Annual Customs, Excise and Service Tax Case Digest: CESTAT Rulings 2025 (Part 16)

This article summarises all CESTAT orders published in the Taxscan.in.

No Chinese Link Found in Alloy Wheel Imports from Taiwan: CESTAT quashes ₹4.62 Crore ADD Demand

SANJAY KACHERIA vs COMMISSIONER OF CUSTOMS 2025 TAXSCAN (CESTAT) 851

Sanjay Kacheria, the Managing Director of Neo Wheels Ltd. The company is a manufacturer of alloy wheels engaged in both domestic sales and exports. Between December 2014 and February 2017, the company imported semi-finished aluminum alloy wheels from Taiwan. These goods were assessed and cleared by customs based on certificates of origin indicating Taiwan as the source.

The two-member bench comprising Anil G. Shakkarwar (Technical Member) and Dr. Suvendu Kumar Pati (Judicial Member) observed that there was no conclusive evidence showing that the goods were manufactured or shipped from China. The tribunal further observed that none of the 30 bills of entry involved imports from Futek Alloy Co. Ltd. or Fortune Rainbow, the companies referenced in the consulate letter.

Sulphur Limit in IS 17049 Applies to Calcined, Not Raw Petroleum Coke: CESTAT upholds DGFT Clarification

Commissioner of Customs(Port) vs M/s. India Carbon Ltd 2025 TAXSCAN (CESTAT) 852

India Carbon Ltd., the respondent, imported raw petroleum coke under a valid import license issued by the Directorate General of Foreign Trade (DGFT) based on recommendations of an expert committee.

The two-member bench comprising Ashok Jindal (Judicial Member) and K. Anpazhakan (Technical Member) observed that the DGFT's clarification clearly supported the view that the sulphur limit under IS 17049 applies to the output product, CPC, and not to the input material, RPC.

The tribunal also observed that the customs department could not overrule or reinterpret the licensing conditions clarified by the DGFT. The tribunal explained that the import was in line with the policy and quota issued by the competent authority and that applying CPC standards to RPC was a misreading of the policy.

Setback for Godrej: CESTAT rules Buyer-Facilitated Duty-Free Benefits via LoIs Constitute Additional Consideration

Commissioner of Central Excise vs Godrej Industries Limited 2025 TAXSCAN (CESTAT) 853

Godrej Industries Ltd., the appellant, is engaged in the manufacture of products like Erucic acid, Stearic acid, and Oleic acid. The company sold these products to buyers who held Advance Licenses and provided LoIs, allowing Godrej to import raw materials without paying customs duty. Godrej also claimed duty drawback on these deemed exports.

The two-member bench comprising S.K. Mohanty (Judicial Member) and M.M. Parthiban (Technical Member) observed that the LoIs and AROs clearly enabled Godrej to gain a cost advantage, which was reflected in lower prices offered to specific buyers. It held that this benefit constituted additional consideration flowing from buyer to seller.

99-Year Land Lease with One-Time Premium Is a Sale of Immovable Property, Not a Taxable Service: CESTAT

M/s. Raipur Development Authority vs Commissioner of Customs,Central Excise and Service Tax 2025 TAXSCAN (CESTAT) 854

Raipur Development Authority, the appellant, is a statutory body established under the Chhattisgarh Nagar Tatha Gram Nivesh Adhiniyam, 1973. It entered into a development agreement with a private party, granting long-term lease rights over government-owned land in exchange for a one-time lease premium and annual ground rent.

The two-member bench comprising Justice Dilip Gupta (President) and P.V. Subba Rao (Technical Member) observed that the development agreement effectively transferred the rights in immovable property and was not a service under Section 65B(44) of the Finance Act.

The tribunal ruled that the lease of land for a long duration in exchange for a one-time payment did not attract service tax. The appeal was partly allowed and the demand relating to service tax on lease premium, ground rent, interest, and CENVAT credit reversal was set aside.

Cenvat Credit on Sales Commission to Agents Admissible: CESTAT

M/s. Tamilnadu Petroproducts Ltd vs Commissioner of GST &Central Excise 2025 TAXSCAN (CESTAT) 855

Tamilnadu Petroproducts Ltd, the appellant, is a manufacturer of chemicals, including Linear Alkyl Benzene and Epichlorohydrin. During an audit, the department found that the appellant had availed Cenvat credit on service tax paid on sales commission paid to domestic marketing agents from April 2011 to December 2014.

The tribunal explained that the Gujarat High Court’s Cadila Healthcare decision was based on facts where the commission agents did not engage in sales promotion, unlike in the present case, where evidence of sales promotion by agents was available. It also held that since the appellant disclosed the credit availed in statutory returns and there was no evidence of suppression or intent to evade duty, the extended period invocation and penalty under Section 11AC were not sustainable.

CESTAT Quashes Customs Duty Demand on Re-Imported Rejected Diesel Generator Sets Citing Lack of Suppression

Sterling Generators Pvt Limited vs Commissioner CGST &Central Excise 2025 TAXSCAN (CESTAT) 856

Sterling Generators Pvt Ltd, the appellant, is a 100% Export Oriented Unit (EOU) manufacturing diesel generator (DG) sets. They supplied five DG sets to SEZ Biotech Services Pvt Ltd, an SEZ unit, in March 2008, out of which three DG sets were rejected by the SEZ buyer.

The tribunal explained that since the extended period could not be invoked, the customs duty demand and penalties under Sections 112 and 114A of the Customs Act were unsustainable. The tribunal also observed that procedural delays should not result in the denial of substantive benefits where goods are returned and re-engineered for customer-specific requirements within the EOU operational framework.

The tribunal set aside the demand of customs duty, interest, and penalties on Sterling Generators Pvt Ltd and its authorised signatory, Nagendra Singh, and allowed the appeals with consequential relief.

CESTAT Allows Concessional Duty Benefit on Aluminium Based Laminates Used in MCPCBs

M/s. Arktron Electronics vs Commissioner of Customs (Preventive) 2025 TAXSCAN (CESTAT) 857

Arktron Electronics,appellant-assessee,had been engaged in the manufacture of Printed Circuit Boards. During the relevant period, it sought exemption under Serial No. 39 of Notification No. 24/2005-Cus in respect of aluminium-based copper clad laminates imported for use in the production of metal clad printed circuit boards.

In another case,Principal Commissioner of Customs vs. B.S. Electronics Private Limited,the Tribunal reiterated that metal clad printed circuit boards (MCPCBs) qualified as printed circuit boards and that the exemption covered laminates with a metal core, including aluminium-based ones.

The two member bench comprising Justice DilipGupta (President) and P.V.Subba Rao (Technical Member) based on these rulings, found the order passed by the Commissioner of Customs (Preventive) unsustainable. It set aside the order and allowed the appeal.

Relief for BHEL: CESTAT rules Reimbursed Freight Charges Not Taxable as Service, quashes ₹16 Cr Demand

M/s. Bharat Heavy Electricals Ltd vs Commissioner of GST andCentral Excise 2025 TAXSCAN (CESTAT) 858

BHEL, a government-owned engineering company, entered into contracts with Nabinagar Power Generating Co. Ltd. for supplying and installing equipment. Under the contract terms, BHEL was responsible for transporting the goods to the site. For this, it hired Goods Transport Agencies (GTAs) and paid service tax under the reverse charge mechanism.

The two-member bench comprising Ajayan T.V. (Judicial Member) and Vasa Seshagiri Rao (Technical Member) observed that BHEL was not a GTA and had not issued any consignment notes. The tribunal further observed that transportation of goods by road, other than by a GTA or courier agency, was exempt under Section 66D(p) of the Finance Act, 1994.

The tribunal also found that the freight amounts collected from the customer were reimbursements and not consideration for a separate service.

Pre-Deposit Waiver Denied for CESTAT Appeal u/s 35F of Excise Act: Delhi HC Grants Extension Till 31 Oct 2025 for Remaining Payment

NK SHARMA vs ASSISTANT COMMISSIONER 2025 TAXSCAN (CESTAT) 859

The petition was filed by N.K. Sharma (petitioner) under Articles 226 and 227 of the Constitution of India, seeking waiver of Rs. 1,12,000/-, which constitutes 2.5% of the penalty amount, for filing the appeal before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT).

A bench comprising Justice Prathiba M. Singh and Justice Rajneesh Kumar Gupta observed that the prayer for partial waiver was not tenable in light of the settled legal position.

The court, in view of the facts and circumstances, granted the petitioner time till 31st October 2025 to make the remaining pre-deposit. The petition was disposed of accordingly, along with any pending applications.

Relief for BPL Ltd: CESTAT Rules Payment Received from JVA as Pure Reimbursement for Business Transfer Delay, Not Manpower Supply

M/s. BPL Limited vs The Commissioner of Service Tax 2025 TAXSCAN (CESTAT) 860

BPL Ltd entered into a business transfer agreement with Sanyo BPL Pvt Ltd (SBPL) on 14 December 2005 for transferring its colour television business, including employees, to the joint venture. The transfer, which was supposed to happen in June 2005, was delayed until 15 December 2005 due to reasons beyond BPL’s control. During this period, BPL paid salaries and rent and raised debit notes to SBPL to recover these costs.

The two-member bench comprising P.A. Augustian (Judicial Member) and R. Bhagya Devi (Technical Member) observed that the joint venture agreement included employee transfer as part of the business sale, and the payments made were reimbursements for the expenses incurred during the transition period.

Relief to Bosch: CESTAT Rules Notional Cost of Free Designs from Maruti Not Part of Excise Duty Valuation

M/s. Bosch Ltd. vs Commissioner of CGST & Central Excise,New Delhi 2025 TAXSCAN (CESTAT) 861

Bosch Ltd.,appellant-assessee, had challenged the inclusion of the notional cost of free drawings and designs provided by Maruti Suzuki in the excise duty valuation of parts and components supplied to Maruti.

The two member bench comprising Justice Dilip Gupta ( President ) and P.V.Subba Rao( Technical Member) examined the issue in detail in the case of Denso India Private Limited vs. Additional Director General (Adjudication) and held that the notional cost of drawings and designs supplied free of cost by Maruti could not be included in the assessable value of parts and components manufactured by vendors and cleared to Maruti for excise duty purposes.

CESTAT Sets Aside Enhanced Penalty on Visa Steel Ltd., Restores Original ₹20k Fine as Delay Not Attributable to Importer

M/s. Visa Steel Ltd vs Commissioner of Customs (Preventive) 2025 TAXSCAN (CESTAT) 862

The appellant Visa Resources India Ltd had imported 16 consignments under various Bills of Entry during the period 2011-2012 to 2014-2015. Later, customs authorities issued a Show Cause Notice to the company inquiring about the non-finalization of some provisionally assessed Bills of Entry as required under the Customs (Provisional Duty Assessment) Regulations, 2011.

The Bench comprising R. Muralidhar (Member Judicial) and Rajeev Tandon (Member Technical) set aside the enhanced penalty holding that on the factual matrix with respect to the 8 Bills of Entry, the assessment was finalized without any fault on the part of the appellant.

CESTAT sets aside Revocation of Customs Broker License as Proceedings Violated Mandatory Timelines under CBLR

Commissioner of Customs (Import) vs M/s. Raj Brothers ShippingPvt. Ltd. 2025 TAXSCAN (CESTAT) 863

The appellant Raj Brothers Shipping Pvt. Ltd., a licensed Customs Broker (CB) based in Chennai, was engaged in clearing a consignment of "Drawer Channel" imported from China by Poonamani Industries.

The tribunal emphasized that the procedural irregularities related to timelines had already expired and the violation could not be cured by remanding the matter to the Original Authority. Accordingly, the appeal was disposed of.

Reimbursed Expenses for Stationery Not Includible in Assessable Value: CESTAT Quashes ₹83.92 Lakh Service Tax Demand on Chandigarh NIELIT

M/s National Institute of Electronics and Information Technologyvs Commissioner of Central Excise and Service Tax 2025 TAXSCAN (CESTAT) 864

The appellant NIELIT, an autonomous body of the Central Government under the Ministry of Communications and IT is engaged in Data Processing Services to State Electricity Boards such as Punjab State Power Corporation, Dakshin Haryana Bijli Vitran Nigam, Uttar Haryana Bijli Vitran Nigam, and U.T. Chandigarh.

The bench comprising S. S. Garg (Judicial Member) and P. Anjani Kumar (Technical Member) found merit in the appellant’s submission and allowed the appeal by relying on the Supreme Court ruling in Intercontinental Consultants & Technocrats Pvt Ltd vs. Union of India (2013).

The Apex Court, in Intercontinental Consultants held that “in the valuation of taxable service, the value of taxable service shall be the gross amount charged by the service provider ‘for such service’ and the valuation cannot be anything more or less than the consideration paid as quid pro quo for rendering such a service.”

‘Half-Hearted Investigation by DRI’: CESTAT Remands Genuineness of Manufacturing Activity Matter for Reinvestigation

M/s.Welcord Component Industries vs The Commissioner of GST 2025 TAXSCAN (CESTAT) 865

Welcord Component Industries, the appellant, is engaged in the manufacture of wire-insulated assemblies used in mosquito repellent devices for Godrej Consumer Products Ltd. A search was conducted at their premises by the Central Excise department on December 8, 2014, during which the statements of several employees and partners were recorded.

The two-member bench comprising P. Dinesha (Judicial Member) and M. Ajit Kumar (Technical Member) observed that the department alleged the absence of manufacturing, but it did not fully deny the existence of machinery or manufacturing activity. Key evidence, including a DVD submitted by the appellant to demonstrate manufacturing operations and stock details from the mahazar, was not addressed in the adjudicating authority’s order. The tribunal also observed that no effort was made to consult an expert to assess the condition of the machinery or to verify records at Godrej’s end.

Jharkhand Agricultural Marketing Board Not a Service Provider but Merely Supervisory: CESTAT Quashes Service Tax Demand

M/s Jharkhand State Agricultural Marketing Board vs Commr. ofCentral Excise & Service Tax, Racnhi 2025 TAXSCAN (CESTAT) 866

JSAMB, the appellant, is a statutory board established by the Government of Jharkhand to oversee agricultural marketing across the state. The department issued show cause notices alleging that JSAMB had let out immovable property and collected rent between 2008–09 and 2011–12 without paying service tax under the “Renting of Immovable Property” category. A service tax demand of Rs. 64,85,298 was confirmed by the adjudicating authority, along with interest and penalties under Section 78 of the Finance Act, 1994.

The two-member bench comprising R. Muralidhar (Judicial Member) and Rajeev Tandon (Technical Member) observed that rental agreements clearly identified APMCs as the lessors and the rent was deposited directly into their accounts. The board did not own or lease the properties in question and did not receive any rental income.

The tribunal further observed that the Supreme Court decision relied upon by the department applied to the APMCs themselves and not to supervisory boards like JSAMB. Since JSAMB was not the service provider, it could not be held liable for service tax under the “Renting of Immovable Property” category.

CESTAT upholds Penalties for Non-Registration on Ghaziabad Development Authority, denies Limitation Bar Claim

Ghaziabad Development Authority vs Commissioner of CentralExcise & Service Tax, Ghaziabad 2025 TAXSCAN (CESTAT) 867

The case stems from two show cause notices issued in 2013 and 2014, covering the period 2008-09 to 2012-13, demanding over ₹23.7 lakh in service tax on services classified under Renting of Immovable Property and Mandap Keeper. The GDA had not registered under service tax laws or filed service tax returns despite providing taxable services. Authorities imposed interest and penalties under Sections 77 and 78 of the Finance Act, 1994, citing suppression of facts.

While upholding the penalties under Section 77 for failure to register and file returns, the Tribunal set aside the heavier penalties under Section 78, which are linked to suppression and intent to evade.

The Tribunal directed the adjudicating authority to recompute the tax liability limited to the normal period within three months. This ruling highlights that while statutory bodies are not immune to service tax on commercial activities, procedural compliance failures will still attract penalties.

CESTAT clears Retrospective Penalties in CENVAT Credit Case

M/s YP Audiovisual Pvt. Ltd vs Commissioner of Central Excise& CGST

2025 TAXSCAN (CESTAT) 868

The appeal arose from an earlier order by the Commissioner, CGST Noida, who had imposed penalties totalling over ₹1 crore on M/s YP Audiovisual Pvt. Ltd., its directors, and several associated entities and individuals. The penalties were levied on grounds that the appellants had issued or abetted in issuing invoices that facilitated wrongful CENVAT credit to M/s Accurate Meters Ltd., the main noticee in the case.

The Tribunal also dismissed the revenue’s reliance on alleged admissions or settlements by the main noticee, noting that such aspects could not justify penal action against co-noticees without a legal basis. The appeals were thus allowed, and all penalties against the appellants were set aside.

Duty Liability Confirmed on Final Product Due to CENVAT Credit Availment: CESTAT sets aside Penalties

Asma Traders vs Commissioner, CGST & Central Excise 2025 TAXSCAN (CESTAT) 869

M/s Asma Traders, engaged in the manufacture of Narrow Woven Fabrics, was earlier found availing CENVAT credit on inputs, despite their final product being exempt from excise duty under Notification No. 30/2004-CE, provided no input credit is availed. The firm had initially paid duty on an intermediate product, Polypropylene Multifilament Yarn (PPMFY), under protest from May 2015 onwards. However, in earlier proceedings, the Tribunal ruled that PPMFY, as generated during the continuous manufacturing process, was not marketable and hence not dutiable.

In its detailed order by the CESTAT bench comprising Mr. P.K. Choudhary (Judicial Member) and Mr. Sanjiv Srivastava (Technical Member) confirmed that since the appellant had availed CENVAT credit on inputs used for manufacturing exempted goods, they were not entitled to the exemption under Notification No. 30/2004-CE. The Tribunal directed the department to rework the duty demand after giving credit for duty already paid on PPMFY.

Aircraft Maintenance Training not Taxable as Commercial Coaching: CESTAT Exempts The Bombay Flying Club’s Member Services under Mutuality Doctrine

The Bombay Flying Club vs Commissioner of Service Tax 2025 TAXSCAN (CESTAT) 870

The Bombay Flying Club provides Director General of Civil Aviation (DGCA) approved training in aircraft maintenance engineering and it also undertakes maintenance and repair of aircrafts owned by members of the club, which was registered as a non-profit organisation. The Revenue had viewed these services as taxable under “commercial coaching and training” and “management, maintenance and repair services” respectively, invoking Section 65(105)(zzc) and Section 65(64) of the Finance Act, 1994.

The Tribunal ruled that the course completion certificate was recognized by law and the training was not taxable, particularly due to Notification No. 33/2011-ST dated 25.04.2011.

The Tribunal noted that the Club charged only the cost of overhauling and rendered the services to its members. Applying the Supreme Court's ruling in State of West Bengal vs. Calcutta Club Ltd. (2019), the Tribunal held that the doctrine of mutuality applied and the services could not be taxed, as a club cannot render services to itself.

Bus Services for Transporting Employees and School Children Qualify for Service Tax Exemption Under Entry 23(b) of Notification: CESTAT

M/s. Century Pulp & Paper vs Commissioner of CGST 2025 TAXSCAN (CESTAT) 871

Century Pulp and Paper, the appellant, is engaged in the manufacture of writing and printing paper, paperboard, and rayon-grade pulp. During a service tax audit covering the period from July 2012 to November 2015, the department found that the company had entered into agreements with various travel agencies to provide buses for employee and school transport.

The two-member bench comprising Dr. Rachna Gupta (Judicial Member) and P.V. Subba Rao (Technical Member) observed that the buses were not hired for tourism or private charter but were used solely for point-to-point transport of passengers under fixed contracts.

The tribunal held that these services qualified for exemption under Entry 23(b) and that service tax could not be demanded. The tribunal accordingly set aside the confirmed demand and allowed the appeal.

Coaching Centre Had No Intent to Evade Tax: CESTAT Quashes ₹3.06 Cr Extended Period Service Tax Demand and Penalty

Soft Dot Hi-Tech Educational and Training Institute vsCommissioner of Service Tax 2025 TAXSCAN (CESTAT) 872

The appellant-assessee, Soft Dot Hi Tech Educational and Training, is claimed to have been running study centres under a distance education mode for various Universities for imparting education in various courses such as B.Com, BBA, and MBA and it is the universities that award the degrees or diplomas to students undertaking education at such centres.

The Bench comprising Justice Dilip Gupta (President) and P.V. Subba Rao (Technical Member) found that the conditions for invoking the extended limitation period were not met in this case.

The Tribunal only upheld the demand for the normal period of limitation and remanded the matter to the revenue to examine only what portion of the demand falls within the normal period of limitation under section 73(1) of the Finance Act. Then, consider whether the penalty under sections 77 and 78 of the Finance Act should be leviable on the appellant for this period and to determine the amount of the penalty.

Manufacturer Cannot Pay Duty on One Brand and Claim SSI Exemption on Another in Same FY: CESTAT

M/s. Switz Foods Pvt. Ltd. vs Commr. of Central Excise,Kolkata-V 2025 TAXSCAN (CESTAT) 873

Switz Foods Pvt. Ltd., the appellant, is engaged in manufacturing cakes and cookies under different brand names, including ‘Fresh Bake’ and ‘Bake Shop’. The company paid excise duty on goods under the ‘Fresh Bake’ brand and it claimed SSI exemption under Notification No. 8/2003-CE for products cleared under the ‘Bake Shop’ brand, all from the same factory premises.

The two-member bench, comprising R. Muralidhar (Judicial Member) and Rajeev Tandon (Technical Member) held that the SSI exemption must be applied uniformly across all eligible products from the same unit in a financial year, and a manufacturer cannot split excise duty and exemption between different brands produced in the same facility.

Despite affirming the legal principle, the tribunal allowed the appeal and set aside the duty demand, observing that Switz Foods’ total turnover for each financial year under dispute did not exceed the applicable SSI exemption threshold (Rs. 1 crore or Rs. 1.5 crore, depending on the year). The tribunal also considered that excise returns had been filed regularly and that no suppression of facts was found.

CESTAT Rules Mining Services Between Distinct Entities Taxable, Not “Self‑Service”, Rejects Refund Claim

M/s. Mayur Inorganics Limited vs Commissioner of CGST &Central Excise- Jodhpur 2025 TAXSCAN (CESTAT) 874

Mayur Inorganics Limited,appellant-assessee,was registered with the Service Tax Department from October 2017 for providing taxable services. It sought a refund of ₹21,13,639, claiming this amount was wrongly paid as service tax to RSMML through debit notes for limestone mining.

The two member bench comprising Dr.Rachna Gupta Judicial Member) and P.V.Subba Rao (Technical Member) heard both sides and examined the case records.It noted that the Commissioner (Appeals) had rejected the refund claim because RSMM charged service tax on limestone mining, and both RSMM and the assessee were separate legal entities. The tribunal held that the activity could not be treated as “self service.”

It also referred to the joint venture agreement and the Central Board of Exciseand Customs (CBEC) circular, stating that services provided between the joint venture and its members were taxable. Since the assessee paid RSMM for these services, the service tax was correctly charged.

Relief for Malayala Manorama: CESTAT Allows Classification of Imported Paper in Reels as "Newsprint" Due to Non-ISO Testing

M/s. Malayala Manorama Company Limited vs Commissioner ofCustoms 2025 TAXSCAN (CESTAT) 875

Malayala Manorama Company Limited,appellant-assessee,imported 243.83 MTS of paper reels in May 1999, declaring them as standard “newsprint” under Customs Tariff Heading 480180. The goods were cleared provisionally, and samples were sent for testing. The test showed the Mechanical Wood Pulp (MWP) content was below 65%, meaning the goods did not qualify as newsprint.

The appellate tribunal noted that the Revenue relied on Indian Standard IS 5285/1998 rather than the ISO standard. It was also observed that the BIS standard considered fewer plant species compared to ISO 9184. During cross-examination, the analysts admitted the tests were not done according to ISO norms but as per BIS standards.

The tribunal found merit in the assessee's argument that applying different standards could distort test results. Citing the Supreme Court’s decision in Tata Chemicals Ltd. v. Commissioner of Customs (Preventive), Jamnagar, it held that test results not based on the prescribed method cannot be relied upon.

Relief for Mahindra: CESTAT Rules CENVAT Credit on Factory Canteen Services Admissible Except for Employee-Recovered Amounts

M/s Mahindra And Mahindra Ltd. vs Commissioner of Central Excise 2025 TAXSCAN (CESTAT) 876

The appellant, a manufacturer of tractors and related components, had availed CENVAT credit on outdoor catering services during the period October 2008 to August 2009. The credit was claimed on the basis of the Larger Bench ruling in CCE, Mumbai-V v. GTC Industries Ltd., which held that such services used for employee canteens were covered under the definition of "input service."

The two-member bench comprising Justice DilipGupta, President (Judicial Member) and P. Anjani Kumar (Technical Member) disagreed with the department’s stand. It held that denial of the entire credit on the ground of missing bifurcation was not sustainable, especially when the appellant had produced CA certificates showing the actual recovery.

Relief for Bata India: CESTAT Rules MRP Valuation Not Applicable on Institutional Sales, Quashes Excise Duty Demand

M/s. Bata India Limited vs Commissioner of GST and CentralExcise 2025 TAXSCAN (CESTAT) 877

Bata India Limited, the appellant, is a manufacturer of footwear and had cleared its products during the period from January 2009 to December 2013 to various institutional buyers such as JSW Ltd., Exide Batteries Ltd., and HAL.

The two-member bench comprising Justice Dilip Gupta (President) and P.V. Subba Rao (Technical Member) explained that Section 4A applies only when goods are sold in retail and there is a legal requirement to declare the MRP. Since the buyers in this case were institutions and not retail consumers, the sales could not be valued under Section 4A of the Central Excise Act.

The tribunal also found that the department had not shown any evidence that the MRP was recovered or that any excess amount was received beyond the transaction value. It stated that CBEC’s own circulars and established judicial rulings clarified that MRP-based valuation is not applicable when goods are sold to unrelated institutional buyers.

Relief for SAIL: CESTAT Grants Exemption on Captive Use of Steel Items for Internal Roads and Maintenance Activities

M/s Steel Authority of India Limited vs Commissioner of CGST& Central Excise, Bolpur 2025 TAXSCAN (CESTAT) 878

Steel Authority of India Limited,appellant-assessee, operated an integrated steel plant in Durgapur, West Bengal, and was engaged in manufacturing and selling iron, steel, and related products under various chapters of the Central Excise Tariff.

The appellate tribunal observed that damaged roads could disrupt production, especially those running alongside railway tracks, and thus had a direct bearing on manufacturing activity.

Alleged DFIA Authorization Misuse for Textile Imports: CESTAT remands Matter considering conflict with test report of CRCL with Textile Committee

Titanium Ten Enterprises Pvt Ltd vs Commissioner of Customs(Export) 2025 TAXSCAN (CESTAT) 879

The assessee, Titanium Ten Enterprises had imported cotton fabrics under the Duty-Free Import Authorization (DFIA) scheme of the Foreign Trade Policy. The Textile Committee had issued a test certificate affirming that samples drawn complied with the authorized description, thereby permitting duty-free clearance.

The two-member bench comprising Members C.J. Mathew (Technical) and Ajay Sharma (Judicial) held that the conflict between the Textile Committee’s test report and subsequent analysis by the Central Revenue Control Laboratory (CRCL) gave rise to serious questions of natural justice, that require a fresh, conclusive testing before any duty-assessment could be confirmed.

The Bench observed that “the acceptance of the subsequent CRCL report for arriving at the impugned decision without ascertaining its unqualified veracity runs contrary to the principles of natural justice”.

Relief for JSW Steel: CESTAT Rules Corrigendum Issued After 5 Years to Original SCN Amounts to Fresh Notice, Quashes Demand as Time-Barred

JSW STEEL LTD vs COMMISSIONER OF CUSTOMS-GOA 2025 TAXSCAN (CESTAT) 880

JSW Steel Ltd, the appellant, had exported consignments of hot rolled and cold rolled non-alloy steel coils in April and May 2008. Most of the consignments were cleared before the imposition of new export duties under Notification No. 66/2008-Cus dated 10 May 2008, but five shipping bills were cleared on the day the notification came into effect.

The tribunal comprising Dr. Suvendu Kumar Pati (Judicial Member) and Anil G. Shakkarwar (Technical Member) explained that the corrigendum had materially altered the contents of the original notice, including key figures and legal basis.

The tribunal pointed out that such alterations, made after a gap of five years, could not be treated as simple corrections and had the effect of issuing a fresh notice. The revised content formed the actual basis of adjudication, and the corrigendum came well after the permissible limitation period, so the tribunal ruled that the demand was time-barred.

Relief for One97: CESTAT Rules Paytm Soundbox is a 2G Device Not 4G/LTE Compliant, Quashes Customs Duty Demand

One97 Communications Limited vs Principal Commissioner ofCustoms

2025 TAXSCAN (CESTAT) 881

One97 Communications Limited, the appellant, had imported Paytm Soundbox devices and claimed concessional basic customs duty at 10 percent under Serial No. 20 of Notification No. 57/2017-Cus. The customs department denied the benefit by alleging that the Soundbox was 4G/LTE and MIMO compliant and thus fell within the exclusion clause of the notification.

MRP Labelling Not Mandatory for Industrial Use or Packages Above 25 Kg/Litre: CESTAT in BEML Case

M/s.BEML Ltd. vs The Commissioner of Customs 2025 TAXSCAN (CESTAT) 882

BEML Ltd (Bharat Earth Movers Limited), the appellant, imported spares and components between April 2010 and November 2011. The customs department assessed additional customs duty on these goods by applying MRP-based valuation under Section 3 of the Customs Tariff Act, citing Notification No. 49/2008-Cus and the absence of declared MRP on the packages.

The bench comprising Justice P. Dinesha (Judicial Member) and M. Ajit Kumar (Technical Member) explained that the Legal Metrology and Packaged Commodities Rules apply only to retail packages, and that Rule 34 specifically excludes packages intended solely for industrial use.

Partial Relief for British Airways: CESTAT Upholds Service Tax on Excess Baggage Charges for Normal Period, Drops Demand for Extended Period

M/s British Airways PLC India Branch vs Commissioner of CentralGoods & Service Tax 2025 TAXSCAN (CESTAT) 883

British Airways PLC, India Branch, the appellant, is engaged in the business of transporting passengers by air. The department issued show cause notices alleging non-payment of service tax on excess baggage charges (EBC) collected from passengers during the financial years 2007-08 to 2012-13.

The tribunal held that the matter was interpretational and all facts were disclosed, so the extended period could not be invoked. It also found that there was no mens rea and penalties were not warranted.

The tribunal partly allowed the appeal. It confirmed the service tax demand on excess baggage charges for the normal period but set aside the demand raised for the extended period. The penalties were also deleted.

Relief for Suzuki: CESTAT Rules Excess Transit Insurance Charges Collected Excluded from Assessable Value, Not Liable to Excise Duty

Commissioner of C G S T vs M/s Suzuki Motorcycle India Pvt Ltd 2025 TAXSCAN (CESTAT) 884

Suzuki Motorcycle India Pvt. Ltd., the respondent, is engaged in the manufacture of motorcycles, scooters, and their parts. The respondent availed the facility of CENVAT credit under the CENVAT Credit Rules, 2004.

The two-member bench comprising S.S. Garg (Judicial Member) and P. Anjani Kumar (Technical Member) observed that as per the dealership agreement, the goods were sold at the factory gate, and the dealers were responsible for taking delivery and arranging transportation. The tribunal observed that the title and risk in the goods passed at the factory gate, and the insurance charges collected later were not related to the sale or manufacture of the goods.

The tribunal explained that under Section 4(1)(a) of the Central Excise Act, the assessable value of excisable goods is the transaction value at the place and time of removal. The tribunal explained that the place of removal was the factory gate, and the insurance charges collected after that point could not be included in the assessable value. The tribunal further observed that these charges were like profit and had no nexus with manufacturing activity.

Relief for Indian Oil: CESTAT Holds No Service Tax Payable on Reimbursable Expenses Incurred for CISF Security Services

M/s Indian Oil Corporation Ltd vs Commissioner of Central ExciseAnd Service Tax 2025 TAXSCAN (CESTAT) 885

Indian Oil Corporation Ltd., the appellant, had engaged CISF for providing security at its facilities in Panipat and Sonepat. The appellant reimbursed CISF for expenses including rent-free accommodation, medical benefits, lease accommodation, telephone bills, vehicle usage, stationery, and other incidental charges.

The two-member bench comprising S.S. Garg (Judicial Member) and P. Anjani Kumar (Technical Member) observed that the facts and issues were identical to those decided by the Ahmedabad Bench.

In the Ahmedabad ruling, the tribunal had observed that the expenses incurred by the appellant were reimbursed on an actual basis and were not part of the consideration for security services. The bench explained that under Section 67 of the Finance Act, 1994, only the amount charged as consideration for the service is taxable, and not additional reimbursements or free facilities provided by the recipient.

Smuggling of Gold Concealed Behind Car Arm Rest Without Licit Documents: CESTAT Upholds Confiscation and Penalty u/s 112(b)

Md. Altaf vs Commissioner of Customs (Prev.), Kolkata 2025 TAXSCAN (CESTAT) 886

Md. Altaf,appellant-assessee,was intercepted by the DRI on 27.08.2019 at around 17:20 hrs while travelling in a white Hyundai Verna (WB 20AZ7971) from Kolkata towards the Vidyasagar Setu Toll Plaza. Acting on specific intelligence, officers questioned the occupants about carrying contraband, which they initially denied.

The two member bench comprising Ashok Jindal (Judicial Member) and K.Anpazhakan (Technical Member) heard the parties and perused the record. It found that during the investigation, the assessee were found carrying the impugned gold in the vehicle they were travelling in, concealed in a specially built cavity behind the rear seat armrest.

Customs Fails to Prove 2019 Order Served: CESTAT Treats 2021 Attested Copy as Service Date, says Appeal File on Time

Shri Hira Lal Prasad vs Commissioner of Customs 2025 TAXSCAN (CESTAT) 887

Hira Lal Prasad, appellant-assessee, had filed an appeal before the Commissioner (Appeals) on 05.04.2021, challenging the Order-in-Original dated 20.09.2019. The assessee submitted that the said order, dated 20.09.2019/23.09.2019, was never received.

It was observed that the department failed to provide proof of service of the original order and still issued an attested copy in March 2021. The tribunal held that mere despatch is not proof of service, the actual date of service of order needs to be proved.

The appellate tribunal found that the appeal was filed on time and there was no delay on the assessee's part. It sent the matter back to the Commissioner (Appeals) with instructions to follow principles of natural justice and complete the proceedings within three months.

Relief for Hyundai: CESTAT Holds Extended Limitation Not Invocable When Classification Dispute Exists Within Customs Dept

Hyundai Transys India Pvt. Ltd vs Commissioner of Customs 2025 TAXSCAN (CESTAT) 888

Hyundai Transys imported polyurethane sheets used exclusively in the manufacture of car seats and classified them under CTH 3926 9099, claiming FTA benefits under Notification No. 152/2009-Cus. The Special Intelligence and Investigation Branch (SIIB) alleged misclassification stating the goods should be classified under CTH 3921 1390, which would not qualify for the FTA benefit.

The tribunal further observed that the classification dispute existed even within the customs department, as Chennai authorities classified the goods under CTH 3921 1390, while Bangalore authorities classified them under CTH 3926 3090.

The tribunal pointed out that the extended limitation under Section 28(4) requires deliberate intent to evade duty and that a difference in classification opinion does not establish suppression or willful misstatement.

Mandatory UK Registration Does Not Deny ‘New Car’ Status: CESTAT Grants 60% Concessional Duty on Imported Bentley

Jatin Ahuja vs Commissioner of Customs 2025 TAXSCAN (CESTAT) 889

Jatin Ahuja, Director of Big Boyz Toyz, imported a Bentley Flying Spur Automatic from the United Kingdom in October 2009 for personal use. The declared value was Rs. 73.84 lakh, based on an invoice from A.K. International (IE) Ltd., UK, quoting GBP 91,500.

The division bench comprising S.K. Mohanty (Judicial Member) and P.V. Subba Rao (Technical Member) reviewed the Port Health Officer’s inspection report at the time of import which confirmed the vehicle was unused and in new condition.

The tribunal confirmed that the car was new when imported, and mandatory UK registration was a legal formality, not proof of use.

Sugar Cess on Imported Raw Sugar is ‘Duty of Excise’, Not Fee: CESTAT rules Eligible for CENVAT Credit

M/s A B Sugar Ltd vs Commissioner of Central Excise and ServiceTax 2025 TAXSCAN (CESTAT) 890

A B Sugar Ltd., the appellant, is engaged in manufacturing sugar. In February 2010, it imported raw sugar and paid sugar cess at the rate of Rs. 24 per quintal under Section 3(1) of the Sugar Cess Act, 1982. The company treated this cess as a duty of excise and availed CENVAT credit of Rs. 62,40,000 on it.

The two-member bench comprising S.S. Garg (Judicial Member) and P. Anjani Kumar (Technical Member) observed that the Karnataka High Court in Shree Renuka Sugars had clearly held that sugar cess is a duty of excise levied at the stage of production and that the countervailing duty equivalent to sugar cess paid on imports is eligible for CENVAT credit. The tribunal explained that since the High Court’s judgment had not been stayed, it was binding on the tribunal.

The tribunal set aside the Commissioner’s order and allowed the appeal, holding that the appellant was entitled to CENVAT credit of sugar cess paid on imported raw sugar.

Stock Transfers of Explosives to WB and Jharkhand Depots are Branch Transfers, Not Inter-State Sales: CESTAT

M/s Solar Industries India Ltd vs State of Maharashtra 2025 TAXSCAN (CESTAT) 891

Solar Industries India Ltd., the appellant, is engaged in the manufacture and trade of industrial explosives. The company participates in Coal India’s tender process and enters into running contracts that fix prices and maximum supply quantities, but do not guarantee purchase obligations.

The tribunal found IDL Chemicals distinguishable on facts and agreed with the principles explained in Keltech Energies and BASF India.

The tribunal ruled that these were branch transfers under Section 6A of the CST Act, not inter-State sales. It set aside the order of the Maharashtra Sales Tax Tribunal and allowed all six appeals filed by the appellant.

Excess Service Tax Paid can be Adjusted Beyond Immediate Succeeding Month or Quarter u/r 6(4A): CESTAT in BSNL Case

M/s. Bharat Sanchar Nigam Ltd., Motihari vs Commissioner ofCentral Excise & Service Tax 2025 TAXSCAN (CESTAT) 892

Bharat Sanchar Nigam Ltd. (BSNL), the appellant, was engaged in providing telecommunication services. A previous order of the tribunal had remanded the matter for reconciliation of service tax payments, Cenvat credit, and liabilities.

The bench comprising Ashok Jindal (Judicial Member) and K. Anpazhakan (Technical Member) observed that Rule 6(4A) states excess payment can be adjusted against the succeeding month or quarter but does not say it must be the immediate succeeding period.

The tribunal pointed out that there was no dispute on the reconciled figures between the parties and that the refund claim could be allowed if BSNL satisfied the unjust enrichment requirement.

SSI Exemption Limit Should Be Calculated Excluding 60% Abatement on Restaurant Services: CESTAT

Brothers Dhaba vs Commissioner of Central Excise 2025 TAXSCAN (CESTAT) 893

Brothers Dhaba, the appellant, is registered with the service tax department under “Restaurant Services.” On scrutiny of its service tax returns for the year 2014-15, the department found that the appellant had availed SSI exemption on turnover of Rs. 24,75,391, exceeding the prescribed limit of Rs. 10 lakh.

The single-member bench comprising S. S. Garg (Judicial Member)explained that restaurant services enjoy 60% abatement under the notification, and only the remaining 40% is subject to tax. When the turnover is calculated on this abated value, the appellant falls within the SSI exemption limit.

The tribunal pointed out that the issue was already covered by the decision in Shri Ashok Kumar Mishra, which clarified that the exempted portion should not be included in the computation of aggregate value for SSI exemption. Following the earlier decision, the tribunal set aside the impugned order and allowed the appeal with consequential relief as per law.

Relief for Robin Uthappa: CESTAT Rules IPL Payments Are ‘Player Fee’, Not Taxable as Promotional Activity Under BAS

Shri Robin Uthappa vs The Commissioner of Central Excise 2025 TAXSCAN (CESTAT) 894

Robin Uthappa, the appellant, is a professional Indian cricketer who entered into an agreement with Royal Challengers Sports Pvt. Ltd. (RCSPL) to play in IPL matches. He received payments under the contract, which were described as ‘player fee’ based on his participation in the matches.

The two-member bench comprising P.A. Augustian (Judicial Member) and R. Bhagya Devi (Technical Member) referenced the case of Sourav Ganguly v. CCE, where the tribunal observed that payments received by the cricketer were solely for playing cricket in terms of the agreement with the franchise, and not for any brand promotion activity.

The tribunal further observed that wearing jerseys with sponsor logos did not amount to rendering taxable service under ‘Business Auxiliary Services’, as there was no contractual obligation to promote or endorse any brand.

Relief to JSW Steel: CESTAT allows Refund of CVD and SAD paid post July 2017 u/s 142(3) of CGST Act

JSW Steel Limited vs Commissioner of CGST & Central Excise 2025 TAXSCAN (CESTAT) 895

JSW Steel Limited,appellant-assessee manufactured steel and imported iron ore through 17 Bills of Entry under provisional assessment. After the assessments were finalized, it paid CVD and SAD of ₹9,80,040 between July 2018 and July 2019 but could not claim CENVAT credit as it was discontinued under GST.

A single member bench of Dr.Suvendu Kumar Pati (Judicial Member) examined the submissions and relevant case laws on refund of CVD and SAD paid in cash under Section 142(3). It noted that the Larger Bench in the Bosch Automotive Electronics case allowed such refunds.

Relief for HUL: CESTAT rules 'Management Consultancy' and 'Business Support Services' Qualify as Input Services for CENVAT Credit

M/s.Hindustan Unilever Ltd vs The Commissioner of GST &Central Excise 2025 TAXSCAN (CESTAT) 896

Hindustan Unilever Ltd., the appellant, is engaged in the manufacture of soaps and detergents at its Puducherry unit. The appellant availed CENVAT credit based on Input Service Distributor (ISD) invoices issued by its Mumbai head office for various input services during the period from August 2010 to June 2011.

The two-member bench comprising P. Dinesha (Judicial Member) and M. Ajit Kumar (Technical Member) observed that the inclusive definition of input service under Rule 2(l) covered various services used in or in relation to business operations.

The tribunal referred to the decisions of both the Bombay and Madras High Courts, which had upheld a broader interpretation of input services. The tribunal pointed out that the department had accepted similar services as eligible and had not appealed against those parts of the order.

Setback for Pigeon India: CESTAT rejects ₹17.25 Lakh Excise Duty Refund for Not Challenging Self-Assessment

M/s Pigeon India Pvt. Ltd vs Commissioner of Customs &Central Excise 2025 TAXSCAN (CESTAT) 897

Pigeon India Pvt. Ltd., the appellant, is engaged in the manufacture of products such as glass bottles, baby soaps, and other baby care items. The appellant filed a refund claim of Rs. 17,25,830 under Section 11B of the Central Excise Act, 1944, stating that excess duty was paid at the time of clearance of finished goods between July and November 2015.

The single-member bench comprising Sanjiv Srivastava (Technical Member) observed that under the Supreme Court decision in ITC Ltd., refund claims are not maintainable unless the self-assessment order is first challenged and modified through proper legal proceedings.

The tribunal pointed out that refund provisions are in the nature of execution and do not permit reassessment of duty. The tribunal explained that once the self-assessment stands, it cannot be reopened through a refund claim.

Excess Service Tax Paid can be Adjusted Beyond Immediate Succeeding Month or Quarter u/r 6(4A): CESTAT in BSNL Case

M/s. Bharat Sanchar Nigam Ltd vs Commissioner of Central Excise& Service Tax 2025 TAXSCAN (CESTAT) 898

Bharat Sanchar Nigam Ltd. (BSNL), the appellant, was engaged in providing telecommunication services. A previous order of the tribunal had remanded the matter for reconciliation of service tax payments, Cenvat credit, and liabilities.

The bench comprising Ashok Jindal (Judicial Member) and K. Anpazhakan (Technical Member) observed that Rule 6(4A) states excess payment can be adjusted against the succeeding month or quarter but does not say it must be the immediate succeeding period.

Relief for Tata Teleservices: CESTAT Rules Group Mediclaim, Accident, and Vehicle Insurance Eligible for CENVAT Credit

Tata Teleservices (Maharashtra) Ltd vs Commissioner of ServiceTax 2025 TAXSCAN (CESTAT) 899

Tata Teleservices (Maharashtra) Ltd., the appellant, availed CENVAT credit of Rs. 88,53,123 on service tax paid towards these insurance services during 2007-08 to 2011-12. The department denied the credit, arguing that there was no statutory obligation to provide such insurance, and treated them as non-business, welfare expenses. The adjudicating authority confirmed the demand with interest and penalty.

The two-member bench comprising C.J. Mathew (Technical Member) and Ajay Sharma (Judicial Member) observed that there was no finding suggesting that accident insurance covered activities beyond the workplace and no evidence to show that the vehicles were used for personal purposes.

Delay in Filing Service Tax Appeal Due to Tax Officer’s Failure to Reissue Login Credentials in Time: CESTAT Condones 26-Day Delay

Car Clinic vs Commissioner of Central Excise, Goods &Service Tax 2025 TAXSCAN (CESTAT) 900

Car Clinic, the appellant, is registered with the service tax department for providing repair, conditioning, restoration, decoration, or other services for motor vehicles. Based on third-party data received from the Income Tax Department for the years 2015-16 to 2017-18, the department observed differences between the gross receipts shown in income tax data and those declared in service tax returns.

The single-member bench comprising S. S. Garg (Judicial Member) observed that the delay in filing was indeed caused by the technical glitches and the tax officer’s failure to reissue the login credentials, which prevented the appellant from meeting the deadline of 22.01.2023. The tribunal found that such circumstances warranted condonation.

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