This weekly round-up analytically summarizes the key stories related to the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) reported at Taxscan from 24 December 2024 to 27 December 2024.
In a recent ruling, the Bangalore bench of Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) has ruled that the online technical support rendered to M/s. Microsoft Corp., USA and Microsoft Mobile, Finland by Microsoft India are ‘Export of Service’ not Intermediary. It allowed CENVAT Cash refund of Rs. 16.8 crores.
Boost Your Business with SME IPO Funding Strategies – Enroll Now ,Click here
The two-member bench of D M Misra (Judicial) and Bhagya Devi ( Technical ) of the tribunal concluded that the appellant provided services directly to Microsoft Corp, received payment in convertible foreign exchange, and met the conditions for “export of services.” Consequently, the appellant is entitled to the refund of accumulated cenvat credit.
The Bangalore bench of the Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) has set aside the service tax demand as it is not applicable on training and coaching services provided outside India. The bench held that the appellants were exempt from paying service tax since the training and coaching services were provided outside of India, since this is not covered by Rule 3(1)(ii) of the Rules.
In various decisions the Tribunal held that there cannot be any Service Tax on technical know-how. The CESTAT held that the appellants were exempt from paying service tax since the training and coaching services were provided outside of India, since this is not covered by Rule 3(1)(ii) of the Rules. The bench set aside the impugned order and allowed the appeal.
In a ruling in favour of Intel Technology Ltd, the Bangalore bench of the Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) ruled that conversion of drawback shipping bills to DFIA shipping bills is allowable as there is no time limit mentioned under Section 149 of the Customs Act, 1962.
Boost Your Business with SME IPO Funding Strategies – Enroll Now ,Click here
It was viewed that the appellant is legally entitled for conversion of Drawback Shipping Bills to DFIA Shipping Bills in respect of 184 Shipping Bills as per the list provided in appeal along with the appeal memo. The respondent Commissioner is directed to issue necessary certificate enabling appellant to get the DFIA licenses revalidated.
The Ahmedabad Bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) granted a refund of pre-GST CENVAT credit. It ruled that Rule 9(1)(bb) of the CENVAT Credit Rules, 2004, was inapplicable to payments made under the reverse charge mechanism ( RCM ) since such payments were not based on supplementary invoices.
The tribunal held that the appellant was eligible for the refund and set aside the Commissioner’s order citing it was beyond the scope of the show cause notice and the order-in-original. The appellant’s appeal was allowed.
The Ahmedabad Bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) held that employees of principal manufacturers cannot be penalized for excise duty-related lapses by job workers unless there is direct involvement.
Boost Your Business with SME IPO Funding Strategies – Enroll Now ,Click here
The tribunal explained that the confusion regarding duty liability at the time was genuine and that the transactions conducted by Paras Trading Company were legitimate and documented. The tribunal also found no evidence of any mala fide intention by the job worker.
The Mumbai bench of Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ), on denial of CENVAT Credit to Ambuja Cements, recently observed that long adjournment during pandemic could have ensured justice.
CESTAT concluded that the principles of natural justice were not upheld in this case. It allowed the appeal by remanding the matter for fresh adjudication, setting aside the previous order.
The Bangalore bench of the Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) held that credit lying in stock on Returned goods had to be reversed in terms of SSI Notification read with Rule 11 of Cenvat Credit Rules, 2004( CCR ). The bench upheld the impugned order confirming the demand of cenvat credit of Rs.3,47,656/- and education Cess of Rs.6,953/- under Section 11A of the Central Excise Act, 1944 along with interest.
While dismissing the appeal, the bench upheld the impugned order confirming the demand of cenvat credit of Rs.3,47,656/- and education Cess of Rs.6,953/- under Section 11A of the Central Excise Act, 1944 along with interest.
The Bangalore bench of the Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) allowed Bharat Sanchar Nigam Limited ( BSNL ) to avail cenvat credit of service tax paid by private operators on interconnectivity usage charges.
Boost Your Business with SME IPO Funding Strategies – Enroll Now ,Click here
The Tribunal viewed that there has not been any utilisation of credit involved because of the entire credit taken at one location was taken in one office making it easy for Revenue to conduct verification as may be necessary. The argument of the appellants that the premises where the equipments are used belong to BSNL and not to any other party and it is also used for completion of services originating from Salem also are strong arguments in favour of the appellants.
The Ahmedabad Bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) classified Siapton 10L and Isabion as fertilizers under Central Excise Tariff Item No. 3101 00 99, citing their primary nutrient-based composition.
The tribunal held that bio-stimulants were fertilizers under Tariff Item No. 3101 00 99 because they were nutrient providers. It further analyzed the Fertilizer Control Order amendment in 2021, which categorized bio-stimulants as fertilizers.
The Tribunal set aside the excise duty demands under Tariff Item No. 3808 93 40 and ruled that the Revenue’s classification was incorrect. The appellant’s appeals were allowed with granting relief.
The Bangalore Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) ruled that service tax refund claims are non-maintainable unless the underlying assessment order or classification is first challenged.
Boost Your Business with SME IPO Funding Strategies – Enroll Now ,Click here
The tribunal pointed out that refund claims are like execution proceedings and cannot substitute for an appeal or review of an assessment order. It explained that once an assessment order stands, the duty is payable as per that order unless successfully challenged through proper appellate mechanisms. The appellant’s appeal was dismissed.
The Chennai Bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) ruled that Chettinad Builders Private Limited ( CBPL ) was a “related party” as the appellant failed to prove it an “associate” under the Central Excise Act, 1944. It upheld the differential duty demands imposed on the appellant.
The tribunal rejected the appellant’s claim about AS 18 and pricing issues. Considering that the appellant failed to prove that the CBPL was not a related party but an associate, the tribunal dismissed the appeal of the Chettinad Cement and held that the excise duty calculation was correct.
The Chennai Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) held that connectors imported for use in Printed Circuit Board Assemblies (PCBAs) of mobile phones were correctly classified under CTH 85177090. The tribunal allowed the Basic Customs Duty (BCD) exemption under Sl. No. 6A of Notification No. 57/2017-Cus.
The two-member bench, comprising P. Dinesha (Judicial Member) and Vasa Seshagiri Rao (Technical Member) observed that the department had already accepted the earlier favorable order without challenging it which showed inconsistency in their argument. It observed that the appellant’s alternative claim under Notification No. 57/2017-Cus had merit, as the connectors qualified as parts or inputs of PCBA.
The Customs Excise & Service Tax Appellate Tribunal (CESTAT) has held that loading and unloading cement does not fall under ‘Clearing and Forwarding Agent’ services. The bench set aside the impugned order and allowed the Appeal.
Boost Your Business with SME IPO Funding Strategies – Enroll Now ,Click here
A division P. A. Augustian (Judicial) and Mr. Pullela Nageswara Rao, Member (Technical), viewed that the loading and unloading cement does not fall under ‘Clearing and Forwarding Agent’ services. The bench set aside the impugned order and allowed the Appeal.
The Ahmedabad bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) ruled that the cost of parts supplied by the principal manufacturer is excluded from the job worker’s assessable value citing the principal manufacturer clears the final products on payment of duty.
The tribunal set aside the impugned order and ruled that the cost of parts supplied by the principal manufacturer is not includible in the assessable value of goods manufactured by the job worker. The appellant’s appeal was allowed.
The Ahmedabad Bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) ruled that an employee cannot be held liable for a company’s inadvertent error in claiming CENVAT credit unless malafide intent was proven
Boost Your Business with SME IPO Funding Strategies – Enroll Now ,Click here
So, the tribunal ruled that penalties under Rule 26 of the Central Excise Rules, 2002 cannot be used in cases of inadvertent errors without malafide intent. The tribunal explained that penal action against an employee for a corporate error especially when the company was not found guilty of misconduct was unsustainable.
The Allahabad Bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) remanded BSNL’s CENVAT credit claims for re-verification focusing on allegations of double credit availed for the same supply of goods or services.
The tribunal remanded the issue to the original adjudicating authority, directing a thorough re-verification of the appellant’s claims with supporting documentation. The tribunal also invoked Section 80 of the Finance Act, 1994, to waive penalties, considering the appellant company’s status as a public sector undertaking and the absence of malafide intent.
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
