Half-Yearly Customs, Excise and Service Tax Case Digest: CESTAT Decisions 2025 [Part I]

Loading Activities in Mining Area does not Qualify as Cargo HandlingServices: CESTAT M/s. Shree Mohangarh Sharmik Theka Sahkari Samiti Ltd. vs Commissioner of Central GST CITATION: 2025 TAXSCAN (CESTAT) 101

In a recent ruling, the New Delhi bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) held that loading and unloading activities conducted in a mining area do not fall under the category of ‘cargo handling services.’

The CESTAT observed that the Supreme Court in the case of Chowgule and Co. Pvt. Ltd. vs. Union of India, held that process of extraction of ores from mines washing, screening, crushing in the crushing plant and stacking at the mining site all are covered under the Mines Act, 1952,and cannot be called as ‘Cargo Handling Service

The bench accepted the contention raised by the counsel of assessee that the SCN was time- barred.

CESTAT sets aside Penalty as Amnesty Scheme does not Prescribe Penaltiesfor Settled Cases, Citing Closure Letter issued after Compliance M/s.Makwuds India Private Limited vs The Commissioner of Customs CITATION: 2025 TAXSCAN (CESTAT) 102

The Chennai Bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) overturned the penalties ruling that the Amnesty Scheme does not provide for penalties in cases that have been settled when authorities have issued a closure letter confirming compliance.

The revenue counsel argued that the appellant had discharged the duty and interest obligations as per the adjudication order and the Amnesty Scheme but the penalty imposed under Section 112(a) of the Customs Act was still valid.

The two-member bench comprising P. Dinesha (Judicial Member) and Vasa Seshagiri Rao (Technical Member) observed that the scheme was to resolve defaults in export obligations without treating them as irregularities or implying malafide intent. The bench observed that the closure letter issued by the authorities showed full compliance with the scheme and no penalty was prescribed in the Amnesty Scheme.

So, the tribunal ruled that the penalty under Section 112(a) was unsustainable. The impugned order was set aside and the appellant’s appeal was allowed.

CESTAT restores Suspended License of CHA in absence of Proof forViolation of CBLR M/s.V.J.P. Shipping India Pvt. Limited vs The Commissioner of Customs CITATION: 2025 TAXSCAN (CESTAT) 108

In a recent case, the Chennai bench of Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) set aside the order suspending Customs House Agent ( CHA )‘s license in absence of proof for violation of Customs Broker Licensing Regulations ( CBLR ), 2018 and directed to restore the suspended license.

It was viewed that the balance of inconvenience is clearly with the appellants and hence, the Revenue would not in any way be affected if the order of suspension of their license set aside, thereby permitting them to continue with their business.

Accordingly, a two member bench of P. Dinesha, Member (Judicial) and M. Ajit Kumar, Member (Technical) set aside the order suspending the license of the appellants. The authority below can always go ahead since there has been an initiation of a proceedings, and conclude the same in accordance with law thereafter.

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AO Insisting Importer Opting for Classification proposed by investigating agency is contrary toprescription of self-assessment S. 17 of Customs Act: CESTAT Daikin Airconditioning India Pvt Ltd vs Commissioner of Customs CITATION: 2025 TAXSCAN (CESTAT) 105

In a ruling by Mumbai bench of the Customs, Excise And Service Tax Appellate Tribunal (CESTAT), has held that Assesssing Officer (AO) insisting importer opting for classification proposed by investigating agency is contrary to prescription of self-assessment Section 17 of Customs Act, 1962.

It was the first appellate authority’s responsibility to ensure that the “proper officer” complied with the law in these circumstances. If this was not done, the orders that are now being contested before us have the same stain of illegality. In view of the circumstances above, affirmation of the impugned order would be tantamount to participation in breach of law. That suffices to merit setting aside the impugned order and to restore the bills of entry before the original authority for compliance with the procedure set out in section 17 of Customs Act, 1962 and, in particular, section 17(5) therein.

Mis-declaration to DGFT does not fall within the purview of S. 114AA ofthe Customs Act: CESTAT S.B. AGARWAL vs COMMISSIONER OF CUSTOMS CITATION: 2025 TAXSCAN (CESTAT) 104

In a recent ruling, the Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) held that the alleged misdeclaration by the appellant to the Directorate General of Foreign Trade ( DGFT ) did not fall within the purview of Section 114AA of the Customs Act, 1962.

The CESTAT observed that Section 114AA of the Customs Act, 1962 penalizes false declarations made knowingly or intentionally in proceedings under the Customs Act. It held that the alleged misdeclaration by the appellant to DGFT was not a declaration in a proceeding under the Customs Act but instead under the Foreign Trade Policy and thus, the the section was inapplicable.

Dept must Automatically Return EDD upon Finalizing ProvisionalAssessment without Requiring Refund Application: CESTAT Herrenknecht India Pvt. Ltd. Vs Commissioner of Customs CITATION: 2025 TAXSCAN (CESTAT) 106

The Chennai Bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) ruled that the refund of Extra Duty Deposit ( EDD ) is not subject to the limitation under Section 27 of the Customs Act, 1962, and should be returned upon finalization of provisional assessments without requiring a formal refund claim.

The tribunal ruled that the department was obligated to refund the EDD after the final assessment and rejected the impugned order. For the BOE missing the TR6 challan, the tribunal directed the department to process the refund upon submission of an indemnity bond, as per departmental procedure. The appeal was allowed with consequential relief.

Refund for Unutilized CENVAT Credit Rejected Over Lack of Input-outputNexus: CESTAT Partially Remands Matterfor Further Document Submission M/s AMD Research & Development Vs Pr. Commissioner of Central Tax & Customs CITATION: 2025 TAXSCAN (CESTAT) 107

The Hyderabad Bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) partially remanded the matter concerning refund claims for unutilized CENVAT credit which had been rejected on grounds of lack of input-output nexus and procedural lapses, directing the appellant to produce further documentation for reassessment.

The tribunal found that input services except for a few had sufficient nexus with the appellant’s output services and were eligible for refund. It also found the denial of refunds due to incorrect formula application citing precedent in Commissioner of CGST & C.Ex, Mumbai v. Morgan Stanley Investment Management Pvt Ltd which required re-examination.

CESTAT sets aside Appeal against Air Asia on Issue of Customs DutyRefund citing Payment of Duty under Protest M/s. Air Asia (India) Private Limited vs Commissioner of Customs (Appeals) CITATION: 2025 TAXSCAN (CESTAT) 112

In a recent ruling, the Bangalore bench of the Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) sets aside the customs appeal on issue of refund duty paid by Air Asia based on re-classification of Aircraft parts, as the duty was already paid under protest.

In contrast to the current case, where the appellant paid the full duty under protest during the Bills of Entry assessment, the Commissioner (Appeals) has not decided the matter on merit and has dismissed the appeals based solely on the failure to make a pre-deposit of 7.5% of the duty, according to a two-member bench consisting of Mrs. R. Bhagya Devi, Member (Technical), and Dr. D.M. Misra, Member (Judicial).

Customs duty cannot be demanded jointly and severally: CESTAT quashespenalty u/s 114A RVS Petrochemicals Limited VS Commissioner of CUSTOMS - Kandla Customs CITATION: 2025 TAXSCAN (CESTAT) 111

Recently, the Ahmedabad bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) held that the customs duty could not be demanded jointly and severally and quashed the penalty that was levied against the appellant, RVS Petrochemicals Limited, under Section 114 A of the Customs Act, 1962.

It is to be noted that BGH settled its case with the Settlement Commission by agreeing to pay a differential duty of Rs. 1,05,23,322, along with interest and a penalty of Rs. 4,00,000. However, a penalty under Section 114A of the Customs Act was imposed, while the penalty under Section 112 was dropped. The appellants have now filed appeals seeking to set aside the Section 114A penalty. The appellant’s counsel contended that M/s BGH Exim Ltd. had paid the customs duty and its case was settled by the Settlement Commission. As no demand is payable by the appellants, joint and several liability cannot apply, and the penalty under Section 114A is not sustainable.

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Determination of Assessable value as per Rule 9 of Central Excise(Valuation) Rules not Applicable on Independent seller: CESTAT Commissioner of Central Goods And Service Tax VS Fie Spherotech CITATION: 2025 TAXSCAN (CESTAT) 114

The Mumbai bench of the Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) has held that determination of assessable value as per Rule 9 of the Central Excise ( Valuation ) Rules, 2000 is not applicable to independent sellers.

The Tribunal vide Final Order had disposed of three numbers of appeals. Against the said order passed by the Tribunal, the respondent herein had filed the Miscellaneous Application for rectification of mistake was allowed by the Tribunal, by way of recalling the Final Order dated 14.07.2022. Since, the Final Order in its entirety was recalled, Registry was confused about relisting of the matter for fresh hearing and accordingly, listed all the three appeals for hearing on 12.12.2024. However, on careful reading of both the Final Order dated 14.07.2022 and the Miscellaneous Order dated 25.07.2024, it was evident that appeals have already been disposed of by the Tribunal, in rejecting the said appeals filed by Revenue.

Demanding Tax which has already been paid by Service Recipient wouldlead to Double Taxation: CESTAT Shri Ballar Singh VS Commissioner, Central GST & Central Excise, Lucknow CITATION: 2025 TAXSCAN (CESTAT) 117

The Allahabad bench of the Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) held that demanding tax which has already been paid by service recipient would lead to double taxation. The bench found that the appellant assesee was under the bonafide belief that no service tax was payable as same is being paid by the service recipient UPRNN.

A single bench of P.K. Choudhary, Member (Judicial) observed that at the relevant time there were conflicting decisions of the Tribunal regarding payment of service tax by a sub-contractor or a sub-consultant and it is only when the Larger Bench decided the issue on May 23, 2019 that it was settled that a sub-contractor would have to discharge the service tax liability even if the main contractor had discharged the service tax liability.

Dept Empowered to Recover Escaped Customs Duty for Non-Compliance withPost-Importation Conditions in Exemption Notification: CESTAT M/s. Pentafour Solec Technologies Ltd. vs Commissioner of Customs CITATION: 2025 TAXSCAN (CESTAT) 118

The Chennai Bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) ruled that the Customs Department has the authority to recover escaped duty when post-importation conditions of an exemption notification are not fulfilled.

The tribunal upheld the confiscation of goods under Section 125 of the Customs Act, explaining that the physical availability of goods is not necessary for imposing redemption fines. Penalties were deemed reasonable considering the company’s violations and the involvement of its officials. The appeal was dismissed.

Value of material supplied for providing Taxable Services cannot beincluded in Value of Taxable services: CESTAT M/s Vividh Landscape Consultants (P) Ltd. vs Commissioner of Central Excise & Service Tax CITATION: 2025 TAXSCAN (CESTAT) 115

The Allahabad bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that the value of material supplied for providing taxable services cannot be included in the value of taxable services. The tribunal set aside the demand of service tax along with the penalties.

The said deduction of 70% was denied by the Commissioner and demand of service tax was confirmed on the assessee along with interest and penalty. The appeal preferred by the assessee was considered and decided by a three-member Special Bench of the Tribunal reported as Safety Retreading Company (P) Ltd. v. Commissioner of Central Excise, Salem, (2012) wherein coupled with the Notification No. 12/2003-S.T., dated 20-62003 a similar issue was considered by the Larger Bench of the Tribunal: “whether in a contract for retreading of tyres, service tax is leviable on the total amount charged for retreading including the value of the materials/goods that have been used and sold in the execution of the contract or exemption to material component therein can be granted”.

Difference in balance sheet and in ST-3 returns during same period: CESTAT remands to Decide on Payment ofService Tax due to difference M/s Vividh Landscape Consultants (P) Ltd vs Commissioner of Central Excise & Service Tax CITATION: 2025 TAXSCAN (CESTAT) 115

The Allahabad bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that the value of material supplied for providing taxable services cannot be included in the value of taxable services. The tribunal set aside the demand for service tax along with the penalties.

The Tribunal remanded the matter for ascertaining the factum of payment of service tax on account of the difference in the manner of the figures in the balance sheet which were higher than those in the ST-3 returns during the same period.

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Duty Exemption certificate cannot be invalidated as delay occurred inapplying before Ministry: CESTAT upholds Amendment of Bill of Entry u/s 149 ofCutoms Act Commissioner of Customs, Noida vs s Industrial Foams Pvt. Ltd CITATION: 2025 TAXSCAN (CESTAT) 116

In a recent case, the Allahabad bench of the Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) upheld the amendment of the bill of entry under Section 149 of the Customs Act, 1962, and held that duty exemption certificates cannot be invalidated as delay occurred in applying before the concerned ministry. The bench found that the respondent had taken all the necessary steps to obtain the said certificate well in advance which was being delayed in the concerned ministry, even the submission of that application and receipt thereof can be considered as a valid document.

Since Section 149 of the Act is sufficiently broad to address such exigencies, the denial of the modification for the reasons outlined in the appeal cannot be upheld, and as a result, the revenue’s appeal is without merit.

CENVAT Credit cannot be Denied for procedural lapses if substantialcompliance is met: CESTAT Sets aside Reversal of Rs. 16.12 Lakhs National Engineering Industries Limited vs Commissioner, CGST And Central Excise CITATION: 2025 TAXSCAN (CESTAT) 119

The New Delhi bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) held CENVAT credit cannot be denied for procedural lapses if substantial compliance is met and set aside the reversal of Rs. 16.12 lakhs against the appellant, National Engineering Industries Limited.

The Tribunal after relying on several judgements, held that such procedural errors should not undermine a taxpayer’s rights, especially when there was no doubt about the actual receipt of services or the payment of taxes.

Rule 9(1)(e) applicable for Reverse Charge Mechanism: CESTAT sets asideCenvat Credit denial of Rs. 32.95 lakh National Engineering Industries Limited VS Commissioner, CGST And Central Excise CITATION: 2025 TAXSCAN (CESTAT) 119

In a recent judgement, the New Delhi bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) held that Rule 9( 1 )( e ) of the Cenvat Credit Rules, ( CCR ), 2004 is applicable to Reverse Charge Mechanism ( RCM ) and set aside the denial of Cenvat credit amounting to Rs. 32.95 lakh against the appellant, National Engineering Industries Limited.

The CESTAT noted that Rule 9 ( 1 )( e ) of the Cenvat Credit Rules allows credit based on challans evidencing service tax payments under the Reverse Charge Mechanism. The bench noted that the department was wrong in applying Rule 9 ( 1 )( bb ) as this provision relates to supplementary invoices issued due to tax recoveries involving fraud or suppression.

Refund for Unutilized CENVAT Credit Rejected without Proper Notice:CESTAT Orders Re-Examination Citing Violation of Natural Justice M/s. Mylan Laboratories Limited vs Commissioner of GST & Central Excise CITATION: 2025 TAXSCAN (CESTAT) 121

The Chennai Bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) ruled that refund claims cannot be dismissed without issuing a proper show-cause notice or allowing the appellant an opportunity to present alleged deficiencies.

The tribunal set aside the orders of the adjudicating and appellate authorities, remanding the matter back to the original authority for fresh adjudication. The appeal was allowed.

CESTAT remands Issue on Exclusions made for Determining ‘Export Turnoveron the Services’ applying Formula A, Rules in favour of HSBC Electronic HSBC Electronic Data Processing vs Commissioner of Central Tax Rangareddy - GST CITATION: 2025 TAXSCAN (CESTAT) 125

The Hyderabad bench of the Customs, Excise And Service Tax Appellate Tribunal (CESTAT) in a recent ruling in favour of HSBC Electronic Data processing (India ) Ltd. remanded the issue on Exclusions made for Determining ‘export turnover on the services’ applying Formula A as per notification. The order was remanded back to the Original Sanctioning Authority, who shall take into account the observations and the Order passed by the Tribunal vide Final Order dt.17.01.2024 and thereafter, make necessary corrections in their record.

While allowing the appeal by way of remand, the tribunal also made clear that as a consequence of this exercise, there will not be any additional payment of refund.

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Service Recipient Liable for 100% Tax on Imports from Non-TaxableTerritory: CESTAT quashes Demand, cites Recipient’s Paid Tax already M/s. UTStarcom Inc. vs Commissioner of Service Tax – Delhi IV CITATION: 2025 TAXSCAN (CESTAT) 120

The New Delhi Bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) ruled that service recipients are liable for 100% tax on services imported from a non-taxable territory under the Reverse Charge Mechanism (RCM). As the Service Recipient (Reliance) already paid the tax, the tribunal quashed the demand order.

The tribunal held that the demand against the appellant was invalid as service tax liability had already been discharged and the SCN was time-barred. The appeal was allowed and the demand was set aside. To Read the full text of the Order CLICK HERE

Teflon Coating, Mat Fixing and Accessory fitting before 01.07.2012 notliable to Service Tax: CESTAT AVG Motors Ltd VS Commissioner of Central Excise CITATION: 2025 TAXSCAN (CESTAT) 122

The Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ), Bangalore in a recent matter held that Teflon Coating, Mat Fixing and Accessory fitting done before 01.07.2012 may not be liable to Service Tax.

Concludingly, the Bench attested to the Appellant’s submissions that the Adjudicating Authority had not considered the submissions raised by the assessee and confirmed the demand prejudicially. The appeal was allowed in part and remanded to reconsider the demand of service tax after due consideration of the details furnished by the Appellant.

Proceedings must be initiated on ISD in allegation of wrong distributionof Cenvat credit by ISD: CESTAT rules in favour of Berger Paints M/s Berger Paints India Ltd VS Commissioner of Central Excise, Noida-II CITATION: 2025 TAXSCAN (CESTAT) 123

In a ruling in favour of Berger Paints India ltd, the Allahabad bench of the Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) held that proceedings must be initiated on Input Service Distributer ( ISD ) in the allegation of wrong distribution of Cenvat credit by ISD.

It is settled law that in such cases of alleged wrong distribution of Cenvat credit by ISD, the proceeding should have been initiated at the end of ISD, it is not the case that the credit was wrongly availed by ISD. It is only alleged that the credit has been wrongly distributed to the appellant’s unit, if credit could not have been wrongly distributed to the appellant’s unit at Sikandrabad, the same would have been available to the unit of the ISD elsewhere.

Dept Denies CENVAT Credit u/r 4 of CCR: CESTAT Confirms EligibilityCiting Complete Details Available in Bills/Invoices u/r 9(2) Saraf Services Private Limited vs Commissioner of Service Tax CITATION: 2025 TAXSCAN (CESTAT) 128

The Kolkata Bench of Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) confirmed the appellant’s eligibility for CENVAT Credit stating that complete details were available in bills/invoices as mandated under rule 9(2) of the CENVAT credit rules ( CCR ), 2004.

The tribunal verified the bills/ invoices and held that they contained details in terms of Rule 9(2) of CCR, 2004. Therefore, the tribunal held that there was no contravention of Rule 4(7) of CCR, 2004. The tribunal held that the appellant has rightly availed the CENVAT Credit. The appeal of the appellant was allowed.

Motor Vehicle Registration by Dealer not ‘Business Auxiliary Service’:CESTAT revokes Service Tax Levy AVG Motors Ltd. vs Commissioner of Central Excise CITATION: 2025 TAXSCAN (CESTAT) 122

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Bangalore, while hearing a Service Tax Appeal held that motor vehicle registration conducted by the automobile dealer is not a ‘Business Auxiliary Service’, vitiating any service tax levy on the same.

In light of such observations, the Customs, Excise & Service Tax Appellate Tribunal, Bangalore proceeded to allow the prayer in the present two-fold Appeal, holding that no service tax is payable for registration of the vehicle as held by the previous Adjudicating Authority.

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Burden of Proof Lies on Customs Dept to prove Allegation of Country ofOrigin for ADD: CESTAT drops ADD Demand on Unmarked Pallets C.C.-Ahmedabad VS Vinayak Steel Impex CITATION: 2025 TAXSCAN (CESTAT) 126

The Ahmedabad Bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) ruled that the burden of proof lies on the Customs Department to establish allegations of the country of origin for imposing anti-dumping duty ( ADD ). The tribunal upheld the rejection of ADD demands on unmarked pallets of stainless-steel sheets.

The tribunal also clarified that the principle of “the one who asserts must prove” applied in such cases and the department could not sustain ADD on the unmarked pallets without concrete evidence. The tribunal upheld the Commissioner’s order and the department’s appeal was dismissed as devoid of merit.

Lack of Evidence and Section 11A(4) Misuse: CESTAT quashes ₹2.81 Cr Rule6(3) Demand over Alleged Common Input Service Usage M/s Shree Radhey Radhey Ispat (P) Ltd. vs Commissioner of Central Excise & CGST CITATION: 2025 TAXSCAN (CESTAT) 132

The Allahabad bench of Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) struck down a demand of ₹2.81 Crore against the appellant ruling that the show cause notice ( SCN ) and the order produced by the commissioner of Central Excise and CGST as it was made without evidence and legal merit.

The two-member bench consisting of P.K Choudhary (Judicial Member) and Sanjiv Srivastava (Technical Member) asserted that the absence of evidence to support allegations of suppression or intent to evade tax shows that there is a lack of legal merit in the case. The tribunal, therefore, set aside the commissioner’s order and reversed the penalties and interest.

No Additional Customs Duty on High Speed Diesel Importers under DEECScheme: CESTAT Flexi Tuff International Limited vs Commissioner of Customs, Kandla CITATION: 2025 TAXSCAN (CESTAT) 130

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Ahmedabad Bench recently granted relief to a High Speed Diesel Importer, affirming that no additional customs duty may be levied if they are functioning under the Duty Entitlement Exemption Certificate (DEEC) scheme.

The Tribunal set aside the impugned order passed by the Commissioner of Customs – Kandla, and ruled in favor of Flexi Tuff, reaffirming that exemptions granted under Notification No. 43/2002-Cus shall include additional customs duties levied by Section 116 of the Finance Act, 1999.

Penalty u/s 114AA imposed alleging Aircraft Imported for Directors’private use: CESTAT deletes Penalty finding No False Declaration Commissioner of Customs VS Shri Sarang Wadhawan CITATION: 2025 TAXSCAN (CESTAT) 131

In a recent judgement, the Principal Bench of Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) in New Delhi deleted the penalty imposed on the assessee under Section 114AA of the Customs Act 1962.

The tax department, aggrieved by the order of the Commissioner of Customs (Preventive), proceeded with an appeal to the CESTAT, where the tribunal observed that as the assessee had not filed any false undertaking and that the Commissioner of Customs (Preventive) was correct to refrain from imposing penalty under section 114AA of the Customs Act.

Failure to File Transshipment Bill Deemed a Technical Lapse: CESTAToverturns Duty Demand and Penalties as unjustified Anshu Sahay vs Commissioner of Customs CITATION: 2025 TAXSCAN (CESTAT) 133

The Mumbai Bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) ruled that failure to file a transshipment bill was deemed a technical lapse and does not justify imposing duty demands or penalties.

The tribunal further observed that the goods were used for salvaging a vessel in distress, and their classification as “stores” was consistent with the legislative intent of the Customs Act. The tribunal held that imposing duty demands and penalties in this matter lacked merit and legal basis. The tribunal set aside the orders imposing duties and penalties. The appeal was allowed.

Services like Construction of Road, Bridge rendered to Government exempted from Tax: CESTAT quashes Demand Order

M/s. Koleshwari InfraconsPrivate Limited vs Commissioner (Audit), Central G.S.T. & C.X CITATION: 2025 TAXSCAN (CESTAT) 127

The Kolkata Bench of Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) quashed the demand order confirming that services like construction of roads, and bridges rendered to the Government can be exempted from Tax.

The tribunal also observed that the commissioner cannot reject a report submitted by the department without any valid reason. Therefore, the tribunal quashed the demand order.

The tribunal also remanded back to the commissioner for examination of the claim made by the appellant and directed to give proper opportunity to the appellant. Thus the appeal was allowed.

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Dept denies Exemption for Wrongful CENVAT Credit use on Exempted Goods: CESTAT grants Relief as Excess Credit was reversed before SCN

M/s. UMC Engineering Pvt. Ltd vsCommissioner of Central Excise CITATION: 2025 TAXSCAN (CESTAT) 134

The Kolkata Bench of Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) granted exemption from tax as the excess CENVAT credit was reversed before the show cause notice was issued to the appellant.

The tribunal held that the CENVAT credit has been reversed, so conditions for availing exemption are fulfilled. Therefore the tribunal granted the benefit of exemption to the appellant.

No Violation of Export Procedures: CESTAT sets aside Penalty Imposed on Shipping Agent u/s 114 of the Customs Act

M/s. Samudera Shipping Line (India) Pvt. Ltd. vs Commissioner ofCustoms (Port)

CITATION: 2025 TAXSCAN (CESTAT) 135

In a recent ruling, the Kolkata bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) set aside the penalty that was imposed on the appellant, M/s. Samudera Shipping Line (India) Pvt. Ltd, a shipping agent, under Section 114 of the Customs Act, 1962, as there was no violation of export procedures.

The bench, comprising R. Muralidhar ( Judicial Member ) and K. Anpazhakan ( Technical Member ) set aside the impugned order and allowed the appeal filed by the assessee.

Tyres Without BIS Markings Liable for Confiscation u/s 111 of Customs Act: CESTAT

M/s. Sai Enterprises vs Commissioner of Customs

CITATION: 2025 TAXSCAN (CESTAT) 136

The New Delhi bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ), upheld the confiscation of tyres without Bureau of Indian Standards (BIS) markings under Section 111 of the Customs Act, 1962.

The tribunal held that the goods (tyres) imported by the appellant without any BIS markings being in violation of the statutory provisions are not permissible to be imported, and hence they are liable for confiscation under Section 111 of the Customs Act.

CESTAT upholds Duty Valuation under Rule 10A, Rejects Vehicle Manufacturer’s appeal on Refund Claim

M/s SML ISUZU Ltd vs TheCommissioner of Central Excise

CITATION: 2025 TAXSCAN (CESTAT) 137

In a recent ruling, the Chandigarh bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) upheld the duty valuation made under Rule 10A and rejected the vehicle manufacturer’s appeal on refund claim.

The CESTAT held that the valuation of the goods in the impugned case is to be made in terms of Rule 10A of CEVR 2000 and upheld the impugned order.

Undervaluation of LG TV Panels in Import BoE: CESTAT Remands matter for verifying Customs Import Data

M/s. Param Electronics vsCommissioner of Customs (Import)

CITATION: 2025 TAXSCAN (CESTAT) 138

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), New Delhi opted to remand a matter regarding undervaluation of Television Panels in the import Bill of Entry (BoE), calling for reverification of the matter in light of available contemporaneous import data.

Further noting that the Appellant had imported both ‘LG Brand’ panels as well as unbranded panels, the CESTAT Bench remanded the matter to the original authority to consider the contemporaneous import data adduced by the Appellant and to authenticate the relevance of the records and decide the matter in accordance with law.

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Capital Housing Projects Pvt Ltdvs Principal Commissioner of Central Tax Guntur - GST CITATION: 2025 TAXSCAN (CESTAT) 139

In an important ruling, the Hyderabad bench of the Customs, Excise And Service Tax Appellate Tribunal ( CESTAT ) held that service tax exemption is unavailable to subcontractors for site formation activity for dam construction on the post-negative list regime. The bench found that appellants are neither eligible for exemption under S.No.12(d) nor under S.No.29(h) of the Notification 25/2012-ST dt.20.06.2012.

The bench held that appellants are neither eligible for exemption under S.No.12(d) nor under S.No.29(h) of the Notification 25/2012-ST dt.20.06.2012. In so far as the issue relating to limitation is concerned, we find that the Adjudicating Authority has sustained invocation of extended period. The reasons for sustaining the same has been elaborated in Para 54, 55 & 56 of the impugned order. The main ground considered by the Adjudicating Authority is that the appellants had consciously suppressed the fact of providing taxable services and their value and the same came to the knowledge only after the detailed investigation carried out by the officers of DGGI, VZU, Visakhapatnam.

Relief to Berger Paints: CESTAT quashes ₹6.12 Crore Demand for Alleged Misallocation, Confirms Proportionate Distribution Citing CA Certificate

M/s Berger Paints India Ltd. vsCommissioner of Central Excise

CITATION: 2025 TAXSCAN (CESTAT) 140

The Allahabad Bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) set aside a demand of Rs. 6.12 crore for alleged irregularities in the distribution of CENVAT credit citing that the Input Service Distributor ( ISD ) had proportionately distributed the credit across its units as per statutory requirements and relied on Chartered Accountant’s certificate.

The tribunal observed that no evidence supported the claim of wrongful credit distribution after April 2012. The tribunal explained that extended demand periods require proof of intent to evade taxes which was not in this case. The tribunal set aside demand, and penalties and allowed the appeal.

Leviability of Service tax on renting/leasing immovable properties for commercial purposes : CESTAT directs to pass denovo order

The Commissioner vs Commissionerof GST & Service Tax

CITATION: 2025 TAXSCAN (CESTAT) 141

In a recent ruling, the Chennai bench of the Customs, Excise And Service Tax Appellate Tribunal ( CESTAT) remanded the matter on the challenge on leviability of service tax on renting/leasing immovable properties for commercial purposes and directed to pass denovo order.

The Tribunal set aside the impugned order and remanded the matter back to the file of original authority who shall adhere to the directions given by the High Court in the case of St. Thomas Mount Cum Pallavaram Cantonment Board and then pass a de novo order.

Mere use of lubricants, consumables in relation to Dam Construction work cannot be considered as WCS: CESTAT

Capital Housing Projects Pvt Ltdvs Principal Commissioner of Central Tax Guntur - GST CITATION: 2025 TAXSCAN (CESTAT) 142

In an important ruling, the Hyderabad bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) found that the appellants have only used lubricants, consumables, spares in relation to heavy machineries and explosives for blasting and held that mere use of lubricants and consumables in dam construction work cannot be considered as Work Contract Service (WCS).

The bench held that the activities being performed by the appellant cannot be considered as WCS as there is no evidence to suggest that appellants were discharging VAT on this contract by treating it as deemed sales. Thus, even their alternative claim for exemption under S.No.29(h) of the Notification 25/2012 would also not be admissible because the nature of the work itself being provided by them to their Contractor is not in the nature of WCS and therefore, it would not be covered within the ambit of the said notification.

Reimbursements from Manufacturers for Warranty Services not Taxable before May 2008 Definition Change: CESTAT

M/s. Marikar Motors Ltd vsOffice of the Commissioner of Central Excise, Customs and Service Tax

CITATION: 2025 TAXSCAN (CESTAT) 143

The Bangalore Bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) ruled that warranty reimbursements received from vehicle manufacturers for free services rendered to car owners were not taxable under service tax provisions before the definition amendment in May 2008.

Referencing the Supreme Court’s ruling in Union of India v. Intercontinental Consultants & Technocrats Pvt. Ltd, the tribunal ruled that the service tax demand on warranty reimbursements was unsustainable for the period before the 2008 amendment and directed to drop the demand. The appeal was allowed.

Non Payment of Service Tax for Mining Service: CESTAT Upholds Invocation of Extended Period

SLP Contractors vs Commissionerof Central Tax Guntur - GST

CITATION: 2025 TAXSCAN (CESTAT) 144

The Hyderabad bench of the Customs, Excise And Service Tax Appellate Tribunal ( CESTAT ) has held that they are providing ‘Mining Services’ and not ‘Business Support Services’ and there is sufficient ground for invoking the extended period for raising the demand. It was viewed that the agreement is not that of partnership and is in the nature of service agreement, where the appellants are service provider and are liable to pay Service Tax.

It was observed by the Tribunal that the agreement is not that of partnership and is in the nature of service agreement, where the appellants are service provider and are therefore, liable to pay Service Tax. The Tribunal held that they are providing ‘Mining Services’ and not ‘Business Support Services’ and there is sufficient ground for invoking the extended period for raising the demand.

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Denial of Refund Claim on Service Tax Rendered for SEZ: CESTAT Remands Matter for Adjudication

M/s. Powergear Ltd. vsCommissioner of GST & Central Excise

CITATION: 2025 TAXSCAN (CESTAT) 145

In a recent case, the Chennai bench of the Customs, Excise & Service Tax Appellate Tribunal( CESTAT ) remanded matter on denial of refund claim on service tax rendered for Special Exonomic Zone ( SEZ).The bench held that “ the issue regarding the denial of refund on payment of service tax beyond the relevant quarter is not there as decided in the impugned order and would hence be applicable to the earlier periods also and the matter hence stands remanded on the same terms in all such cases. “

Notification No. 12/2013-ST, allows the Assistant Commissioner of Central Excise or the Deputy Commissioner of Central Excise to extend the time limit however no decision was rendered to their request for extension. When a discretionary power is conferred on an Authority, the power must be exercised in a reasonable, transparent and rational manner free from whims, vagaries and arbitrariness. It is a part of the Authority’s public duty to do so.

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