CESTAT Weekly Round-Up

This weekly round-up analytically summarizes the key stories related to the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) reported at Taxscan.in during the previous week from June 18 to June 24, 2022.

DKNV Engineering Pvt Ltd vs Commissioner of Central Excise & ST- 2022 TAXSCAN (CESTAT) 336

The Ahmedabad bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that the cenvat credit cannot be denied for mere procedural lapse of submitting photocopies of the invoices. The Tribunal held that “availment of credit on the strength of photocopies of the invoices is just a procedural lapse and cannot be made the basis to disallow the credit. For this reason, in the absence of any evidence that the appellant had not received the goods, credit cannot be denied.

Tega Industries Limited vs C.C.E. & S.T - 2022 TAXSCAN (CESTAT) 334

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Ahmedabad bench has held that for the purpose of refund of the central excise duty, a unit located in a Special Economic Zone (SEZ) shall be treated as a distinct entity for the purpose of Central Excise Act, 1944. Mr Ramesh Nair (Judicial Member) has allowed the claim of the assessee by holding that the service is not included in the approved list the refund cannot be denied.

M/s.Vestas Technology R&DChennai Private Ltd vs Commissioner of GST & CE- 2022 TAXSCAN (CESTAT) 333

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Chennai bench have held that the limitation period on CENVAT refund claim can only calculate based on dates of realisation of export proceeds and filing of refund and ordered to submit the relevant documents for that.

Lonsen Kiri Chemical Industries Limited vs Commissioner of Central Excise & ST - 2022 TAXSCAN (CESTAT) 335

While quashing an additional demand of interest by the Customs department, the Ahmedabad bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that the demand is not sustainable in view of the fact that the importer, a 100% EOU has cleared the goods after payment of customs duty along with interest.

M/s. Vandana Global Ltd vs Commissioner of Central Excise and Service Tax - 2022 TAXSCAN (CESTAT) 337

In a significant ruling, the Delhi bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that imposition of penalty under the CENVAT Credit rule will not sustainable in the absence of suppression of fact. The Tribunal observed that Show Cause Notice on this issue was served many years back and is repeatedly being served for the subsequent periods, suppression of facts cannot be alleged and the extended period was wrongly being invoked by the department.

Atul Madhavji Parekh vs C.C.E. & S.T.-Daman - 2022 TAXSCAN (CESTAT) 338

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Ahmedabad bench has held that penalty under rule 26 will not sustain in the absence of actual clearance of goods. Mr Ramesh Nair, Judicial Member observed that the contention of the revenue is not sustainable regarding the charge of issuance of invoices without actual clearance of goods for which the appellant has imposed penalty under Rule 26.

CESTAT vs Commissioner of Customs - 2022 TAXSCAN (CESTAT) 341

The Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ), New Delhi has held that Clerical error in filling the Bill of Entry does not attract penalty and confiscation under Customs Act. The Coram of Mr. Anil Choudhary, Member (Judicial) has observed that as the appellant has suo-moto approached the Department for making necessary rectification in the Bill of Entry about the classification, and also offered to pay the differential duty. Such suo-motu offer was made before the Department pointed out or issue any notice to the appellant.

Balkrishna Textiles Pvt Ltd vs C.C.E. - 2022 TAXSCAN (CESTAT) 340

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT) Ahmedabad bench presided by Mr. Ramesh Nair, Member (Judicial) and Mr. Raju, Member (Technical) has held that limitation cannot start to run unless the right to receive a claim or refund crystallized and set-asides order rejecting refund claim.

Acmechem Ltd vs Commissioner of Customs - 2022 TAXSCAN (CESTAT) 339

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Mumbai bench has held that no revaluation without further investigation and evidence in contrary since invoice of the manufacturer is sufficient to establish ‘transaction value’. The Tribunal observed that the invoice of the manufacturer is sufficient to establish the value therein to be the ‘transaction value’ The credibility of the impugned transaction, being one between the manufacturer and the appellant, should not have been called into question on the foundation of a stray bill of entry alone without further investigation and evidence.

Steel & Metals Co vs C.C.E. & S.T.-Vapi - 2022 TAXSCAN (CESTAT) 345

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Mumbai bench has held that issuance of invoices without movement of goods resulted in the confiscation and upheld the penalty. It was observed that Rule 26 of the Central Excise Rules applies to any person who acquires possession of or in any way concerned in transporting, removing, depositing, keeping, concealing, selling or purchasing or in any other manner deals with any excisable goods which are liable to confiscation.

Bhilosa Industries Pvt Ltd vs C.C.E. & S.T.-Daman - 2022 TAXSCAN (CESTAT) 344

The Ahmedabad bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) allowed the refund claim filed after the expiry of 3 months along with interest u/s 11BB of Central Excise Act,1994. The Tribunal observed that if the refund was granted after the expiry of the period of three months from the date of receipt of the application, then interest would also be payable on the amount of refund granted, from the date immediately after the expiry of three months from the date of receipt of the application, till the date of refund.

Yara Fertilizers India Private Limited vs Commissioner of Customs (NS-V) - 2022 TAXSCAN (CESTAT) 342

Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Mumbai grants interim relief to Yara Fertilizers India and classifies yaravita zintrac under Customs Tariff Act. C J Mathew, Technical Member and Ajay Sharma, Judicial Member held that “ Products in packed form are assigned special enumeration within heading 3105 of First Schedule to Customs Tariff Act, 1975 besides ‘other fertilizers’ as a residuary enumeration and it is on the appropriateness of this tariff item that the dispute revolves.

INDIAN OIL CORPORATION LTD vs C.C.E. & S.T - 2022 TAXSCAN (CESTAT) 343

In a significant ruling, in favour of Indian Oil Corporation, the Ahmedabad bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that in absence of violation of the rule to evade tax will not invoke penalty under Rule 173Q and quashed the penalty. Judicial member Mr Ramesh Nair and Technical Member Mr Raju set aside the penalty and held that “no penalty is imposable upon the appellant under Rule 173Q of the Central Excise Rules 1944 as the applicant has not violated any Rules/provisions with an intention to evade payment of duty”.

Anjaleem Enterprise P Ltd vs C.C.E. & S.T - 2022 TAXSCAN (CESTAT) 350

The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Ahmedabad held that period of depreciation should extend up to the date of payment of duty. It was observed that the tribunal held that duty was payable by the Appellant. However, in the calculation of duty, the Assistant Commissioner had erred in allowing depreciation only up to July 1994 when permission for de-bonding was granted by the Ministry of Industry and directed that depreciation should be allowed till the date of payment of duty. The Tribunal by said order upheld the setting aside of the interest.

Ssb Facility Management Service Pvt Ltd vs C.C.E. & S.T.-Surat-I - 2022 TAXSCAN (CESTAT) 347

Service Tax cannot be imposed on value of material supplied to client, so was held by Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Ahmedabad. Ramesh Nair, Judicial Member and Raju Technical Member held that “Ongoing through the grounds of appeals we find that the appellant’s submission in the defence is that department has gravely erred in not allowing exemption and deduction claimed while arriving at final taxable value. The demand of Service tax on material value supplied to the client during the impugned period was not justifiable.

RAJHANS IMPEX PVT LTD vs C.C.-MUNDRA - 2022 TAXSCAN (CESTAT) 351

The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Ahmedabad set aside the demand for excise duty due to the failure of revenue in establishing the clandestine clearance. It was observed that once in the 100% EOU the raw material imported duty-free and used in the manufacture of the final product and the final product is cleared on payment of duty in DTA, the customs duty on the raw material cannot be demanded.

M/s T.S. Motors India Private Ltd vs Commissioner of CGST & Central Excise - 2022 TAXSCAN (CESTAT) 346

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Allahabad comprising Justice Dilip Gupta, president and Mr Raju, technical member has held that an extended period of limitation can be invoked only on wilful suppression to evade payment of service tax. The Tribunal observed that the show-cause notice failed to mention that suppression was with an intention to evade payment of service tax. The Tribunal set aside the penalty and allowed the appeal.

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