This weekly round-up analytically summarizes the key stories of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) reported at taxscan.in, from January 7, 2024 to January 12, 2024.
The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) quashed the imposition of redemption fine and held that the bonafide of Usha International cannot be suspected just because the vendor chose to affix a different price tag.
A Two-Member Bench comprising M Ajit Kumar, Technical Member and P Dinesha, Judicial Member observed that “Clearly there was an understanding as regards the value is concerned, in support of which documents in the form of e-mails have been placed on record, which are not disputed by the Revenue. The value affixed on the label did not clearly show the price agreed upon in the purchase order dated 27.05.2013. Further, the said price tag was sought to be revised for the reason of fluctuation in the value of the Indian Rupee as against the U.S. Dollar, which fact was also not disputed, but however, the same apparently was not implemented by the foreign vendor / supplier.”
The Bangalore Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) quashed excise duty demand as there was no recovery of credit from the first stage dealer.
A Two-Member comprising DM Misra, Judicial Member and R Bhagya Devi, Technical Member observed that “We find that the purchasers, who have received the invoices, categorically denied availment/utilization of Cenvat Credit during the relevant period even though it was passed on to them in dealer’s invoice. Necessary evidences have been annexed to the Appeal paper-book. No contrary evidence has been placed by the Revenue to rebut the same. Thus, recovery of credit from the first stage dealer/importer-appellant as confirmed in the impugned order, cannot be sustained. In the result, the impugned order is set aside and the appeal is allowed with consequential relief, if any, as per law.”
The Hyderabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) ruled that no excise duty is leviable on clearances made to two projects through main contractor Bharat Heavy Electricals Limited (BHEL).
A Two-Member Bench comprising Anil Choudhary, Judicial Member and AK Jyotishi, Technical Member observed that “Thus, there are sufficient documents on record to prove that the Appellants were not required to pay any duty and were clearly entitled for benefit of Notification No. 6/2006. The reliance placed by the Appellants on certain case laws cited supra also support this view that when there is substantive compliance, even in case where such certification is by a person other than designated authority, benefits cannot be denied.”
The Customs Excise and Service Tax Appellate Tribunal (CESTAT) has provided relief to South Eastern Coalfields Ltd, affirming that the company is not required to impose Clean Energy Cess (CEC) on coal stock existing before July 1st, 2017. The tribunal clarified that the appellant company is exempt from paying CEC for goods removed on or after July 1, 2017, even if they were in stock as of June 30, 2017, following the repeal of the 2010 Finance Act.
The bench of Justice Dilip Gupta (President) and P.V. Subba Rao (Member), observed that in the present case, as the goods were removed on or after 01.07.2017, liability had not accrued or incurred on 30.06.2017 and even section 19 talks of collection and payment of arrears of duty.
In a major relief to M/s MHPL India Pvt Ltd, the Allahabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) ruled that Rule 6 (3) B of the Cenvat Credit Rules, 2004 (CCR) not applicable for demanding service tax for exempted services provided.
A Two-Member Bench comprising PK Choudhary, Judicial Member and Sanjiv Srivastava, Technical Member observed that “In the present case appellant have reversed the entire Cenvat credit prior to the issuance of the show cause notice. Thus, situation is that the appellant have not at all taken any Cenvat credit and hence there cannot be any applicability of the provisions of Rule 6 (3) B of Cenvat Credit Rules for demanding the service tax in respect of the exempted services provided.”
The Mumbai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) ruled that witnesses relied upon by the central excise authorities were not acceptable evidence in absence of cross-examination.
A Two-Member Bench comprising CJ Mathew, Technical Member and Ajay Sharma, Judicial Member observed that “The witnesses relied upon by the central excise authorities are not acceptable evidence in the absence of cross-examination that was denied. The impugned order fails on that ground but, as the request for cross-examination had been rejected deliberately, availability or amenability to production for cross-examination is not in question. To enable such cross-examination, we set aside the impugned order and remand the matter back to the original authority for fresh determination on the facts and evidences limiting reliance to such statements that have crossed the hurdle of ‘relevancy’ prescribed in section 9D of Central Excise Act, 1944.”
The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held that Regulation 10(n) of Customs Broker Licensing Regulations, 2018(CBLR) doesn’t mandate customs brokers to physically ascertain the correctness of address given in import detail. The bench observed that the Department itself fails to take note of the alleged non-existent address, it cannot shoot off the blame onto the Customs Broker.
A two-member bench comprising of Mr Ashok Jindal, Member (Judicial) and Mr Rajeev Tandon, Member (Technical) observed that the appellants filed the Bill of Entry in duly bonafide discharge of their functions as a Customs Broker and there is nothing on record to implicate them in any other business interest or relationship between the appellant and the importer other than as of Customs Broker.
The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal(CESTAT) has reduced the redemption fine considering the loss occurred for the assessee as the order of re-export of undervalued KIWI Fruit was delayed.
A Single Member bench of Ms Sulekha Beevi C S, Member (Judicial) held that a redemption fine of Rs. 5 lakhs imposed under Section 125 for redeeming the goods for re-export only requires to be set aside.
The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal(CESTAT) set aside the demand of Service Tax solely based on form 26 AS provided by the income tax department.
A single member bench of Mr K Anpazhakan Member (Technical) observed that the Department has not adduced any positive evidence to show malafide intention or mens rea for evasion of Service Tax on the part of the Appellant. The CESTAT held that an extended period cannot be invoked in this case to demand service tax on the Appellant.
The Chandigarh Bench of the Customs, Excise and Service Tax Appellate Tribunal(CESTAT) held that Form H can be valid evidence as it is a statutory document evincing the export of corrugated boxes. The bench viewed that the evidentiary value of such statutory documents, even though not related to central excise law, appears to have been misconstrued by the first appellate authority.
A two-member bench comprising Mr C J Mathew, Member (Technical) and Mr Ajay Sharma, Member (Judicial) observed that the appellant had submitted ‘form H’ which was held to suffice for the finding of the Tribunal in re Vadapalani Press. The rejection of the applicability of that decision was grounded in the absence of registration by the appellant and the consequent absence of records.
The Allahabad Bench of the Customs, Excise and Service Tax Appellate Tribunal(CESTAT) remanded the matter to consider as there was no bar of limitation arising under section 128 of the Customs Act, 1962. The bench observed that the revenue department failed to dispatch the order to the assessee to the correct address.
A single member bench of Mr P K Choudhary, Member (Judicial) observed that the initial burden to demonstrate that the order was sent by speed post with acknowledgement due is on the revenue. It is only when this initial burden is discharged by the revenue, only then the onus shifts to the addressee to prove to the contrary.
A two member bench of CESTAT approved appellant’s interest claim on the amount of refund sanctioned at the rate of 12% per annum from the date of the deposit of the amount till the date of refund thereof.
The two member bench comparison of Dr. Rachna Gupta (Member, Technical) and Dr. Hemambika R Priya (Member, Technical) held that “Section 35FF itself prescribes the rate of interest in the range of 5% to 36% when these provisions is read in the light of the above provisions and the decisions with respect to the rate of interest. We hold that the appellant is entitled to receive interest at the rate of 12%.”
The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) quashed service tax demand and observed that procuring orders for supply of garments for exports to foreign clients is intermediary services.
A Two-Member Bench comprising Vasa Seshagiri Rao, Technical Member and CS Sulekha Beevi, Judicial Member observed that “the appellant is the service provider and the overseas buyer is the service recipient and there is no oral or written agreement between the appellant and the vendors/exporters of garments. Also, the appellant had not received any consideration for the services provided in relation to export of goods from the vendors in India.”
The Hyderabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) upheld the excise duty demand as there was sufficient evidence to establish that the brand name belonged to a third person.
A Two-Member Bench comprising Anil Choudhary, Judicial Member and AK Jyotishi, Judicial Member observed that “Thus, in the absence of the Appellant’s providing any evidence that they were the brand name owners, irrespective of the fact that whether it was registered in their name or not and the market’s perception that brand name belonged to somebody else, it is not possible to consider that it did not belong to others. In fact, in this case, sufficient evidence is on record by way of statements and other relied upon documents to the effect that these brand names/trade names were belonging to SRCPL and Farmax.”
The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) ruled that the flue gas generated in the manufacture of coke is not a manufactured product and hence excise duty is payable.
A Two-Member Bench of the Tribunal comprising R. Muralidhar, Member (Judicial) and K. Anpazhakan, Member (Technical) observed that “In view of the above judicial pronouncements, we hold that the flue gas which is generated in the manufacture of coke is not manufactured product, therefore, duty is not payable.” To Read the full text of the Order CLICK HERE
In a major relief to Suzuki Motors, the Chandigarh Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) ruled that the excess amount collected from customers was not additional consideration to form part of assessable value.
A Two-Member Bench comprising SS Garg, Judicial Member and P Anjani Kumar, Technical Member observed that “We find that in the present case, it is undisputed fact that the place of removal of excisable goods is a factory gate of the appellant. We also find that in the case of ex-factory sale, the freight amount collected is not includible in the assessable value of the excisable goods in view of the various decisions relied upon by the appellant.”
The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) quashed excise duty demand and observed that the Activity of galvanizing is manufactured under the Central Excise and Tariff Act, 1985.
A Two-Member Bench comprising observed that “We find that the activity of galvanizing of the items falling under chapter 72 amounts to manufacture was introduced w.e.f. 08.04.2011 through Chapter (V) of the Finance Act, 2011. 11. As during the impugned period, galvanization of the items falling under chapter 72 of the CETA did not amount to manufacture, in that circumstances, the appellant is not liable to pay duty on galvanizing activity of the goods falling under chapter 72 of the Tariff Act during the impugned period.”
The Mumbai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) ruled that LED lights, fixtures and control panels are not inputs for the purpose of taxable output service.
A Two-Member Bench comprising S.K. Mohanty, Member (Judicial) and M.M. Parthiban, Member (Technical) observed that “We do not find any merits in the impugned order, insofar as the adjudged demands were confirmed on the appellants, holding that the disputed goods shall not be considered as inputs for the purpose of the provision of the taxable output service. Accordingly, by setting aside the impugned orders, the appeals are allowed in favour of the appellants, with consequential benefits, if any, as per law.”
The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) observed that demand of differential service tax under commercial or industrial Construction service denying abatement is invalid.
A Two-Member Bench of the Tribunal comprising Vasa Seshagiri Rao, Technical Member and Sulekha Beevi CS, Judicial Member observed that “After appreciating the facts and evidence placed before us and following the decisions cited, we are of the considered opinion, that the demands raised under construction of Residential Complex Services and Commercial or Industrial Construction Services for the disputed period cannot be sustained and requires to be set aside. The impugned order is set aside. The appeal is allowed with consequential reliefs if any.”
The Mumbai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) allowed to avail un-utilized Cenvat credit on export of input services.
A Two-Member Bench comprising (S.K. Mohanty, Member (Judicial) and M.M. Parthiban, Member (Technical) observed that “Insofar as claim of refund under Rule 5 of CCR is concerned, the department has to only verify whether the requirement of the said rule read with the notification issued thereunder have been fulfilled or not.”
The Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) ruled that the goods even if there is remote possibility of being found prohibited or restricted at time of adjudication, cannot be subjected to non release under Section 110A of Customs Act, 1962.
The two-member Bench comprising Somesh Arora, Judicial Member and Hemambika R Priya, Technical Member observed that “Therefore, We are of the view that goods even if there is any remote possibility of being found prohibited or restricted at the time of adjudication is there, cannot be subjected to non release in terms of Section 110A. In view of foregoing, we allow the provisional release of 26 Gold Dore weighing 5 kg plus more.”
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