CESTAT Weekly Round-Up

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

Service provided by the Project developer doesn't fall under Real Estate Agent, No Service Tax

In J P Infrastructure Pvt Ltd vs Commissioner of Central Excise & ST, 2022 TAXSCAN (CESTAT) 703, the Ahmedabad Bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that the Service provided by the Project developer doesn’t fall under Real Estate Agent and Service Tax is not demandable.

Confiscation of Goods and Penalty not permissible When Imported Goods are not mis declared: Ruling in favour of Surya Exim Ltd

In an appellant favorable ruling in SURYA EXIM LIMITED vs C.C., AHMEDABAD, 2022 TAXSCAN (CESTAT) 704, the Ahmedabad Bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that the Confiscation of goods and penalty not permissible when imported goods are not mis-declared.

Eligibility of Capita India for Interest on delayed Sanction of Refund Claim under Rule 5 of CCR upheld

In Capita India Pvt. Ltd. vs Commissioner of Central Tax, 2022 TAXSCAN (CESTAT) 705, CESTAT, upheld the eligibility of Capita India Pvt Ltd, the appellant for interest on delayed sanction of refund claim under Rule 5 of Cenvat Credit Rules, 2004.

Payment of 25% of Penalty is adequate to Compensate Revenue Department: Penalty under Rule 15(2) of CENVAT Credit Rules set aside

In M/s. Surin Automotive Ltd vs Commissioner of GST & Central Excise - 2022 TAXSCAN (CESTAT) 706, the Chennai Bench of CESTAT while setting aside the penalty under Rule 15(2) of CENVAT Credit Rules has held that payment of 25% of the Penalty is adequate to compensate the revenue department if the duty along with interest is paid within 30 days from the communication or order.

Plea of Change of Classification as Tariff rate for Customs Duty will become Nil

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), New Delhi Bench in M/s. Globus Infocom Ltd vs Principal Commissioner of Customs - 2022 TAXSCAN (CESTAT) 707 ordered re adjudication as when plea of change of classification made is successful, Tariff rate for Customs Duty will become Nil.

Demand for excess CENVAT Credit can't be based on Third Party's Statement

The Kolkata Bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that demand for excess CENVAT credit can’t be based on a third party’s statement in AIC Iron Industries Private Limited Vs Commissioner of CGST & CX, Bolpur Commissionerate, 2022 TAXSCAN (CESTAT) 709. The Coram of Shri P K Choudhary, Member(Judicial) observed that there is no other evidence on record of cash flow-back or any inculpatory statement to substantiate that CENVAT Credit was taken irregularly based on paper transaction i.e. without receipt of raw materials against invoices.

Interest of 6% p.a allowable on amount Deposit u/s 35F of Excise Act when not Refunded within 3 months

The Delhi Bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that the interest of 6% per annum is allowable on an amount deposited under Section 35F of the Excise Act when not refunded within 3 months, in HEG Ltd. vs Commissioner, CGST Division-III -2022 TAXSCAN (CESTAT) 710.

Interest on delayed Refund payable u/s 11BB of Central Excise Act when the Double benefit of the Same amount does not exist

In Bright Engineering Works Erstwhile 100 Eou vs C.C.E. & S.T - 2022 TAXSCAN (CESTAT) 711, the Ahmedabad Bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that interest on delayed refund payable u/s 11BB of Central Excise Act when the double benefit of the same amount does not exist. It was viewed that the Appellant has fulfilled conditions laid down under Rule5 of Cenvat Credit Rules, 2004 read with Notification No. 5/2006-C.E. (N.T.) dated 14-3-2006.

Imposing Late Fee Charges merely because of filing of Second Bill of Entry is not valid

In M/s MIRC Electronics Ltd vs Commissioner of Customs - 2022 TAXSCAN (CESTAT) 716, the Mumbai Bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that imposing late fee charges merely because of filing of the second bill of entry is not valid. It was held that “imposition of the late fee itself and its confirmation by the Commissioner (Appeals) by erroneously holding that there was no dispute of the fact that Bill of Entry was filed beyond the time limit prescribed under Section 46(3) of the Customs Act, 1962, was irregular and unsupported by any legal provision.”

Fraudulent Import of Vehicles as Brand-New Vehicles, Excessive Penalty reduced

A Single Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), reduced excessive penalty imposed on fraudulent import of vehicles as brand-new vehicles in Shri Charanjit Singh vs Commissioner of Customs - 2022 TAXSCAN (CESTAT) 717.

Order as to Non-Filing of Country of Origin Certificate on Non-Verification of Bill of Entry set aside

The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), in M/s. The Timberland vs The Commissioner of GST & CE - 2022 TAXSCAN (CESTAT) 718, set aside the order as to non-filing of Country of Origin Certificate, on non-verification of Bill of Entry. The Tribunal of P Dinesha, Judicial Member held that “Without going into or looking into the Bill of Entry, the first appellate authority has given a wrong finding as to the non-filing of the Country of Origin Certificate. In view of the above, I am of the view that the impugned order has to be set aside.”

Amount not Hit by Unjust Enrichment, Service Tax Refund allowed

The Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ), Chennai Bench allowed service tax refund as it was established that the amount was not hit by unjust enrichment, in Sodecia India Ltd. vs The Commissioner of GST & Central Excise - 2022 TAXSCAN (CESTAT) 719.

Relief to Chettinad Cement: CESTAT sets aside denial of Cenvat Credit

The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), set aside denial of Cenvat Credit, in M/s. Chettinad Cement Corporation Private Limited vs The Commissioner of G.S.T. and Central Excise - 2022 TAXSCAN (CESTAT) 721. The Tribunal also noted that the Order-in-Original cannot stand as the same is passed not only without adhering to the directions of this Bench, but also omitting to properly take note of the contents/job description in the work orders reproduced by him.

Relief to Vedanta Limited, Cenvat Credit on Supplementary Invoices allowed

In Vedanta Limited vs C.C.E. & S.T.-Daman - 2022 TAXSCAN (CESTAT) 722, the Delhi Bench of Income Tax Appellate Tribunal (ITAT) presided over by Dr. B. R. R. Kumar (Accountant Member) and Yogesh Kumar US (Judicial Member) dismissed the appeals filed by the Revenue on the grounds that no records was found on receipt of unaccounted cash or incriminating material during search conducted by Assessing Officer (AO) under Section 132(1) of the Income Tax Act, 1961.

Relief to Universal Bituminous Industries, No Penalty u/s 11A (4) in the Absence of Tax Evasion

In a major relief to the assessee, in Universal Bituminous Industries Pvt. Ltd. Vs Commr. of CGST & CX, Howrah Commissionerate, 2022 TAXSCAN (CESTAT) 723, the Kolkata Bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that imposition of penalty under Section 11A (4) of the Central Excise Act,1944 is not permissible in the absence of tax evasion.

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