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 November 22 to November 27, 2021.
Indian Oil Corporation Limited Vs. C.C.E. & ST
The Indian Oil Corporation Limited (IOCL) has received a relief from the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Ahmedabad bench wherein the Tribunal directed the Revenue to re-consider their claim of refund by granting an opportunity to the appellants to pursue their claim by rectifying the errors in the assessment under section 154 of the Customs Act, 1962.
M/s Prabhu Shipping Systems Vs. Commissioner of Customs
The Chennai Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) upheld the Revocation of Customs Broker’s License on failure to produce KYC documents of exporter at any stage of inquiry. The coram headed by the President, Justice Dilip Gupta and Technical Member, P.V.Subba Rao while upholding the impugned order noted that the appellant had no idea who the exporter was. Its employee, Shri Kadam, also had no contact with the exporter. The appellant or its employee has not conducted any due diligence measures. They claimed to have obtained KYC documents through email but have failed to produce them either before the Inquiry officer or at any stage. The irresistible conclusion can only be that they have no such documents and also no idea of who the exporter was and simply filed a Shipping Bill heavily over-invoicing the goods.
M/s. Trading Syndicate Vs. Commissioner of Customs
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT) while quashing the enhancement of assessable value and imposition of redemption fine in lieu of confiscation held that Price quoted in Proforma invoice can’t be Actual Price as it is settled after negotiation. The coram of Judicial Member, P.K.Choudhary and Technical Member, Raju ruled that in the course of enquiry, a proforma invoice was recovered showing a different price from that as shown in the invoice submitted at the time of import. However, it is observed that the proforma invoice is not issued in the name of the appellant. Otherwise also the price quoted in a proforma invoice cannot be held as the actual price since the price of goods are settled after negotiation between the two parties. The Revenue has not produced any document to prove that there was any extra payment made by the appellant towards purchase of the said goods.
Nava Bharat Ventures Limited Vs. Commissioner of Central Excise, Customs and Service Tax
The Hyderabad Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) quashed the penalty as no demand was made in Show Cause Notice for alleged wrongful availment of CENVAT credit. The coram headed by President Justice Dilip Gupta and Technical Member, P.V. Subba Rao held that Rule 15 provides for the imposition of a penalty if CENVAT credit has been wrongly availed which allegation must be made in the show cause notice with a proposal to recover such wrongly availed CENVAT credit under Rule 14 but such a demand has not been made. Instead, a demand of an amount equal to 8%/ 10% of the exempted goods under Rule 6(3) has been made in the show cause notice, which is only an option to the assessee and cannot be demanded under Rule 14. Since the show cause notice itself has been issued without authority of law, any penalty imposed in the impugned order in pursuance of it needs to be set aside too.
M/s Apex International Vs. Commissioner of Customs
The Kolkata Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) allowed the Provincial Release of Goods Detained on execution of bond and bank guarantee. The coram of Judicial Member, P.K.Choudhary directed the appellants to execute the bond backed by the Bank Guarantee. On execution of bond and bank guarantee, the Adjudicating Authority shall grant the provisional release of the consignment. The Tribunal further directed that the quantum of bond should be sufficient enough to cover the duty, redemption fine and penalty likely to be imposed during the adjudication taking into consideration the various circulars issued by the CBEC.
M/s Varun Beverages Limited Vs. Commissioner, Central Excise
The Allahabad Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) held that Nimbooz was classified under the category of fruit juice-based drinks and not Lemonade so no GST payable. The coram of Judicial Member, Anil Choudhary, and Technical Member, P. Anjani Kumar while upholding the decision of the larger bench held that these goods under dispute are classifiable under tariff item No. 22029020. The appellant is entitled to consequential benefits, in accordance with the law.
Vaibhav Auto Industries Vs. Commissioner of Central Excise
The Ahmedabad Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) remands the matter of Clandestine removal of Chhakada back to Excise Authority as cross-examination was not allowed. “It is clear that the Adjudicating Authority has not followed the principles of natural justice as much as the cross-examination was not allowed. We, therefore, following the above decision of the Tribunal, set-aside the impugned order and remand the matter to the Adjudicating Authority for passing a fresh order, considering the observations made by this Tribunal in the above referred order dated May 1, 2014. The appeals are disposed of by way of remand to the Adjudicating Authority,” the CESTAT ruled.
Synthokem Labs Pvt. Ltd. Vs Commissioner of Central Tax
The Hyderabad Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held that penalty cannot be imposed for mere wrong apportionment of CENVAT Credit between two units as it is just a clerical error. “When the facts are known to both the parties, omission by one party to do what he might have done would not render it suppression. Above all, suppression of facts is clearly qualified by word wilful in the section. Hence, presence of mensrea to evade duty has to be there. From the facts as discussed above since there has been prompt reversal by the appellant that too of a such amount which was meant for the appellants own both units, however was utilised only by one unit. Hence allegation of wilful mis- statement with an intent to evade payment rather not at all justified. Though the adjudicating authority below had been right while dropping the demand on the same ground by holding it to be mere clerical error, they have definitely got wrong while still imposing penalty. The order accordingly is hereby set aside,” the CESTAT ruled.
M/s ACC Limited Vs. Commissioner of GST
The Chennai Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) allows Excise Duty Refund as amount was paid under protest during pendency of litigation and was not time-barred. The coram of Judicial Member, Sulekha Bevi C.S. noted that the litigation with regard to the demand raised in the Show Cause Notice dated 06.08.2009 has continued till 27.02.2018 whereby the Commissioner (Appeals), Coimbatore has set aside the demand, interest and penalties confirmed in the Order-in-Original. Though after the first adjudication and consequent appeal (whereby the demand was set aside), the appellant ought to have filed the refund claim within a period of one year, since the Department has adjudicated the Show Cause Notice for a second time and confirmed the demand again, it cannot be said that the refund claim filed by the appellant is time-barred. In fact, the refund claim is filed within one month after passing of the second Order-in-Appeal which is dated 27.02.2018.
M/s Insecticides India Ltd. Vs. Commissioner CG & ST
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chandigarh Bench held that the CESTAT’s Order allowing refund claims for Education Cess attained Finality as Revenue failed to Challenge before Higher Authority. The coram of Judicial Member, Ashok Jindal ruled that earlier orders of this Tribunal have been accepted by the Revenue and no appeal has been filed against those orders. In the absence of any challenge to the orders of this Tribunal, the adjudicating authority was duty-bound to implement the orders of this Tribunal which they failed to do so. Further, in the earlier round of litigation, the orders of this Tribunal were final.
Bochasanwasi Shri Aksharpurushottam Swaminarayan Sanstha Vs. C.C.
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Ahmedabad Bench ruled that the CESTAT is not empowered to allow Interest on Interest for delayed payment of Customs refunds in absence of statutory provision. The Coram of Judicial Member Ramesh Nair and Technical Member P.Anjani Kumar M held that this Tribunal being a creature under the statute of customs Act cannot decide anything beyond the provisions of the statute of the Customs Act. There is no statutory provision for granting the interest on interest. Therefore, the decision on this issue by the Learned Commissioner (Appeals) is legal and correct.
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