This annual round-up analytically summarizes all the Customs, Excise and Service Tax Orders of the CESTAT Benches of India reported at Taxscan.in during 2024.
In a ruling, the Chennai Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that the Free Trade Area ( FTA ) benefit is applicable on the import of clear float glass (CFG) from Malaysia, and allowed the Basic Custom Duty (BCD) exemption.
The two member bench of Sulekha Beevi C.S. (Judicial Member) and Vasa Seshagiri Rao (Technical Member) has observed that the CFG is rightly classifiable under CTH 70051090 as identical imports of CFG were initially assessed provisionally in terms of Section 17 of the Customs Act, 1962. While allowing the appeal, the Tribunal held that Clear Float Glass is more appropriately classifiable under Customs Tariff Heading 7005-1090 of the Customs Tariff Act, 1975, and thus is eligible for exemption of the benefit of the exemption notification.
The Kolkata Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that interest not payable for intervening period when sufficient balance is maintained in CENVAT Credit Account.
The two member bench of Ashok Jindal (Judicial Member) and K. Anpazhakan (Technical Member) has observed that the appellant had sufficient balance in their CENVAT credit account during the intervening period when they had taken the excess credit. While allowing the appeal, the Tribunal held that since no demand is confirmed against the appellant, penalty is not imposable on the appellant.
The two member bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ), Chandigarh, has set aside the service tax demand imposed on services related to commercial and industrial construction services, noting that the appellant provided services to organizations not engaged in commerce, industry, or any other business or profession, and therefore, the extended period of limitation was not applicable.
The bench, consisting of Judicial Member S.S. Garg and Technical Member P. Anjani Kumar, found that the service provided by the appellant fell under the definition of Works Contract Service. This conclusion was based on a certificate from the Punjab Mandi Board dated April 9, 2013, which indicated that the work allotted to the appellant included the cost of materials, with no materials supplied by the Board itself. Consequently, the bench cited the Supreme Court’s judgment in Larsen and Toubro Ltd. v. State of Karnataka ruling that the appellant was not liable to pay service tax under Commercial or Industrial Construction Service, both before and after June 1, 2007.
In the case of IBM India Private Limited vs The Commissioner of Central Excise, the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) Bangalore, ruled in favor of the appellant, determining that Facility Management, Maintenance, and Consulting Services are not subject to service tax under the Management Consultancy classification.
The two member bench of the tribunal comprising D.M Misra ( Judicial member) and R. Bhagya Devi ( Technical member) noted that the services provided by M/s. IBM India Pvt. Ltd., including Availability Management, Batch Management, Capacity Planning, and other similar services, were indeed part of a broader suite of IT services. The classification of these services under ‘Management Consultancy Service’ was upheld as they were integral to managing IT infrastructure, contrary to the appellant’s claim of exemption under IT services.
In a recent judgment, the Chennai bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) has ruled that aircraft classified as engineering goods are eligible for excise duty exemption.
The two member bench of the tribunal comprising Vasa Sesha Giri Rao (Technical member) and Sulekha Beevi C.S (Judicial member) impugned order was set aside. The appeal was allowed, and the appellant was granted consequential relief, if applicable.
In a recent ruling, the Bangalore bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) has upheld a ₹1, 12, 86,898/- crores service tax demand for manpower recruitment and supply agency service along with an equal amount of penalty under Section 78 of the Finance Act. However, the demand for Business Auxiliary Service was set aside, along with interest and penalties.
The tribunal, comprising OM Misra (Judicial Member) and R. Bhagya Devi (Technical Member), observed that the appellant did not deny receiving services from their overseas company but argued that for the period prior to April 17, 2006, they were not liable to pay duty. For the period from April 18, 2006, to March 2007, the appellant contended that the definition of ‘Business Auxiliary Service’ did not include information technology services, and therefore, the demand for service tax under RCM for this period could not be sustained. The tribunal found no specific findings in the impugned order regarding this plea.
In a recent ruling, the Chandigarh bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) granted relief to Ambuja Cement by allowing Cenvat Credit adjustment for captively consumed clinker, acknowledging the appellants’ fair submission to the original authority to deduct the Cenvat credit availed on inputs used in clinker manufacturing during the period from the refund claimed.
The Tribunal, comprising S.S Garg (Judicial Member) and P. Anjani Kumar (Technical Member), held that the amounts paid during the appeal process should be treated as deposits under Section 35F, and therefore, the refunds should be processed according to CBEC/CBIC Circulars without applying Section 11B. The bench further ruled that even if unjust enrichment principles were applied, the appellants had rebutted this presumption with their evidence, and the revenue had not provided any contrary evidence. The appellants had already agreed that the Cenvat credit availed on inputs during the relevant period should be deducted from their refund claim.
In a significant ruling, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) Bengaluru Bench, has provided relief to Oracle India Pvt. Ltd., by holding that no service tax demand can be imposed for the period prior to the introduction of the relevant levy.
The CESTAT Bench of Judicial Member D M Misra and Technical Member R Bhagya Devi examined the arguments and the applicable law, concluding that the service tax could not be levied on transactions where the taxable event occurred before the introduction of the levy. The Tribunal emphasised that the contractual agreements, invoices, and payments were all completed before May 16, 2008, and the mere fact that the services extended beyond this date did not justify the imposition of service tax.
The Chandigarh Bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) recently ruled that the service tax is indeed chargeable on the gross commission, as per Section 67 of the Finance Act, 1994, which mandates that service tax is levied on the gross amount charged for the service provided loan arrangement services to bank are liable to service tax on gross commission CESTAT ruled that .
The Tribunal decision underlines the requirement to pay service tax on the gross commission received by DMAs from banks, disregarding any deductions made by the bank. This ruling underlines the strict interpretation of service tax provisions under the Finance Act, 1994, particularly Section 67, which is crucial for businesses involved in similar arrangements to note. This judgement reaffirms the principle that all components contributing to the gross amount payable for a service are subject to service tax, and any deviation from this can lead to significant tax liabilities, including interest and penalties.
The Chandigarh Bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) recently held that sale value is inclusive of freight outward for the purposes of assessing excise duty as the sales are made on a Free on Road ( FOR ) destination basis.
This ruling by the CESTAT bench underscores the principle that freight and insurance charges are part of the sale value for excise duty purposes when the goods are sold on a ‘FOR destination’ basis. The decision provides clarity for businesses on how freight outward costs should be treated in the context of excise duty, ensuring that the assessment reflects the true nature of the sale transaction.
The Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ), Ahmedabad Bench has recently ruled that oil present in the bunker tanks of a vessel’s engine room is to be considered part of the ship for the purpose of customs duty determination.
This decision reaffirmed that the oil in bunker tanks is not to be assessed separately but as an integral part of the ship being imported for demolition. The CESTAT ruling set aside the earlier lower authority orders and allowed the appeals, providing relief to the ship breaking industry by confirming the inclusive classification of such oil under the customs tariff heading applicable to the vessel.
The Ahmedabad bench of Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ), allowed the appeal and held that Aadat is nothing but a trade profit.
The bench was of the opinion that just because the term Aadat has been used for the purpose of margin, it does not make it a commission for any service. As a result, the requirement under Business Auxiliary Service that treats Aadat like a commission is unsustainable. The bench, comprising Ramesh Nair (Judicial Member) and C.L. Mahar (Technical Member), allowed the appeal in favor of the applicant, and the impugned order was set aside.
The Ahmedabad bench of Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) allowed the appeal in favor of the apeallant and held the commission deducted from the sale invoice of the appallant to the overseas buyer is not subject to service tax demands.
The bench, comprising Ramesh Nair (Judicial Member) and C.L. Mahar (Technical Member), allowed the appeal in favor of the applicant and directed to set aside the impugned order. The CESTAT bench held that the demand of service tax on the commission deducted in the sale invoice of the appellant to their foreign buyer cannot be charged to service tax.
The Ahmedabad bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT), allowed the appeal and held that service tax cannot be levied on clinical trials on drugs supplied by foreign client.
The bench held that service tax cannot be charged on the appellant as the activity of clinical trial on the drugs supplied by the foreign client to the appellant amounts to the export of service. The bench, comprising Ramesh Nair (Judicial Member) and C.L. Mahar (Technical Member), allowed the appeal in favor of the applicant and directed to set aside the impugned order.
In the recent case, the Chennai bench of Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) ruled that a service tax demand cannot be justified solely based on accounting entries presumed as consideration. The Tribunal set aside the demand, finding that service tax was wrongly imposed on a provision for warranty expenses already covered by taxed commission.
The bench found that the department failed to prove additional income beyond the commission, and the demand was based solely on accounting entries. AS-29 allows for provisions based on estimation, so no extra consideration was established. A coram of Sulekha Beevi C.S (Judicial Member) and Vasa Seshagiri Rao (Technical Member)set aside the demand, contending that the service tax was incorrectly levied on a provision for warranty expenses already covered by taxed commission. The appellant had not received separate consideration for maintenance and repair services.
The Ahmedabad Bench of the Customs Excise and Service Tax Appellate Tribunal (CESTAT) clarified on the taxability of the amount paid by an employee to an employer in exchange for vitiating the mandatory notice period to be served by the employee upon termination of employment.
The Coram of the Ahmedabad Bench of CESTAT comprising Ramesh Nair, Judicial Member and C.L. Mahar, Technical Member allowed the present Appeal in light of the aforementioned Decisions and held that the impugned order by the Revenue Department against the Appellant Assessee is not sustainable.
The Ahmedabad Bench of the Customs, Excise and Service Tax Appellate Tribunal in a recent matter granted relief to GAIL India Ltd. proclaiming that refund of Service Tax claimed cannot be rejected by Revenue Department if the Assessee has made adequate reparations to reimburse service tax amounts that were wrongly claimed by them from their customers.
The two-member Bench of the Ahmedabad CESTAT comprising Somesh Arora, Judicial Member and C.L. Mahar, Technical Member laid reference to the decision of the Mumbai Tribunal in Piramal Enterprises Limited vs. CST (2016), where it was observed that multiple financial adjustments can occur between two commercial enterprises that trade with each other; certain considerations may be transferred by way of credit notes and the same is permitted as per applicable law. The Tribunal further observed that the Appellant had not claimed CENVAT credit on the additional service tax paid by them on the additional service charge that was levied on the Appellant’s customers.
The Customs , Excise & Service Tax Appellate Tribunal (CESTAT) Ahmedabad Bench observed that as the Renting of Earth Moving Equipment to various clients is not a taxable services as it does not falls under supply of tangible goods and secondly, the service prior to 01.07.2012 and subsequent thereto it does not fall under the definition of input service.
The ITAT Bench comprising Ramesh Nair, Judicial Member and C.L Mahar, Technical Member observed that the appellant has given earth moving equipment on monthly rent basis to their lessee and the right to possession and use of earth moving equipment has been transferred to the lessee. So according to the above order it is clear that transaction of renting of Earth Moving Equipment to various clients firstly, does not fall under supply of tangible goods and secondly, the service prior to 01.07.2012 and subsequent thereto it does not fall under the definition of input service as mentioned above. Therefore, the activity of renting of Earth Moving Equipment to various clients is not a taxable service. Hence the impugned order is not sustainable, the same is set-aside and the appeal is allowed.
The Ahmedabad Bench of the Customs, Excises and Service Tax Appellate Tribunal ( CESTAT ) recently held that Activities rendered by Stem Cell/Umbilical Cord Blood Banks are not retrospectively exempt from Service Tax while upholding a Rs.2 Cr Service Tax Demand imposed by the Revenue Department on the Appellant.
In light of the findings, the West Zonal Bench of CESTAT, Ahmedabad Coram comprising Somesh Arora, Judicial Member and C.L. Mahar, Technical Member referred to the Decision of the Madras High Court in Life Cell Internation (P) Ltd. vs. Union of India (2015) and maintained that the Amendment to the Mega Exemption Notification cannot be attributed retrospective application to permit the Appellant to avail Service Tax Exemption. In conclusion, the Tribunal while dismissing the Appeal, adjudged that the Appellant Company is very much liable to pay Service Tax on the aforementioned period. The Tribunal further condemned the Appellant’s wilful default in payment of Service Tax, subjecting them to a violation of the limitation for non-filing of their returns.
In a significant relief to Hindustan Inox Limited and its directors, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has quashed the penalties imposed under Section 112(a) of the Customs Act, 1962. The penalties were initially imposed on the directors of the company by the Commissioner of Customs.
The CESTAT Bench of S.K. Mohanty, Member (Judicial) and M.M. Parthiban, Member (Technical) thus set aside the penalties imposed on the directors under Sections 112(a) and 114AA of the Customs Act, citing that the procedural misinterpretations and subsequent investigation did not involve any intentional violation of customs law. The Tribunal also referred to various judicial precedents that reaffirmed the importance of considering the intent and good faith of the appellants in cases involving procedural disputes.
The Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) has directed the Central Goods and Services Tax ( CGST ) Department to refund ₹28.3 lakh to Bank of Baroda. The refund pertains to the non-transitioned CENVAT credit of Krishi Kalyan Cess ( KKC ) that the bank could not transfer to the Goods and Services Tax ( GST ) regime via the TRAN-1 form.
The tribunal noted that CENVAT credit, which could not be transitioned under GST, must be refunded according to existing laws, even though the KKC itself was discontinued post-GST implementation. The order, issued by Dr. Suvendu Kumar Pati, Member ( Judicial ) of CESTAT, instructs the CGST department to process the refund within two months, along with applicable interest. In its ruling, CESTAT bench of Dr. Suvendu Kumar Pati, Member ( Judicial ) set aside the earlier decision of the Commissioner ( Appeals ) to reject the refund, stating that the unutilized credit of KKC must be refunded.
In a recent ruling, the West Bengal bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) held that the contract services for construction related to electricity transmission for Gujarat Energy Transmission Corporation Ltd. ( GETCO ) by the applicant are exempted from service tax.
The CESTAT bench held that the works contract services provided by the applicant to Gujarat Energy Transmission Corporation Ltd. (GETCO) for the activity of transmission of electricity are exempt from service tax. The bench, comprising of Ramesh Nair (Judicial) and C L Mahar (Technical), allowed the appeal filed by the appellant, Vraj Constructions, and the impugned order was set aside.
The Allahabad Bench of the Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) in a recent matter upheld the right of an Appellant to receive accrued Interest on Pre-Deposit amount deposited with the Appellate Authority to permit filing of Appeal, notwithstanding the Appellate Authority’s breach of accepting a pre-deposit amount higher than the statutorily permissible limit under Section 35F of the Central Excise Act, 1944.
Concludingly, the Judicial Member pronounced that accepting a pre-deposit in excess of the statutory limit of Ten Crore Rupees is a violation committed by the Adjudicating Authority; such acceptance does not absolve them of the liability to pay interest on the pre-deposit subsequent to disposal of the Appeal under Section 35FF of the Central Excise Act, 1944.
In a recent ruling, the Mumbai bench of the Customs Excise and Service Tax Appellate Tribunal (CESTAT) quashed the impugned order and the appellants’ Customs Broker license was restored.
The bench, comprising of S K Mohanty and M M Parthiban, directed to set aside the impugned order passed by the Commissioner of Customs (General), Mumbai, as it did not find any merit in revocation of the CB license of the appellants, for forfeiture of security deposit, and for imposition of penalty, as there was no violation of regulations 10(d) and 10(n) of the CBLR 2018. The bench allowed the appeal in favor of the appellants.
The Ahmedabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held in a recent case that liability to pay Service Tax cannot be levied on charges paid to Advertisement agencies by a Franchisor which are in fact, collected from the Franchisees by virtue of an Agreement executed between both Parties.
The 2-Member Bench of CESTAT, Ahmedabad comprising Ramesh Nair, Judicial Member and C.L. Mahar, Technical Member, after perusing the material and submissions made on record proceeded to follow the binding precedent set by the Apex Court in Intercontinental Consultants underlining the unconstitutionality of Rule 5(1). Additionally, the 2-Member Bench, while allowing the present Appeal held that even if Rule 5 was ignored by the Tribunal, the valuation of gross value is determined by Section 67 of the Finance Act, 1994.
In a recent ruling, the Mumbai bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) allowed the appeal in favor of the appellant Reliance Jio Infocomm Ltd.
The bench observed that there was no justification for ordering for recovery of interest on the amount determined as payable under Rule 6(3)(b) of the CCR 2004, since the appellant had CENVAT credit balances far exceeding amounts determined as payable. The bench held that in this case, service tax demand is not sustainable. The bench noted that We also note that the Commissioner was wrong in imposing a penalty on the appellants by invoking the provisions of Rule 15 of the CENVAT Credit Rules. This provision only applies in cases where CENVAT credit has been improperly obtained or used. The bench, comprising of S K Mohanty and M M Parthiban, allowed the appeal in favor of the appellant and set aside the impugned order.
In a recent ruling, the Mumbai bench of the Customs Excise and Service Tax Appellate Tribunal (CESTAT) allowed the appeal in favor of the assessee and held that the demand and penalty in the impugned order have no basis in law.
The bench observed that the box office represents a collaboration between the exhibitor and distributor. While not taxed itself, it incurs costs for services from both parties, including business support services for film screenings. It is also observed that the adjudicating authority overlooked the distributor’s essential role in this collaboration. The CESTAT bench, comprising Mr. Dilip Gupta and Mr. C J Mathew, held that the demand and penalty in the impugned order have no basis in law. The bench set aside the impugned order. The bench allowed the appeal in favor of the assessee.
The Customs, Excise & Service Tax Appellate Tribunal (CESTAT) Chennai Bench quashed the order demanding the service tax along with interest and imposed penalties under ‘Maintenance and Repair Services’. As the service tax cannot be imposed upon mere assumption and consideration of figures.
The CESTAT Bench composed of Vasa Seshagiri Rao, Member ( Technical ) and Sulekha Beevi.C.S, Member ( Judicial ) observed that Demand of service tax cannot be raised on mere book entries assuming such figures as consideration. Upon the facts, the court is convinced that the appellant has not received any separate consideration for providing maintenance and repair services during the warranty period. So the demand cannot be sustained and requires to be set aside, the tribunal noted. In result the impugned order was set aside and the appeal was allowed with consequential reliefs.
The Principal Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Delhi recently held that Processing Charges incurred in course of provision of services by medical service providers are encompassed within the ambit of ‘Healthcare Services’ and thereby exempted from Service Tax.
The Principal Bench of the Customs, Excise and Service Tax Appellate Tribunal, Delhi presided over by Binu Tamta, Judicial Member held that the Revenue Authorities have fallaciously declared the aforementioned series of services between Life Care Hospital and Life Care Medicos as “business auxiliary services” when it has been extensively established that they are services essential to the treatment of patients. Concludingly, CESTAT dropped the demand proceedings against the Appellant and set aside the Order while allowing the present appeal.
The Ahmedabad bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) has rejected the refund claim for interest on delayed payment due to post-clearance oil price variations, citing the pending Show Cause Notice and noting that there was no merit in the appellant’s claim, which was unsupported by the evidence and arguments presented.
The bench, consisting of Ramesh Nair ( Judicial Member ) and Raju ( Technical Member ), found the appellant’s claim misleading. They noted that the SVLDRS Scheme aimed to settle unpaid dues rather than refunding legally paid dues. As the show cause notice demanding interest was confirmed and settled under SVLDRS, the refund claim related to this interest could not be upheld. The tribunal also observed that addressing unjust enrichment was superfluous at this stage since the primary decision was that the refund was not admissible. The tribunal dismissed the appeal, finding no merit in the appellant’s claim for refund. The claim for refund was not supported by the evidence and arguments presented.
In a recent ruling, the Delhi bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) has directed the Customs Commissioner to issue a new order after reviewing the Assessing Officer’s detailed order concerning the evaluation of 18 aluminum scrap import bills.
A two-member bench consisting of Justice Dilip Gupta (President) and P.V. Subba Rao addressed the department’s presentation of speaking orders for the 18 Bills of Entry. The bench determined that, given the new information provided, the case should be remanded to the Commissioner (Appeals) for a fresh review. The Commissioner (Appeals) is instructed to reassess the case based on the speaking orders and issue a new decision.
The single bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) in Delhi, has upheld the Central Excise duty demand under Section 11A read with Section 174 of the CGST Act, 2017, due to a shortage of raw materials and finished goods, and has confirmed the liability for the associated penalty.
The Tribunal Comprising Binu Tamta (Judicial member) observed that the imposition of mandatory penalty under Section 11AC (1) (a) was justified for detected shortages, supported by Apex Court decisions emphasizing penalty for rule violations. The Tribunal affirmed the decision, dismissing the appeal. The Tribunal upheld the imposition of central excise duty and penalty for the shortage in stocks, with no grounds for interference in the impugned decision. The appeal was thus dismissed.
In a recent Judgement, the Delhi bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) has set aside the order that wrongly rejected the transaction value under Rule 8 of the Customs Valuation Rules, noting that there was no evidence of over-valuation of goods and no reasonable doubt about the truth or accuracy of the declared transaction value.
Therefore, the two member bench of the tribunal Dr Rachana Gupta ( Judicial member ) and P.V. Subba Rao ( Technical member ) set aside the impugned order, ruling that the declared value in the shipping bills should be accepted. As a result, the confiscation, fines, and penalties imposed were deemed unwarranted. Both appeals were allowed, and consequential relief was granted to M/s Universal Offset and Shri Vikas Gupta.
The Delhi bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) ruled that the transportation of goods for domestic and international trade is exempted from “Business Auxiliary Services” (BAS), and therefore no service tax demand can be made.
In a similar case (Greenwich Meridian Logistics Pvt Ltd.), the tribunal ruled that transactions involving the purchase and sale of shipping space do not fall within the scope of BAS, as they are principal-to-principal transactions, and no agency relationship exists. Considering the facts and prior rulings, the two member bench of the tribunal comprising Dr. Rachana Gupta (Judicial member) and Hemambika R. Priya (Technical member) found no justification for the service tax demand and set aside the impugned order. Consequently, all demands, interest, and penalties were nullified, and the department’s cross-objections were dismissed.
In a recent judgement, the Delhi bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) ruled that penalty or late delivery charges cannot be subjected to service tax under Section 66E of the Finance Act, 1994.
The bench, comprising Judicial Member Binu Tamta and Technical Member Hemambika R. Priya, reviewed the submissions and observed that the issue had been settled in previous rulings, such as the Tribunal’s decision in M/s South Eastern Coal Fields Ltd. The bench concluded that penalties and late delivery charges could not be subjected to service tax under Section 66E of the Finance Act, 1994. Accordingly, the impugned order dated 08.01.2019 was set aside, and the appeal was allowed.
The Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ), Ahmedabad Bench stated that Goods with Domestic Tariff Area ( DTA ) clearance, used for manufacturing of goods, cannot be denied the Excise Duty Exemptions.
The CESTAT Bench comprising Ramesh Nair, Judicial Member and CL Mahar, Technical Member observed that since there was no evidence to prove the manufacturing was done out of imported goods, the matter was remanded with specific directions to the Adjudicating Authority to establish the same. In the denovo adjudication, due to lack of evidence it came to the conclusion, i.e the goods were manufactured out of indigenous as well as imported raw materials.
The Bench also went through the SCN based on the allegations of manufacture of subject goods out of indigenous and imported raw material and finds that as bald and the same is not based on any evidence. Therefore, despite remand the matter to establish this fact, the Adjudicating Authority has decided the source of raw material only on the assumptions. Therefore, in these peculiar facts, the benefit of doubt clearly goes in favor of the appellant. So accordingly, in the absence of evidence to prove that the raw materials were used in the subject goods, the appellant cannot be denied exemption in respect of DTA clearances. In view of all, the court set-aside the impugned order and allowed the appeal.
In a recent decision, the Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) of Delhi has set aside a service tax demand against a consultant, ruling that the tax assessment was based solely on turnover information from income tax data that lacked proper investigation.
In the result, CESTAT set aside the service tax demand, stating that the department had not followed due diligence in the case. Thus the appeal filed was allowed, bringing relief to the consultancy firm.
The Delhi bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) has ruled in favor of M/s Raghuveer Concast Pvt. Ltd. and its Directors, Mr. Chand Singhal and Mr. Inder Mohan Singhal, allowing them to claim Cenvat credit for excise duty paid for mild steel scrap on strength of invoices issued by registered dealers
The tribunal, consisting of Justice Dilip Gupta ( President ) and P.V. Subba Rao ( Technical Member ), observed contradictions in the department’s stance. While accepting the existence of the dealers and manufacturers for purposes such as registration and notices, the department denied their existence when it came to Cenvat credit claims. The tribunal concluded that the impugned order was unsustainable due to these inconsistencies. Consequently, the tribunal set aside the impugned order and allowed the appeal, granting consequential relief to the appellant.
The Ahmedabad Bench of Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) quashed the excise duty demand and allowed the appeal in favor of the appellant.
The bench observed that the adjudicating authority has erred by violating the principles of natural justice, making the statement relied upon by the revenue inadmissible as evidence of clandestine removal. By virtue of Section 9D of the Central Excise Act, 1944. , it was mandatory to conduct cross-examination of the witness, and thus the third-party evidence is insufficient to prove clandestine removal. The CESTAT bench, comprising Ramesh Nair and C L Mahar, held that the demand would not be sustained as the revenue could not establish its case of clandestine removal. The appeal was allowed, and the impugned order was set aside.
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