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 October 21 to October 28, 2022. The Customs, Excise and Service Tax Appellate
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Mumbai set aside re assessment of imported goods thereby granting relief to Bharti Airtel. A Division Bench consisting of Sanjiv Srivastava, Technical Member and Ajay Sharma, Judicial Member observed that “In the present case, ‘Antenna’ being a part of the BTS, hence applying the said Rule, classifiable under Chapter Heading 8517. Revenue’s interpretation of the saidclause (a) in the present case is that in the event if the goods are not falling under any of the sub-heading of Heading 8517, then only it will be classifiable as ‘parts’, is incorrect.”
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Ahmedabad set aside service tax demand on no proof for Manpower Recruitment and Supply Agency Service. A Division Bench consisting of Ramesh Nair, Judicial Member and Raju, Technical Member observed that “There is no specific mention about the deployment of labour/workforce, the services provided by the appellant should not fall under the taxable category of manpower recruitment or supply agency service. Thus, under the facts and circumstances of this case, it cannot be said that the appellant had provided the Manpower Recruitment and Supply Agency Service. Hence, we are of the considered view that the service tax demands confirmed on the appellant cannot be sustained.”
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Kolkata Bench set aside demand of Rs 34,556 on the ground that Transport charges not taxable service as not provided by goods transport agency. The Bench consisting of P K Chaudhary, Judicial Member held that “I find that the Appellant has all along taken the view that the service is not taxable service as it was not provided by the goods transport agency, but by goods transport operator and/or individual truck owners namely an individual either owning or operating. In view of the above discussion, the impugned orders are set aside.”
The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Ahmedabad Bench has recently, in an appeal filed before it, held that no fine or penalty can be imposed when the goods in question are not liable for tax imposition or confiscation. Finally, allowing the assessee’s appeal with consequential relief, the Tribunal held: “Since no duty was payable on the said goods and since the said goods are not liable to confiscation, the imposition of fine and penalties on appellants are liable to be set aside. we are of the considered view that the impugned order is not sustainable, hence the same is set aside.”
In a significant ruling, the Kolkata bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT)ruled that the process of manufacture consisting of blending, bottling, and packaging of Indian-made foreign liquor is not taxable under the head of Business Auxiliary Service. The Tribunal found no reasons to interfere with the original order and while dismissing the appeal filed by Revenue, held that “the process of manufacture consisting of blending, bottling, and packaging of Indian-made foreign liquor is covered under Section 2(f) of the Central Excise Act, 1944, and is excluded from the purview of Business Auxiliary service under Section 65(19) of the Finance Act, 1994.”
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), set aside denial of refund on non-invocation of Rule 14 of Cenvat Credit Rules, 2004. The bench consisting of C J Mathew, Technical Member held that “The order of the original authority, goes a step further and, after questioning the eligibility for inclusion of the tax paid on the impugned services, has set aside the availment of CENVAT credit to that extent. The specific authority for doing so arises only from rule 14 of CENVAT Credit Rules, 2004 which has not been invoked in these proceedings. “
The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Ahmedabad Bench, has recently while considering two appeals filed before it, held that reversal of credit amounts to non-taking of credit, and hence that the benefit of the notification granting exemption has to be given.
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Ahmedabad held that amendment in Bill of Entry to be allowed on basis of documentary evidence in existence when goods were cleared, deposited or exported. A Bench consisting of Ramesh Nair, Judicial Member and Raju, Technical Member held that “From the above, it can be seen that as far as Section 149 is concerned, amendment is to be allowed on the basis of documentary evidence which was in existence at the time when the goods were cleared, deposited or exported. we are of the considered view that the impugned order is not sustainable in law and is set aside by allowing the appeal of the appellant with the direction to the assessing officers / original authority that the request of the appellant for reassessment be considered for amendment of Bill of Entry and appropriate order be passed in accordance with law after giving an opportunity of hearing to the appellant.”
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Ahmedabad allowed benefit of deemed conclusion of proceedings as on duty payment along with interest and penalty. The Bench consisting of Ramesh Nair, Judicial Member and Raju, Technical Member held that “It is admitted facts in present matter that the appellant herein has made the duty payment along with interest and penalty. There is grave infirmity, as observed above, in the impugned Order under challenge. Resultantly, we hereby set aside impugned order under challenge extending the benefit of deemed conclusion of the proceedings in view of Section 28 of the Customs Act to the appellants herein for the reason that they have complied with the conditions mentioned in the provision.”
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chandigarh lashed out on non-remittance of pre deposit. The Bench consisting of P V Subba Rao, Technical Member and Ajay Sharma, Judicial Member observed that “When a person has no respect for the order of the highest Court of the land then what to talk of the Tribunal. Such persons don’t deserve any leniency. The intentions of the appellant were very clear since the very first day when this Tribunal has passed the order of pre-deposit on 03.06.2011.”
The Hyderabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that duty exemption under notification no.No.12/2012-CE also applicable to sub-contractors who have not directly participated in the ICB. A Coram of Mr Anil Choudhary, member(judicial) Mr P V Subba Rao member (technical) observed that the Joint Secretary, TRU-1 have also issued clarification dt.10.07.2014, clarifying that the exemption is available also to sub-contractors who have not directly participated in the ICB. The Tribunal while allowing the appeal, has set aside the impugned order.
The Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held that Penalty u/s114AA of the Customs Act,1962 is not imposable in the absence of false information provided deliberately and intentionally by the assessee. Dr Rachna Gupta, member(judicial) observed that the findings of the Adjudicating Authority are held to be in total ignorance of the documentary as well as oral evidence on record. It stands clear that the appellant has deliberately and intentionally not provided any such information which was false or incorrect. As such, in my opinion, that penalty under section 114AA of the Customs Act, 1962 has wrongly been imposed upon him.
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Ahmedabad ruled that Challan through which service tax was paid is valid document for availing cenvat credit. “The cenvat credit was denied to the appellant on the ground that the service tax was paid by the appellant as a recipient whereas, it was supposed to be paid by the service provider. In this regard, I find that there is no specific condition in the Cenvat Credit Rules that the cenvat credit can be allowed only when service tax is paid by the service provider.” “In my considered view the appellant have rightly availed the cenvat credit in respect of service tax paid by them on receipt and use of service” the Tribunal ruled.
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Ahmedabad Bench asked Central Board of Indirect Taxes and Customs (CBIC) to issue proper guideline as to what stand to be taken in case where Insolvency and Bankruptcy Code (IBC) proceedings is in progress before National Company Law Tribunal or National Company Law Appellate Tribunal (NCLT/NCLAT).
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Ahmedabad confirmed penalty under Section 11AC of Central Excise Act, 1944 as there was short payment of duty amounting to 21 lakhs. A Coram consisting of Ramesh Nair, Judicial Member held that “The appellant was well aware that the duty due on the stock was required to be paid for debonding of the EOU. Though, the appellant have paid the duty on the stock as on 03.01.2008 but knowing that some goods were lying from 03.01.2008 to 28.01.2008 but have not paid the duty. Therefore, even though they paid on pointing out by the audit and despite the show cause notice covers period of one year, they clearly fall under four corners of Section 11AC accordingly, the penalty was rightly imposed under Section 11AC of the Central Excise Act, 1944 on the appellant.”
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Ahmedabad Bench granted remission of duty on finished goods destroyed in fire incident, thereby granting relief to Bajaj Herbals. A Single Bench consisting of Ramesh Nair, Judicial Member observed that “As per my above discussion and findings, I find that the appellant’s case is clearly covered under the four corners of Rule 21 of Central Excise Rules, 2002 and the appellant is clearly eligible for remission of duty on the finished goods destroyed in fire incident.”
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Ahmedabad confirmed penalty under Section 11AC of Central Excise Act, 1944 as there was short payment of duty amounting to 21 lakhs. A Coram consisting of Ramesh Nair, Judicial Member held that “The appellant was well aware that the duty due on the stock was required to be paid for debonding of the EOU. Though, the appellant have paid the duty on the stock as on 03.01.2008 but knowing that some goods were lying from 03.01.2008 to 28.01.2008 but have not paid the duty. Therefore, even though they paid on pointing out by the audit and despite the show cause notice covers period of one year, they clearly fall under four corners of Section 11AC accordingly, the penalty was rightly imposed under Section 11AC of the Central Excise Act, 1944 on the appellant.”
The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Ahmedabad denied a refund of Service Tax and the interest paid as there was no maintenance or repair of computers, computer systems, or computer peripherals. A Coram consisting of Ramesh Nair, Judicial Member, and Raju, Technical Member observed that “It is seen that the Notification No. 20/2003-ST provides exemption on;y to maintenance or repair of computers, computer systems or computer peripherals. The AVETCS systems can by no means be called computers, computer systems, or computer peripherals. The mere fact that the AVETCS contains a computer system does not make it Computer, Computer System, or Computer Peripherals. In these circumstances, we do not find the appellant is entitled to the benefit of Notification No. 20/2003-ST and consequently, the appeal is dismissed.”
The Customs, Excise & Service Tax Appellate Tribunal (CESTAT) of Delhi has held that Dismissal of appeal merely because of Application filed for SVLDRS and withdrawn subsequently is not valid. A Coram of single member Shri Ajay Sharma, member (judicial) observed that unless the tax dues as pointed out by the Designated Committee have been paid by the applicant under the said scheme, the issue cannot be said to have been settled. Further viewed that without looking into it merely on applying under SVLDRS, the Commissioner (Appeals) erred in dismissing the Appeal as deemed to have withdrawn.
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Ahmedabad granted benefit of Abatement as there was exact proof for purchase of some raw materials however exact quantum of the same may not be ascertainable. A Coram consisting of Ramesh Nair, Judicial Member and Raju, Technical Member observed that “It is apparent that the appellant has purchased of some raw materials however exact quantum of the same may not be ascertainable. Notification No. 15/2004-ST or for that matter 01/2006-ST, does not require proof of purchase of raw material to the extent of the abatement. “
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT) quashed Penalty on ground of Order deleting Proceedings against Co-Notices become Final as there was Penalty for Excise Duty Default. The appeal has been preferred by M/s. Ultramix Computer Support System Appellant Pvt. Ltd. The Bench consisting of Sanjiv Srivastava, Technical Member and Ajay Sharma, Judicial Member observed that “It is also not in dispute that the no appeal against this order dated 09.01.2002 was filed by the revenue and other co-noticee in the show cause notice i.e. Jayant Shirwadkar and Mrs H S Shirwadkar. In result the proceedings against these two co- noticees have become final and cannot be reopened by the Commissioner in de-novo proceedings as per the order of tribunal remanding the matter back to original authority in the appeals filed by M/s UCSSPL and Shrikant Shirwadkar.”
The Chennai bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has ruled that remand of matter on non-imposition of Penalty serves sufficient chance to put forward documents and evidence afresh. On perusal of the impugned order, A Coram consisting of single member Ms Sulekha Beevi C.S viewed the Commissioner (Appeals) had only remanded the matter to relook into the non-imposition of the penalty and upheld the decision of the Commissioner (Appeals). The appeal was dismissed.
The Customs, Excise &Service Tax Appellate Tribunal (CESTAT) of Delhi has held that the non-utilised Cenvat credit of EC & SHEC for payment of output tax/duty after 01.03.2015 is allowable to refund. A Coram of single member Shri Anil Choudhary, member (judicial) observed that the appellant not utilized the Cenvat credit of EC & SHEC for payment of output tax/duty in December 2016, the same would have become refundable as of 30/06/2017. If the appellant is required to deposit the said amount of Rs. 3,27,325/- in cash, it will become entitled to a refund of the duty earlier paid by utilization of credit of EC & SHEC.
In a batch of appeals, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) of Delhi has held that Input service credit distributed by Parle Biscuits as an Input Service Distributor working on CMU is allowable under rule 7(d) of the CENVAT Rules. While allowing the appeal, the Tribunal held that the appellant company can distribute CENVAT credit in respect of the service tax paid on inputs services to its manufacturing units, including a job worker and set aside the impugned orders.
In the case of M/s. Max Life Insurance Company India Ltd., the Delhi Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that Service tax was leviable under “Investment or Management Service under ULIP” on Policy Administration Charges, Front End Load and Switching Charges. Mr Anil Choudhary, member (judicial) Mr P V Subba Rao, member (technical) observed that the clarification by the Board vides TRU Circular No. DOF/334/1/2010 dated 26.02.2010, that such policy administration charges are chargeable to tax under Section 65(105)(zx). The revenue cannot be permitted to be taken a u-turnin the light ofthe Board’s Circular and are binding on the officers of the Revenue Department. The appeal is allowed and set aside the impugned order.
The Chennai bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) set aside the Consification of goods and penalty imposed under Customs Act as it was solely based on a statement adduced. The Tribunal observed that there is nothing on record other than Shri Chandrasekhar informing Shri R. Suresh that the above job was given to him by the appellant and in his voluntary statement, said Chandrasekhar has denied having known this appellant. The bench held that the penalty levied on the appellant is arbitrary and set aside the impugned order.
The pre-shipment inspection certificate is mandatory at the time of clearance of the goods by an importer, any other person including Steamer Agent has no locus of responsibility, the Chennai bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) set aside the penalty under section 112(a) of the Customs Act, 1962. A Single member bench of Mr P Dinesha, member (judicial) has held that “the said Memorandum cannot be made applicable just because the Revenue woke up after more than 8 years to issue the Show Cause Notice.”
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