CESTAT Weekly Round-up

This weekly round-up analytically summarizes the key stories related to the Customs Excise and Service Tax Appellate Tribunal (CESTAT) reported at Taxscan from August 11, 2025 to August 16, 2025.

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

Md. Altaf vs Commissioner ofCustoms (Prev.), Kolkata CITATION : 2025 TAXSCAN (CESTAT) 886

The Kolkata Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) upheld the confiscation of gold and penalty under Section 112(b) of the Customs Act, 1962, after the assessee failed to produce licit documents proving lawful possession of gold concealed behind the rear seat armrest of a car. 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

The Kolkata Bench of Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) held that the department failed to prove service of the Order-in-Original dated September 2019 and accepted the date of issuance of an attested copy in March 2021 as the actual date of service. 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.

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

The Chennai Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) set aside a customs duty demand against Hyundai Transys India Pvt. Limited holding that the extended limitation period under Section 28(4) of the Customs Act, 1962, was not invocable since the dispute related to classification and there was a difference of opinion even within the customs department. 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.

Comprehensive Guide of Law and Procedure for Filing of Income Tax Appeals, Click Here

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

The Delhi Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) ruled that a car imported into India remains “new” for customs purposes even if it was registered abroad before export, provided the registration was a legal requirement and the car was unused. The appellant’s counsel argued that UK law required mandatory registration before export, which did not imply that the car was used. The car’s minimal mileage and inspection findings proved it was new. They argued that mandatory registration abroad does not affect “new” status for customs purposes.

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

The Chandigarh Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) ruled that sugar cess paid on imported raw sugar qualifies as a duty of excise and is eligible for CENVAT credit. 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.

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

M/s Solar Industries India Ltdvs State of Maharashtra CITATION : 2025 TAXSCAN (CESTAT) 891

The Mumbai Bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) ruled that the movement of explosives from Maharashtra to company depots in West Bengal and Jharkhand under a running contract with Coal India Ltd. constituted branch transfers and not inter-State sales. The two-member bench comprising Mr. JusticeDilip Gupta (President) and Mr. P.V. Subba Rao (Technical Member) observed that there was no one-to-one correlation between goods moved from Nagpur and goods sold to collieries. The movement to depots was an internal stock transfer, with appropriation occurring only at the depot before local sale.

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

The Kolkata Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) ruled that excess service tax paid can be adjusted beyond the immediate succeeding month or quarter under Rule 6(4A) of the Service Tax Rules, 1994. 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.

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

The Chandigarh Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) ruled that while calculating the SSI exemption limit for restaurant services, 60% of the value eligible for abatement should be excluded from the computation. The counsel submitted that only the remaining 40% value is taxable, and after applying abatement, the turnover falls within the Rs. 10 lakh SSI exemption limit. The tribunal relied on Shri Ashok Kumar Mishra v. CCE & ST, Allahabad, where in an identical matter it was held that the abated portion of the value, being exempt from service tax, should not be considered for SSI threshold calculation.

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

The Bangalore Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) ruled that payments received by a professional cricketer for participating in Indian Premier League (IPL) matches are ‘player fee’ and cannot be considered as promotional activity taxable under the category of ‘Business Auxiliary Services’ (BAS). 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 for HUL: CESTAT rules 'Management Consultancy' and 'Business Support Services' Qualify as Input Services for CENVAT Credit

The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) ruled that 'Management or Business Consultant’s Service' and 'Business Support Service' qualify as input services and are eligible for CENVAT credit under Rule 2(l) of the CENVAT Credit Rules, 2004. The counsel relied on the decision of the Bombay High Court in Coca Cola India Pvt. Ltd. v. CCE, which held that business is an ongoing activity and the definition of input service includes a wide range of activities relating to business,

Comprehensive Guide of Law and Procedure for Filing of Income Tax Appeals, Click Here

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

The Mumbai Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) ruled that group mediclaim for employees and their families, personal accident insurance, and vehicle insurance qualify as ‘input services’ under the CENVAT Credit Rules, 2004. The tribunal also referred to the decision of the Larger Bench in PTC Software, which held that mediclaim insurance for employees and their families qualifies as input service and that it is not necessary to show a direct connection between the service and the manufacturing activity for the pre-2011 period.

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

The Allahabad Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) ruled that a refund claim for excess excise duty is not maintainable unless the underlying self-assessment is first challenged through appropriate legal channels. 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.

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

The Mumbai Bench of Customs,Excise and Service Tax Appellate Tribunal ( CESTAT ) granted relief to JSW Steel by permitting the refund of Countervailing Duty (CVD) and Special Additional Duty (SAD ) paid in cash after July 2017 under Section 142(3) of the Central Goods and Service Tax ( CGST ) Act. It relied on earlier decisions that held taxpayers were eligible for Cenvat Credit and that refunds could be given if no unjust enrichment occurred, as seen in the OSI Systems case. The bench rejected conflicting decisions cited by the authorized representative because they were made before the Larger Bench ruling in Bosch Electrical Drive.

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

The Chandigarh Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) ruled that the dismissal of an appeal as time-barred was not justified when the delay was caused by the tax officer’s inability to reissue login credentials in time, which prevented the appellant from filing the appeal within the prescribed period. 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.

Relief for Apollo Tyres: CESTAT Rules Extended Limitation Inapplicable When Packaging Practice Unchanged for 25 Years

The Chennai Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) ruled that the extended limitation period under the Central Excise Act cannot be applied when the assessee’s packaging practice has remained unchanged for over twenty-five years and was previously accepted by the department. The revenue counsel argued that the strapped sets satisfied the definition of “pre-packaged commodities” and that the commissioner’s findings supported valuation under Section 4A. They also argued that identical products were valued differently, justifying the extended limitation period.

Setback for JSW Energy: CESTAT Rules Final Customs Assessments Cannot Be Reopened Without Statutory Appeal, Rejects Refund Claim

The Hyderabad Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) ruled that the adjudicating authority cannot reopen a final customs assessment without a statutory appeal under Section 128 of the Customs Act, 1962. The revenue counsel countered that once a final assessment is issued, it can only be modified through a statutory appeal and not through refund claims, and that Sections 149 and 154 apply only to clerical or document errors, not to reopening assessments.

No Service Tax on Packing of Bulk pack into Retail Packs as Job Work, amounts to Manufacture: CESTAT deletes Demand, Penalty and Interest

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Kolkata bench, has recently set aside service tax demands, penalties, and interest imposed on M/s Emami Limited and its contractors, holding that the activity of packing bulk goods into retail packs constitutes "manufacture" under the Central Excise Act, 1944, and is therefore outside the ambit of service tax. Key evidence cited by the department included contractors’ statements, wage calculation sheets, profit and loss accounts, GST registration details, and trade licenses indicating “labour contractor” activities. Emami and the contractors challenged the admissibility of these statements, noting that they were later retracted and not tested under Section 9D of the Central Excise Act.

Comprehensive Guide of Law and Procedure for Filing of Income Tax Appeals, Click Here

Customs Brokers Not Liable if Client Shuts Down After Verified Transactions: CESTAT Rules No Violation Under Regulation 10(n)

The New Delhi Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) ruled that a customs broker cannot be held liable under Regulation 10(n) of the Customs Broker Licensing Regulations, 2018 if a client ceases operations after the broker has completed verification based on valid government-issued documents at the time of the transactions. Regarding Lalit Enterprises, the tribunal observed that the GSTIN and IEC were valid at the time of transactions and that Regulation 10(n) allows verification through reliable documents without mandating physical inspection. The tribunal pointed out that the regulation does not impose a duty of continuous surveillance after initial verification.

CESTAT Abates Service Tax Appeal against Vasan Dental Hospitals since Company is Undergoing Liquidation

The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has abated the Service Tax appeal filed by the Department, noting that the company is under liquidation and no application for continuance has been made by the official liquidator. The Tribunal noted that the National Company Law Tribunal (NCLT) had ordered liquidation of the respondent company. Referring to the Supreme Court’s ruling in Ghanshyam Mishra (2021), it reiterated that once a Resolution Plan is approved, all claims not part of the plan stand extinguished, and no further proceedings can be initiated.

Relief for Shipping Corporation of India: CESTAT Rules Demurrage is Part of Exempt Transport Service, Quashes ₹49.44 Cr Service Tax Demand

The Mumbai Bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) ruled that demurrage charges collected by the Shipping Corporation of India (SCI) are part of the transport contract and not taxable as a declared service, quashing the service tax demand of Rs. 49.44 crore. The corporation’s counsel argued that demurrage arose from charter party provisions on laytime and was intended to deter delays in loading or unloading. They explained that it was part of the transport contract and not an independent agreement to tolerate an act. They also pointed out that the main transportation service was exempt, so the associated demurrage could not be taxed.

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