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), ruled that the Export Oriented Units (EOU) are required to pay excise duty only by way of cash and Cenvat credit cannot be utilized when raw materials/ inputs cleared.
The Two-Member Bench of the Tribunal consisting of R Muralidhar, Judicial Member and AK Jyotishi, Technical Member observed that “If the raw materials/ inputs cleared pertain to procuring the inputs by getting the benefit of Notification No. 52/2003-CUS, the EOU is required to pay the duty only by way of cash and Cenvat credit cannot be utilized since the inputs were imported by claiming Customs Duty exemption.”
The Chandigarh Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), quashed service tax demand by holding that the certificates given by Experts in their respective fields cannot be ignored without providing cogent reasons.
Quashing the service tax demand, the Tribunal further noted that “We are of the considered opinion that certificates given by Experts in the respective fields cannot be ignored without cogent reasons. Therefore, we find that the duty has been correctly paid by the appellants.”
The Bangalore Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), ruled that no condition of re-export to be imposed when the goods are allowed to be redeemed on the payment of appropriate fine.
A Two-Member Bench of the Tribunal comprising Dr DM Misra, Judicial Member and R Bhagya Devi, Technical Member observed that “We do not see merit in the Order of the lower authorities directing absolute confiscation and allowing redemption solely to re-export on payment of redemption fine and penalty. Hence, the impugned order is modified to the extent of setting aside the direction of absolute confiscation and condition of re-export for redemption on payment of fine and penalty and hold that the goods are liable for confiscation.”
The Ahmedabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), ruled that the mount deposited without the authority of law cannot be considered as Service Tax and it is refundable.
The Bench concluded by noting that in the instant case, the amount deposited by the appellants without any authority of law cannot be considered as Service Tax. Therefore, the appellant is entitled to get the refund.
The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), upheld the rejection of service tax refund claim filed beyond time limit under Section 11B of the Central Excise Act.
A Single Member Bench of the Tribunal comprising Ashok Jindal, Judicial Member observed that “I find that in this case initially appellant filed refund claim which was already sanctioned to the appellant, therefore the matter comes to end. Later on, filing the refund claimed by the appellant cannot be entertained as this stage being continuation of the initial refund claim by the appellant and it is admitted fact the impugned refund claim has been filed beyond the time limit prescribed under Section 11B of the Central Excise Act.”
The Ahmedabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), ruled that the adjustment under Rule 6(4A) of Service Tax Rules is permissible if made in the succeeding month or quarter.
The Two-Member Bench of the Tribunal comprising (Ramesh Nair) Member (Judicial) and (C L Mahar) Member (Technical) observed that “We hold that the demand of Rs. 1,87,93,063/- is not sustainable against the appellant and the same is hereby quashed with consequential relief to the appellant. Thus, there was in reality no short payment by the appellant. We further find that the findings of the Commissioner, that the appellant could not have adjusted the excess tax paid on 4.11.2010/31.03.2011 beyond the month of Nov 2010/April 2011 is also not sustainable.”
The Ahmedabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), granted customs duty exemption on oxygen used in manufacture of sulphuric acid, thereby granting relief to Hindalco Industries Limited, the appellant.
A Two-Member Bench of the Tribunal comprising Ramesh Nair, Judicial Member and CL Mahar, Technical Member concluded by noting that “Since the facts of the matter at hand are similar to the one decided by this Tribunal on the basis of Apex Court decision in the case of Hindustan Zinc, we follow the same and hold that impugned Orders-In-Original are without any merit and we set aside the same.”
The Ahmedabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), ruled that there can be no demand of excise duty on reversal of Cenvat credit for common input service used in manufacture of exempted goods equal to 10% or 5%.
The Two-Member Bench of the Tribunal comprising (Ramesh Nair) Member (Judicial) and (C L Mahar) Member (Technical) observed that “If the assessee reverses the Cenvat credit in respect of common input service used in the manufacture of exempted goods the demand equal to 10%/5% will not sustain. Therefore, we do not find any merits in the impugned order confirming demand for the period April 2008 to June 2009.”
The Bangalore Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), dismissed an appeal filed as precautionary measure for ambiguity caused regarding correct jurisdiction for filing second appeal.
A Single Member Bench of the Tribunal comprising Pullela Nageswara Rao, Technical Member concluded by noting that “The request of the appellant for the withdrawal of the appeals is allowed and the 6(six) appeals filed are dismissed as withdrawn.”
The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), quashed the excise duty demand on utilizing cenvated inputs in processing on job work undertaken.
A Single Member Bench of the Tribunal comprising PK Choudhary, Judicial Member observed that “It is my considered view that there was no irregularity on the part of the Appellant in utilizing the cenvated inputs in the processing of goods in course of job work undertaken by them. Moreover, there was no contravention of any statutory provisions. In view of the above discussions, the impugned orders cannot be sustained and are therefore set aside.”
The Chandigarh Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), quashed service tax demand under Works Contract Service and noted that the extended period of limitation is not invokable in the said case.
A Two-Member Bench of the Tribunal comprising SS Garg, Judicial Member and P Anjani Kumar, Technical Member observed that “In the case of Srishti Construction vs. Commissioner of Central Excise & ST, Ludhiana, the Division Bench of this Tribunal has also set-aside the demand of service tax under Works Contract Service and has also held that the extended period of limitation is not invokable and allowed the appeal of the appellant with consequential relief, if any, as per law.”
The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Kolkata, has held that there is no Service Tax implication on the Administrative Charges received by the Coal Mines Provident Fund Organization (CMPFO) in the absence of Service Provider-Service Recipient Relationship & Consideration.
The two-member bench consisting ofShri P.K. Choudhary (Judicial Member) and Shri K. Anpazhakan (Technical Member), while providing clarity on the service tax implication of administrative charges collected under the Coal Mines Provident Fund and Miscellaneous Provisions Act, 1948, set aside the order and allowed the appeal with consequential relief as per law.
The Ahmedabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), ruled that Certificates when issued by qualified professionals like cannot be rejected for want of corroborative evidence.
The Two-Member Bench of the Tribunal comprising Ramesh Nair, Judicial Member and CL Mahar, Technical Member observed that “It is a settled principle of law that the certificates issued by qualified professionals like Cost Accountants, Chartered Accountants, Chartered Engineers should not be brushed aside merely with the statement that corroborative evidence was not produced. They need to be accepted by the department unless investigation is undertaken in doubtful cases and the data is re-verified by appointing its own cost accountant or producing another material on record.”
The Hyderabad bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT)has held that refund of excess paid duty must be credited to the consumer welfare fund in the absence of evidence to prove unjust enrichment.
A single-member bench comprising Mr A K Jyotishi, Member (Technical) viewed that in the absence of any evidence, merely producing a CA certificate would not suffice to shift the burden of presumption for Section 27 read with Section 28C of the Customs Act. The bench set aside the Order of the Commissioner (Appeals) and restored the Order of the Original Authority.
The Chennai Bench of Customs, Excise Service Tax Appellate & Tribunal(CESTAT) held that the claim of refund of special additional duty(SAD) should be filed within one year from the payment of duty.
The two-member bench comprising of Ms Sulekha Beevi C.S., Member (Judicial) and Shri M. Ajit Kumar, Member (Technical) held that any payment of duty made was entitled to a refund if filed within one year while dismissing the appeal filed by the assessee.
The Chennai bench of Customs, Excise & Service Tax Appellate Tribunal(CESTAT) quashed the order passed by the Commissioner of Central Excise for the issuance of show cause notice after the expiry of time limit.
The two-member bench comprising of Shri. Sulekha Beevi C.S., Member (Judicial) and Shri M. Ajit Kumar, Member (Technical) held that the department was not justified in invoking the larger time limit for the issuance of show cause notice while allowing the appeal filed by the assessee.
The Chennai bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that the emails of the supplier not authentic evidence to prove the contention of wrong supply by the importer.
“The Commissioner (Appeals) committed an error in allowing the appeal of the importer without there being any evidence in support of the importer’s claim and hence, the impugned order cannot sustain.”, the bench held.
The Chennai bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) upheld the Service tax demand and observed that the activities of the appellant clearly fall under the definition of cargo handling service.
The appellant did not even submit ST-3 results within the required timeframe, according to the bench of Vasa Seshagiri Rao and P. Dinesha. The tribunal is convinced that even the appellant’s claim that the extended period of limitation was invoked is incorrect.
The Chennai bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) in a recent case dismissed the appeal due to the failure by the appellant to demarcate the service period of Refund claimed on Service tax paid mistakenly on Goods and Transport Service (GTA) of the cylinder.
A two-member bench comprising Ms Sulekha Beevi C.S., Member (Judicial) and Shri M. Ajit Kumar, Member (Technical) observed that the period involved in the present appeal overlaps with the period for which the demand has been confirmed. While dismissing the appeal, the CESTAT held that the appellant is not eligible for a refund and upheld the impugned order.
The Bangalore bench of Customs, Excise and Services Tax Appellate Tribunal (CESTAT) sustained the demand of interest on differential duty only for the normal period. The bench allowed the appeal partially and modified the impugned order to the extent of confirming recovery of interest for the normal period.
The tribunal stated that as a result of a change in the law relating to the applicability of the statute of limitations for interest recovery that went into effect on April 8, 2011, the demand for interest can only be supported for the normal term. Additionally, since there is no suppression of fact, the bench refused to impose the penalty and it was warranted. H. Jayathirtha, Superintendent appeared as the Authorised Representative for the Respondent.
The Delhi Bench of Customs Excise and Services Tax Appellate Tribunal (CESTAT) has set aside the both service demand and penalty order imposed against the appellant by the department and observed that the service tax excess paid can be adjusted against the succeeding month or quarter.
The appellant is qualified to take advantage of the provisions of Rule 6 (4A) of the STR, 1994, according to the two-bench of Justice Dilip Gupta (President) and P. Anjali Kumar (Technical Member). Furthermore stated that neither the SCN nor the contested order contests the fact that the appellant has made good on the service tax shortfall they paid, along with interest.
The Bangalore Bench of Central Excise and Services Tax Appellate Tribunal (CESTAT) has set aside the service tax refund claim order and directed the adjudicating authority to re-adjudicate the case as there was no evidence or records were submitted to prove the availment of Cenvat Credit during Service Tax refund claim.
The Chennai Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that processing of beach sand minerals results to form processed ilmenite and it attracts 5% on Free On Board(FOB) value as per Customs Notification.
A two-member bench comprising Ms Sulekha Beevi C S, Member (Judicial) and Mr M Ajit Kumar, Member (Technical) held that “Ilmenite” exported by the appellant is rightly classifiable under CH 2614 00 20 of CTH as “Ilmenite upgraded (Beneficiated Ilmenite) and chargeable to appropriate export duty and not under 2614 00 10 of CTH. The authority allowed and set aside the impugned order.
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