This weekly round-up analytically summarizes the key stories of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) reported at taxscan.in, from February 24, 2024 to March 1, 2024.
A two member bench of CESTAT Ahmedabad ( Customs Excise & Service Tax Appellate Tribunal ) has held that non-inclusion of costs of transportation in assessable value is no ground to deny CENVAT credit
The bench comprising Ramesh Nair ( Member, Judicial ) and Raju ( Member, Technical ) held that it cannot be said that the assessee had a mala fide intention to evade the excise duty by taking the wrong credit. The bench observed that there was no suppression of fact or misstatement on the part of the assessee and further held that non-inclusion of costs of transportation in assessable value is no ground to deny CENVAT credit.
The Ahmedabad bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) has allowed the exemption of service tax for manpower supply to hospitals, emphasizing the importance of not suppressing facts to evade tax payments.
The coram of Ramesh Nair ( Judicial member ) and Raju ( Technical member ) observed that whether the respondent was entitled for the benefit of the exemption notification or not depends on the interpretation of the exemption notification and on the contrary, to a very large extent, their interpretation is found correct. Thus, it is evident that there was not even an iota of evidence to even suggest that there was any willful misstatement or suppression of facts on the part of the Respondent. Consequently, extended period was not invokable in this case
A two member bench of Customs Excise & Service Tax Appellate Tribunal ( CESTAT ) has held that royalty is not payable in instances of trading of imported finished goods and on goods repacked in India and it is only for use of technology to produce the products in India. The bench observed that royalty is payable only for use of technology to produce the products in India. The tribunal observed that royalty cannot be added to the finished goods imported by the appellant for trading purposes.
The Ahmedabad Bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) set aside the calculation of assessable value as the calculation of Basic Customs Duty on MRP of the goods was contrary to Proviso of Section 3 (1) of the Central Excise Tariff Act, 1985 ( CETA ).
A Two-Member Bench comprising Ramesh Nair, Judicial Member and Raju, Technical Member observed that “It would be evident from the calculation appearing on the Appeal that the Principal Commissioner has wrongly calculated the Basic customs duty on the MRP of the goods, which is contrary to the provisions of Proviso to Section 3 (1) of the Central Excise Tariff Act. As per Proviso to said Section 3 (1), Excise duty on goods manufactured by a 100% EOU and brought to any place in India shall be an amount equal to aggregate of customs duties leviable on like goods when imported into India and the value of such goods shall be as per the Customs Act 1962 and the Customs Tariff Act 1975.”
The Mumbai Bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) ruled that sufficient compliance of Cenvat Credit Rules, 2004 ( CCR ) is complete on reversal of cenvat credit on common input services.
A Two-Member Bench comprising S.K. Mohanty, Member ( Judicial ) and M.M. Parthiban, Member ( Technical ) observed that “In view of the above facts of the case and the judgement delivered by the Supreme Court, it cannot be said that the appellants had incorrectly availed and utilised CENVAT credit, inasmuch as the appellants had not taken Cenvat credit in respect of exempt projects/services and had also reversed the Cenvat credit in respect of common input services, duly informing the department with complete details. Further, in view of the above judgement of the Hon’ble Apex Court, it could be concluded that the reversal of Cenvat credit in respect of common input services by the appellants is sufficient for compliance with the Cenvat Credit Rules, 2004.”
The Chennai bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) has held that Cenvat Credit allowable service tax for financial services provided by the bank.
A division bench comprising Mrs Sulekha Beevi C S, Member ( Judicial ) and Mr Vasa Seshagiri Rao, Member ( Technical ) found that the disallowance of credit is without any basis. While allowing the appeal, the CESTAT set aside the impugned order.
The New Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) observed that the responsibility cast on customs broker ( CB ) under Regulation 10(n) of the Customs Brokers Licensing Regulations, 2018 ( CBLR ) stands fulfilled when verification of address is complete.
A Two-Member Bench of Binu Tamta, Judicial Member and Hemambika R Priya, Technical Member observed that “We find that both the GSTIN as well as the IEC indicates the address of the client. This in itself is independent data to verify the correctness of the identity/address of the client. We also note that there is nothing on record to show that either of these documents were fake or forged. Therefore, once verification of the address is complete as discussed above, the responsibility cast on the appellant under Regulation 10(n) stands fulfilled.”
The Chandigarh Bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) quashed the excise duty demand against Pepsico on scrap-veg-refuse from manufacture of exempted goods.
A Two-Member Bench comprising SS Garg, Judicial Member and P Anjani Kumar, Technical Member observed that “The Appellant No.1 effectively does not take any process to extract the potato starch from the potatoes except for extraction of water for reuse. The Appellant No.1 has also placed the literature explaining the process of potato starch extraction explained by the International Institute of Starch, Denmark and also filed an affidavit of their Associate Director of Research & Development Division clarifying the difference between ‘potato starch’ and ‘scrap-veg-refuse’.”
The Delhi bench of the Customs Excise & Service Tax Appellate Tribunal ( CESTAT ) set aside the order of revoking the customs broker license against the allegation of fraudulent Integrated Goods and Service Tax ( IGST ) Refund. It was observed that the responsibility of the customs broker was fulfilled once the verification of the address was done.
A two-member bench comprising Ms Binu Tamta, Member ( Judicial ) and Ms Hemambika R Priya, Member(Technical) observed that under Regulation 10(n) the Customs Broker is required to verify the functioning of the client at the declared address using reliable, independent, authentic documents, data or information. This responsibility, again, can be fulfilled using documents data or information so long as they are reliable, independent and authentic. Nothing in this clause requires the Customs Broker to physically go to the premises of the client to ensure that they are functioning at the premises
The Delhi bench of the Customs Excise & Service Tax Appellate Tribunal ( CESTAT ) has held that mere non-traceability of an exporter by itself does not amount to a violation of regulation 10 (n) of Custom Brokers under Regulation ( CBLR ), 2018.- WORLD LINE CARGO MOVERS vs COMMISSIONER OF CUSTOMS (Airport & General) CITATION: 2024 TAXSCAN (CESTAT) 29
A division bench comprising of Ms Binu Tamta, Member ( Judicial ) and Ms Hemambika R Priya, Member ( Technical ) viewed that Regulation 10(n) of CBLR cannot be read to mean the latter as it would imply treating the Customs Broker as one who is competent and responsible to oversee and ensure the correctness of the actions by the Government officers. It would also mean that actions by the Customs Broker under the CBLR prevail over the actions by officers under the Foreign Trade ( Development and Regulation ) Act, 1992 ( under which the IEC is issued by DGFT ) and the Central Goods and Services Tax Act ( or state GST Act ) ( under which the GSTIN is issued by the GST officers ).
In a recent case, the Chennai bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) set aside the redemption fine imposed on jute bags. Further, observed that the redemption fine imposed cannot exceed the market value of the product.
The Tribunal reduced the redemption fine to Rs.3,00,000/- (Rupees Three Lakhs only). Insofar as penalty is concerned, the action of the appellant in shooting the letter dated 26.02.2014 before the adjudicating authority itself is an indication, which prompted the adjudicating authority to pass the Order-in-Original assuming that the import, primarily, was improper. Since the Revenue has accepted the reduced penalty amount by the first appellate authority’s order, the same is sustained. To Read the full text of the Order
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