Académique Documents
Professionnel Documents
Culture Documents
under the head capital gains and income from other sources. - Revenue's appeal dismissed :
DELHI ITAT
DCIT Vs Garware Polyester Ltd
Whether once the profit and loss account is prepared under Part-I & Part-II of Schedule-VI of
the Companies Act; duly certified by the Auditors; placed before the shareholders and
adopted/approved by the AGM, then the Revenue can not make any adjustments to the book
profit except to the extent provided in Explanation 1 - YES : TRIBUNAL - Revenue's appeal
dismissed : MUMBAI ITAT
Mahindra And Mahindra Financial Services Ltd Vs Addl. CIT
Whether depreciation on leased assets be allowed when in past in assessee's own case it has
been allowed and no material change since then has taken place - YES : ITAT
Whether issue of disallowance u/s 14A in respect of Interest expenditure and Administrative
Expenses on exempted income can be reconsidered and restored back to the file of AO, in light
of ratio laid down by the Bombay High Court in the cases of Reliance Utilities and Godrej
Agrovet - YES : ITAT
Whether issue of allowance of commission & brokerage be restored back to AO in view of the
decision taken in past in assessee's own case, to seek confirmations from the parties to whom
commission & brokerage has been paid in excess of Rs. 3,00,000 - YES : ITAT - Case
Remanded : MUMBAI ITAT
DDIT Vs Chennai Custom House
Whether after 01.04.2009, as per the second limb of section 2(15), any activity of rendering any
services in relation to any trade, commerce and business for a cess or any other consideration,
irrespective of the nature of use or application, or retention, of the income from such activity
cannot come under the purview of charity? Whether the assessee having 12A registration and
claiming as a charitable organization is eligible to be claimed again under principles of
mutuality? - Revenue's Appeal Allowed : CHENNAI ITAT
ACIT Vs Shri G Veera Sekhar Reddy
Whether the matter be restored to the file of the AO for deciding the same afresh after verifying
the confirmation letter which is produced as evidence before appellate authority but has not
been produced before AO - YES : ITAT
Whether passing of order based on additional evidence without giving an opportunity to AO to
examine the same is correct - NO : ITAT - Case Remanded : HYDERABAD ITAT
CIT Vs Suman Dhamija
Income tax - CBDT Instruction dated 9/2/2011 - monetary limit.
Assessee's appeal were disposed of by the High Court on the basis of the instructions issued by
the Central Board of Direct Taxes dated 9.2.2011. - Case remanded : SUPREME COURT OF
INDIA
Whether the interest expenditure will have to be excluded from the expenses to be allocated
under rule 8D(2)(ii) where the interest expenditure is no way relatable to exempt income and the
entire borrowing by the assessee was passed on the group concern and entire interest on this
borrowing has been received from that group concern and it was completely a back to back
transaction. - Revenue's appeal dismissed : AHMEDABAD ITAT
Whether assessee would be entitled to exemption u/s 11 where the assessee's activities were
not in excess of its objects and the trustees have carried out the activities of the trust bonafide
and in a manner, which according to them best subserved the charitable objects and the intent
of the Settlor - Whether assessee would be entitled to exemption u/s 11 where in the past
period, the Assessee has been consistently granted exemption under Section 11 of the Act and
also under Section 10(22)/10(22A) or Section 10(23C) of the Act - Whether depreciation on
assets used for providing Allopathic systems of medicine would be allowable if the activities of
the Assessee are within the scope of its objects. - Assessees appeal partly allowed : DELHI
HIGH COURT
Ramesh Veerappa Shirol (Huf) Vs ITO
Whether one more opportunity to produce all the evidences and give explanation, be granted to
assessee, when it fail to do so earlier because books of accounts and the connected documents
are seized by the Revenue - YES: ITAT - Case Remanded : PANAJI ITAT
A P Processors Vs ACIT
Whether Books of account can be rejected without assigning specific reasons for the same NO: ITAT
Whether estimation of receipt can be sustained in the absence of any allegation regarding
suppression of receipts or per se error in the profit rate declared by the assessee - NO: ITAT
Whether the order of AO for rejection of assessee's claim for shrinkage, would amounts to
arbitrariness, in the absence of any evidence to the contrary - YES: ITAT
Whether disallowance made without bringing any kind of comparables on record to substantiate
the disallowance, is sustainable - NO: ITAT
Whether addition was justified where AO had failed to mention the details of specific payments
which in his opinion was hit by the provisions of section 40A(3) - NO: ITAT
Whether in the absence of any proof being adduced or basis to prove that the fire incident was
fabricated to claim insurance, mere assumption by revenue that the assessee's claim was not
genuine, is justified - NO: ITAT
Whether disallowance of rent paid for the machineries for the period from April to June 2006 is
justified, where liability to deduct TDS on payment of rent on machinery is introduced by the
Taxation Law Amendment Act, 2006 w.e.f. 13.7.2006 only and not before that - NO: ITAT
Whether where the processing activity done by assessee was "manufacturing", then for claiming
deduction u/s 32(1)(iia) it was immaterial that the assessee was doing the job of processing for
outside customers too - YES: ITAT - Case remanded : DELHI ITAT
Smt Ruta S Jindal Vs ACIT
Whether when AO accepts that joint family is living together in the same house, the jewellery
found in one room cannot be treated as only belonging to the lady living Whether when at the
time of search no statement was recorded from the assessee and hence there was no occasion
for her to state that part of the jewellery belong to her mother in law/ father in law or to specify
the items of such jewellery, no adverse inference should be taken on the basis of the same. Assessees appeal is allowed : DELHI ITAT
ITO Vs Kalanjiam Development Financial Services
Whether when the assessee has raised loans to advance to the customers by paying interest
and it is not having own corpus in a formal capital so as to advance the loan, the assessee is
providing loans by association with various commercial banks by raising loans from them, such
kind of micro finance activity cannot be termed as charitable activity rather than it is a business
activity. - Revenues appeal allowed : CHENNAI ITAT
Tril Infopark Ltd Vs ITO
Whether the lease for 99 years is almost like a sale and tax cannot be deducted u/s 194-I Whether the TDS amount can be recovered from the assessee if the recipient has paid the
taxes.
The assessee is a joint venture with the object of development of Special Economic Zone for
Information Technology / Information Technology Enabled Services. The AO by the impugned
order found that the assessee had not deducted tax u/s 194-I on the payment made to TN
Industrial Development Corporation Ltd. The AO held the assessee as assessee in default u/s
201(1), and levied penal interest u/s 201(1A). The AO passed the order on 3.10.2013 treating
the assessee as assessee in default for the A.Y 2009-10. The CIT(A) affirmed the AO order. Case remanded : CHENNAI ITAT
Shree Yogi Steels Pvt. Ltd Vs DCIT
Whether when AO has applied his mind and taken a possible view after going through returns of
the assessee for earlier years, CIT is not justified in taking action against the assessment order
- Whether the explanation appended to section 251 authorizes the Commissioner, while
disposing of an appeal to consider and decide any matter arising out of the proceeding in which
order appealed against was passed, notwithstanding that such matter was not raised before the
Commissioner by the appellant - Whether when it is assumed that AO has committed an error
by not computing the true capital gain with the application under sec. 50(1) then also ultimately
no prejudice has been caused to the revenue as the impact is revenue neutral.- Assessee's
appeal allowed : AHMEDABAD ITAT
Tetra Soft (India) Pvt. Ltd Vs ACIT
Whether where an assessee has not remitted employees contribution to PF within the due date
as prescribed u/s 36(1)(va), the said amount can be disallowed if the assessee has remitted the
same within the due date of filing of return u/s 139(1) - NO: ITAT
Whether UPS being part and parcel of computer system, the depreciation on the same can be
claimed at 60% as prescribed for computers - YES: ITAT - Assessee's appeals allowed :
HYDERABAD ITAT
DCIT Vs NSL Renewable Power Pvt. Ltd
Whether sale of carbon credits is to be considered as capital receipt and not taxable income YES: ITAT - Revenue's appeal dismissed : HYDERABAD ITAT
SERVICE TAX
Zenith (Bangalore) Rollers Pvt. Ltd Vs CCE
Service Tax - Classification - Re-rubberization of old and worn out spindles for the printing
industry by fresh coat of vulcanized rubber - Activity held classifiable as Business Auxiliary
Services in the light of Zenith Rollers ratio and falls within the ambit of exemption Notification
No.14/2004-ST dt. 10/09/2004 - Impugned orders denying benefit of Notification by classifying
the said activity under Management, Maintenance or Repair (MMR) quashed and appeal
allowed with no costs - Assessee appeal allowed : HYDERABAD CESTAT
Century Star Vs CST
Service Tax - Transportation charges within the port from warehouse to wharf and vice versa
during the years 2006-07 and 2007-08 - Allowed under GTA service - Post 2010, the Finance
Act treated all services rendered within the port area as port service - Prior to 2010, services
rendered within port are classified according to the category and nature of service - For the
period in dispute, appellant was engaged in transportation within the port from warehouse to
wharf and vice-versa - Held justified in believing that services rendered covered under GTA
service - Authorities below failed to show how inter carting work undertaken by the appellant
amounted to rendering of steamer agent service - Since the appellant paid entire amount of tax
along with interest prior to issue of show cause notice, without contesting issue of classification,
held is entitled to the benefit waiver of penalty by invoking provisions of Section 80 - Appeal thus
allowed confirming demand and interest. - Assessee appeal partly allowed : BANGALORE
CESTAT
Windsor Machines Ltd Vs CCE & ST
ST - Canteen/catering services - Once the assessee had produced a CA's certificate from
competent authority and claimed that no cost of food recovered from its employees, then the
same cannot be brushed aside by Revenue on a presumption without taking any alternative
opinion from an expert that such a cost has been recovered from its employees - No
documentary evidence has been brought on record by Revenue that some portion of cost of
food supplied by assessee is recovered from employees - Entire ST credit is admissible to
assessee and order passed by First Appellate Authority is set aside: CESTAT - Appeal allowed :
AHMEDABAD CESTAT
CCE Vs Vodafone Essar South Ltd
ST/CE - S.35C(2A) of CEA, 1944 - If the main provision cannot be treated as mandatory, the
first, second and third proviso also cannot be treated as mandatory but directory - The three
provisos have to advance the cause of justice and not to defeat it - Tribunal is vested with the
power to extend the stay order beyond the specified maximum time limit prescribed - Revenue
appeals dismissed: High Court - Appeals dismissed : ALLAHABAD HIGH COURT
CC, CE & ST Vs Tpsc India Pvt. Ltd
Service Tax - Employees of parent company at Japan deputed to work in India - Demand under
reverse charge under Supply of manpower service - Revenue in appeal against the order of
Tribunal granting unconditional stay - Held: The Tribunal had taken into consideration of the fact
that the issue with regard to similar circumstances was already the subject matter of two
decisions of the Tribunal at Delhi. In that view of the matter, when the issue is squarely covered,
there would be no justification for directing a pre-deposit - No illegality or infirmity in the
impugned order - The appeal is dismissed. - Appeal dismissed : ANDHRA PRADESH HIGH
COURT
Phoenix Logistics Pvt. Ltd Vs CC
Service Tax - Appeal against the order of Tribunal declining to condone the delay in filing the
appeal and dismissing the same on the ground of delay - Held: The fact that order dated
26.03.2012 came to be served on the employee of a sister concern and the same came to the
notice of the appellant belatedly, cannot be ignored. No motive as such can be attributed to the
appellant for not filing appeal in time, especially in view of the fact that the appellant is diligently
agitating the issue involved as against the assessment for the previous years and also for
subsequent years - The Tribunal could have taken a lenient view and, by putting the appellant
on terms, could have condoned the delay - Inasmuch as the Tribunal failed to exercise the
discretion, considering the facts of the case, appeal is allowed on condition of the appellant
depositing a sum of Rs.3,50,000/- within a period of six weeks. Appeal allowed : ANDHRA
PRADESH HIGH COURT
IJM (India) Infrastructure Ltd Vs CC, CE & ST
Service Tax - Service provided to Associate enterprise - Absent debit/credit entries in books of
account, outstanding amount due from associated enterprise as of 10/5/2008 - Held cannot be
treated as amounts paid for the purpose of levy of tax - Amendment to Section 67 of Finance
Act, 1994 not retrospective - Following precedent decision, demand held unsustainable Directed to hear appeal without insisting pre-deposit. - Stay granted : BANGALORE CESTAT
B R Singh And Co Vs CCE & ST
ST - Litigants should not suffer due to the fault of their Advocate - Appeal should have been
decided on merits and not on mere technicalities - Delay of 536 days in filing appeal condoned:
High Court - Petition disposed of : JHARKHAND HIGH COURT
Tajmahal Tobacco Company Pvt. Ltd Vs CCE
Service Tax - Rectification of error - incomplete sentence at para-5 in the Final Order
No.40056/2015 dt.13.1.2015passed by the Bench - brought to notice for rectification.
Held: Due to typographical mistake, the citation of the Supreme Court's judgement is not typed Accordingly, the last sentence of para-5 in Final Order No.40056/2015 dated 13.1.2015 is
corrected to read as under :-
"He relied upon the Hon'ble Supreme Court judgment in the case of Gujarat Ambuja Cements
Ltd. Vs UOI - Letter disposed of : CHENNAI CESTAT
ST - Renting of Immovable property service - Appellant had given its immovable property on
rent and received rent of Rs.51.99 lakhs during the period 01/06/2007 to 30/06/2011 on which
ST of Rs.4.87 lakhs was not paid - SCN issued and proposals confirmed vide order dated
09/07/2012 - Commissioner(A) upheld o-in-o - appeal before CESTAT. Held: Appellant paying
entire service tax along with interest on 26/11/2012 and seeking waiver of penalties imposed
u/ss 76, 77 & 78 of FA, 1994 - under special provisions in the FA, 2012, immunity is granted
from imposition of penalties if appellant pays the tax due as on 06/03/2012 within a period of six
months from date on which Finance Bill, 2012 was enacted - Bill received assent on 28/05/2012
and, therefore, six months period expired on 28/11/2012 - as appellant has paid liability on
26/11/2012, they have made a clear case for waiver of penalties in terms of s.80(2) of the FA,
1994 - penalties imposed u/ss 76, 77 & 78 waived - appeal allowed to the said extent: CESTAT Appeal partly allowed : MUMBAI CESTAT
GKN Sinter Metals Pvt. Ltd Vs CCE
ST - Applicant seeking extension of stay on the ground that their appeal has not come up for
disposal for no fault of theirs. Held: In the case of Venketeshwara Filaments Pvt. Ltd. - it is held
that consequent upon omission of 1st , 2nd and 3rd proviso to section 35C(2A) of the CEA,
1944 by the FA, 2014 it is to be held that there is no provision for making further application for
extension of stay and that the stay order passed by the Tribunal, if it is in force beyond
07.08.2014, it would continue till the disposal of the appeals and there is no need for filing any
further applications for extension of orders granting stay either fully or partially - since the stay in
the present case was in force beyond 07.08.2014, same would continue till the disposal of the
appeal - Application disposed of: CESTAT - Application disposed of : MUMBAI CESTAT
Y N Warehousing Company Vs CC & CE
ST - Valuation - s.67 of FA, 1994 - Appellant registered as Clearing and Forwarding Agent and
collecting fixed computer stationery charges and godown rent - Revenue alleging that the said
charges are to be included in the gross value of services rendered and ST to be discharged
accordingly - Period involved is October 2002 to March 2006 - Asst. Commr. dropping the
proceedings but Commissioner as reviewing authority confirmed the demand and imposed
penalties and interest - appeal to CESTAT. Held: Commissioner in review order relies upon Rule
5 of ST (Determination of Value) Rules, 2006 which were not in statute during the material
period - provisions which were not in statute cannot be applied for demand of tax - on this point,
order is non est. - so also, provisions of rule 5(1) of Rules, 2006 have been struck down by
Delhi High Court in case of Intercontinental Consultants & Technocrats Pvt. Ltd. - order is
unsustainable and hence set aside - appeal allowed with consequential relief: CESTAT - Appeal
allowed : MUMBAI CESTAT
CENTRAL EXCISE
CE - CENVAT credit suo motu reversed by assessee - where there has been no determination
of the demand u/s 11A(2) of CEA, 1944, penalty u/s 11AC cannot be imposed - however,
interest is payable u/s 11AB irrespective of the fact that the inadmissible credit was not utilized Appeal partly allowed: CESTAT - Appeal partly allowed : MUMBAI CESTAT
CX - Interest - Whether appellant is required to pay interest in a case where duty along with part
interest was paid voluntarily - appellant submitted that interest on delayed payment of duty
cannot be demanded unless duty is determined under s.11A(2) of CEA, 1944. Held: It is an
admitted fact that there is substantial delay in payment of duty even though appellant has paid
interest voluntarily - even though the duty was not determined u/s 11A(2) of CEA, 1944 but
when there is admitted delay in payment of duty, interest is chargeable even prior to 11.05.2001
- in view of apex court decision in International Auto Ltd. interest is levied for loss of Revenue on
any count - no infirmity in the order, hence sustained - appeal dismissed: CESTAT - Appeal
dismissed : MUMBAI CESTAT
Ambassador Coolers Pvt. Ltd Vs CCE
CX - Assessee has placed purchase order to supply all goods to M/s. Nowrangroy Rameshwar
with directions that goods are required to be delivered at job worker's place - Invoices were
raised in name of assessee and goods were delivered to job worker, which were received by
assessee after processing - Rates quoted are of job work charges only, although the job worker
has paid VAT thereon - It cannot be concluded that goods have been sold by job worker to
assessee - When assessee has filed reply to SCN, facts were required to be verified which
Revenue has failed to do so - Under notfn. 214/86, job worker is required to intimate the
department that they are undertaking activity of job worker and not required to pay duty but that
fact has also been not verified by department - Assessee is entitled to take Cenvat credit Appeal allowed: CESTAT - Appeal allowed : DELHI CESTAT
Pepsico India Holdings (P) Ltd Vs CCE
CX - Assessee are manufacturers of Aerated Water, one of the inputs is glass bottles in respect
of which input duty CENVAT Credit has been taken - Some glass bottles, during use get broken
and same are cleared as glass scrap - During period of dispute there was no provision in CCR,
2001/2002 providing that when CENVAT Credit availed inputs are cleared as waste, some
amount in respect of same is required to be paid - Impugned order set aside and appeal
allowed: CESTAT - Appeal allowed : DELHI CESTAT
Hetero Labs Ltd Vs CCE
Central Excise - Bulk drug manufacture - Procurement of duty free imported and indigenous raw
material - Cenvat credit utilization -Whether or not credit availed on duty paid inputs can be
used for discharge of duty at the time clearance of the duty free imported inputs - Held in
matters of CENVAT credit, there is no one-to-one correlation and where appellants have used
such credit for payment of duty for clearance of imported raw materials, they would not be in a
position to use the same at the time of clearance of the final product-Treating reversal as proper,
pre-deposit dispensed with - Matter remanded to the Commissioner (A) for a decision on merits
- Remanded : BANGALORE CESTAT
Shah Paper Mills Ltd Vs CCE & ST
CX - Assessee is manufacturer of kraft paper from waste paper - Whether main assessee was
eligible to take credit on basis of cenvatable documents showing payment of duty - Assessee
taking cenvat credit is not required to go beyond cenvatable document to know as to how it has
arisen - What input recipient is required to verify is that supplier of raw material is genuine and
proper duty is paid - Both the conditions are fulfilled - Duty paid on waste kraft paper was
accepted by officer Incharge of supplier unit M/s SPPML - On merit assessee was eligible to
take CENVAT credit - No evidence brought on record that main assessee and its Director were
aware that inputs received was as a result of an activity not amounting to manufacture Demand issued is clearly time barred as extended period is not imposable and no penalties can
be imposed upon assessee: CESTAT - Appeals allowed : AHMEDABAD CESTAT
The decision of the Tribunal holding the product in question to be a medicament and, therefore,
covered by Chapter Heading 3003.10 is perfectly justified and does not call for any interference.
- Revenue Appeal Dismissed: SUPREME COURT OF INDIA
Purolator India Ltd Vs CCE
Central Excise - Valuation - Cash Discount has to be taken into account in arriving at "price"
even under Section 4 as amended in 2000: It can be seen that Section 4 as amended
introduces the concept of "transaction value" so that on each removal of excisable goods, the
"transaction value" of such goods becomes determinable. Whereas previously, the value of
such excisable goods was the price at which such goods were ordinarily sold in the course of
wholesale trade, post amendment each transaction is looked at by itself. However, "transaction
value" as defined in sub-clause (3)(d) of Section 4 has to be read along with the expression "for
delivery at the time and place of removal". It is clear, therefore, that what is paramount is that
the value of the excisable goods even on the basis of "transaction value" has only to be at the
time of removal, that is, the time of clearance of the goods from the appellant's factory or depot
as the case may be. The expression "actually paid or payable for the goods, when sold" only
means that whatever is agreed to as the price for the goods forms the basis of value, whether
such price has been paid, has been paid in part, or has not been paid at all. The basis of
"transaction value" is therefore the agreed contractual price. Further, the expression "when sold"
is not meant to indicate the time at which such goods are sold, but is meant to indicate that
goods are the subject matter of an agreement of sale.
When sold does not mean the time: The expression "actually paid or payable for the goods,
when sold" only means that whatever is agreed to as the price for the goods forms the basis of
value, whether such price has been paid, has been paid in part, or has not been paid at all. The
basis of "transaction value" is therefore the agreed contractual price. Further, the expression
"when sold" is not meant to indicate the time at which such goods are sold, but is meant to
indicate that goods are the subject matter of an agreement of sale - Appeal partly allowed in
favour of assessee : SUPREME COURT OF INDIA
Value Industries Ltd Vs CCE
CX- Whether the activity of repair carried out on returned defective compressors falls under
"repair" as provided u/r 173H of CER, 1944 or manufacture' u/s 2(f) of the CEA, 1944 - Activity
is repair as no new commodity emerges - CE duty demands set aside and appeal allowed:
CESTAT - Appeal allowed : MUMBAI CESTAT
Varroc Engineering Pvt. Ltd Vs CCE
CX - Appellant availing CENVAT credit of tax in respect of services provided by Prakash Air
Freight Pvt. Ltd. department of the view that appellant had wrongly paid ST on service which
were exempted from payment of ST vide notification 29/2005-ST in relation to transport of
goods by aircraft operator and subsequently availed credit appellant submitting that bills
issued by service providers shows the same as 'courier service' - credit denied and in de novo
proceedings Assistant Commissioner concluding that 'courier service' provided by service
provider was not covered under definition of 'input service' Commissioner(A) holding that
services are post clearance export activities not connected with manufacture of goods, hence
credit not admissible. Held: As delivery charges are included in selling price, in view of
Karnataka HC decision in ABB Ltd., the expression 'activities relating to business' admittedly
covers transportation up to the customers place and, therefore, credit cannot be denied as it is
an integral part of business of manufacturer to transport and deliver the goods manufactured,
appellant entitled to take credit Appeal allowed with consequential benefits: CESTAT - Appeal
allowed : MUMBAI CESTAT
Timex Watches Ltd Vs CCE
CX - Whether inputs on which assessee have taken modvat credit have been put to use for
manufacture of watches - As per Report of Defective Work, assessee initially availed modvat
credit on inputs/parts of watches, at time of receipt of same before putting to use, assessee has
conducted certain tests to find out whether inputs to be usable or not - Inputs which did not find
fit to be used, assessee has reversed credit thereon, rest of inputs were issued by assessee for
processing or assembling of watches - Defective goods were found only after inputs were
issued for processing or assembling of watches, assessee is entitled to credit as per Rule 57D
of erstwhile Central Excise Rules, 1944: CESTAT
CX - Shortage of inputs - Assessee have explained general ledger of stock adjustment account
reflected inputs have been short accounted in some cases and in some other cases inputs are
in excess, therefore, there is no actual shortage of inputs - Shortages and excesses are due to
the fact that stock accounting used to be done on weighment basis since minute inputs ran into
millions and physical counting is not possible - There is no shortage of inputs as explained by
assessee - All shortages/rejections have been supported by chartered accountant certifying the
same which has not been controverted by Revenue with cogent evidence - Assessee are not
required to reverse modvat credit taken by them - Penalty is not imposable on assessee:
CESTAT - Appeal allowed : DELHI CESTAT
VST Industries Ltd Vs CCE, C & ST
Central Excise - Capital goods - Scope - Inputs (insect controlling traps) used for
managing/controlling the tobacco beetle infestation - Held, have to be considered as eligible
cenvattable inputs having been used in relation to manufacture of final products - Credit availed
clearly reflected in the records - Question of malafide intention does not arise - Stereotype
reasoning given in all the cases of adjudication orders by Revenue to invoke extended period of
limitation, deprecated- Impugned order of duty demand, penalty and confiscation of goods, set
aside - Assessee appeal allowed : BANGALORE CESTAT
Bharat Heavy Electricals Ltd Vs CC & CE
CX - Provisional Assessment - Rule 7 of CER, 2002 - Interest is leviable even where differential
duty was paid prior to the finalization of the assessment - Bombay HC decisions in CEAT &
Ispat Industries disagreed: Allahabad HC - Appeal dismissed : ALLAHABAD HIGH COURT
Rajuri Steels Pvt. Ltd Vs CCE & C
CX - Appellant was working under the compounded levy scheme u/s 3A of CEA, 1944 - since
appellant did not discharge CE duty liability as fixed u/r 96ZP(3) of CER, therefore, SCN issued
and duty confirmed which appellant paid without contesting the order-in-original - subsequently,
another SCN was issued demanding interest and equal amount of penalty u/r 96ZP(3) and
which was confirmed - appellant before CESTAT. Held: No discretion is provided to any authority
to either reduce or waive penalty and interest in any circumstances - when there is admitted
delay in payment of duty under compounded levy scheme, interest and penalty provided under
the proviso to the rule shall unavoidably be imposed - Penalty and interest rightly imposed by
adjudicating authority and upheld by Commissioner(A) which do not require any interference Order upheld and appeal dismissed: CESTAT - Appeal dismissed : MUMBAI CESTAT
Mettur Thermal Power Station Vs CBEC
Central Excise - Demand of duty on Fly Ash and Fly Ash bricks cleared post 01.03.2011 Petition challenging the Show Cause Notice on various grounds.
Held: Process does not amount to manufacture - To be subjected to levy of excise duty
"excisable goods" must be produced or manufactured in India. For being produced and
manufactured in India, the raw material should have gone through the process of transformation
into a new product by skillful manipulation. Excise duty is an incidence of manufacture and,
therefore, it is essential that the product sought to be subjected to excise duty should have gone
through the process of manufacture.
The Apex Court Union of India versus Ahmedabad Electricity Company Limited" - has
categorically held the "cinder" which is unburnt part of coal, is not exigible to excise duty since
no manufacturing process was involved to produce the same and as such it did not satisfy the
test of being manufactured in India as envisaged in the provisions of the Act and that the onus
to establish that cinder has gone through the process of manufacture in India was not
discharged by the department. -The difference between 'cinder' and 'fly ash' is that when coal is
not burnt fully and leaves pieces behind, is called 'cinder' whereas, when it is fully burnt and
reduced to ash, is called 'fly ash'. Therefore, The ratio decided in the above said decision would
squarely apply in the case of 'fly ash' also since the product 'fly ash' also cannot be said to have
gone through any manufacturing process.
Notification No 89/95 CE - Waste arising out of exempted goods is exempted under Notification
No 89/95 CE - 'Electricity' has been specified in the First Schedule of the Central Excise Tariff
under heading 27160000, but it is not subjected to a duty of excise since under the 'rate column'
the duty of excise is indicated as 'nil'. Merely, rate of duty is mentioned 'nil', it cannot be
construed that it is non-excisable good. They were excisable goods. Nil rate of duty is also a
rate of duty. Therefore, electricity is excisable good and can be construed as exempted goods The exemption Notification No.89/95-CE would squarely applicable to the product 'fly ash',
which is a waste arise during the course of manufacture of electricity, which is an excisable
good chargeable to "nil" rate of duty.
Fly Ash Bricks dutiable - Fly ash does not itself get shaped as bricks unless some
manufacturing activity is involved. Since the raw material fly ash undergoes a change since an
operation performed on it, resulting into fly ash brick, such operation would certainly amount to
processing of the commodity and such commodity is recognized as a new and distinct article,
i.e. 'fly ash brick'. Therefore, the good 'fly ash brick', having satisfied the test of being
manufactured in India and also marketability, is leviable to excise duty.
Writ Petition partly allowed by setting the demand in respect of Fly Ash - Petition partly allowed :
MADRAS HIGH COURT
Vishnu & Co Pvt. Ltd Vs Superintendent Central Excise
CX - S.9/9AA of CEA, 1944 Demand of duty set aside by CESTAT - Quashing of FIR sought since the petitioners have an alternate and efficacious remedy to seek discharge from trial court,
High Court not inclined to exercise its inherent jurisdiction under Section 482 of CrPC: HC Petitions disposed of : DELHI HIGH COURT
Aircel Ltd Vs CCE, C & ST
Central Excise - Pre-deposit - CENVAT Credit of duty paid on Tower parts and Shelters and
input services used for erection and installation of towers and shelters - Appeal against the
order of Tribunal directing the appellant to pre-deposit Rs 12 crores.
Held: Following the order of the High Court in appellant's own case, pre-deposit is modified to
Rs 10 crores, to be paid in three installments. - Appeal disposed of : MADRAS HIGH COURT
Central Excise - Valuation - Additional Consideration - transfer of the right to procure duty free
imported raw material is additional consideration, to be included in value: additional monetary
consideration, in addition to the price being paid for the goods, i.e. transfer of advance import
licence in favour of the seller by the buyer enabling the seller of the goods to effect duty free
import of the raw materials and bringing down the cost of production/procurement, is a
consideration, the monetary value of which has to be considered under the provisions of the
Rules, i.e. Rule 6 thereof. It needs to be emphasized at the cost of repetition that the resultant
effect of invalidating the advance licence by the buyer was issuance of licence for intermediate
supply in favour of the assessee and the said licence ensured certain benefits in favour of the
assessee. In the present case, on these facts, we have to simply see as to whether the
definition of 'transaction value', as contained in Section 4 of the Act read with Rule 6 of the
Rules, would encompass this benefit as amounting to additional consideration. It would come
within the ambit of additional consideration indirectly flowing from the buyers to the assessee.
Supreme Court Judgement in IFGL case affirmed, Mazagon Dock distinguished: In
Commissioner of Central Excise, Bhubaneswar - II v. IFGL Refractories Ltd., the Supreme Court
had held that in pursuance of the contract of sale, there is directly a flow of additional
consideration from the buyer to the seller. The value thereof has to be added to the price.
Though the Counsel sought a re-consideration of this judgement, the Supreme Court did not
agree. The Supreme Court distinguished the judgement in the case of Commissioner of Central
Excise, Bangalore v. Mazagon Dock Ltd., wherein it was held that subsidy given by the
Government need not be included in the assessable value. This judgement has no bearing on
the present matter. - Revenue Appeal allowed : SUPREME COURT OF INDIA
Bhuwalka Steel Industries Ltd Vs UoI
Central Excise - Hot Re-rolling Mills Annual Capacity Determination Rules, 1997 (ACP Rules
1997) - Demands adjudicated and agitated in appellate channel, culminating in a writ petition
praying inter alia for declaring Rule 5 of the ACP Rules 1997illegal, ultra virus and
unenforceable - Order passed by single bench upheld by Divisional bench and agitated before
the Apex Court, which disposed of a bunch of cases by remand to the respective High Courts The restoration was based on the observation in the Daoba Steel Mills case, that in all those
appeals, there is no challenge to the validity of Rule 5 of the 1997 Rules inserted vide
Notification dated 30-8-1997 and, therefore, the Court was required to interpret it and examine
the width of its application - The restored WP is disposed of herein.
Held: Order passed by the Court on 7.12.2005 indicates that the issue of constitutional validity
of Rule 5 was considered -judgment of the Single Judge came to be affirmed on re-appreciation
of contentions by Division Bench viewing that Rule 5 cannot be stated to be violative of Article
14 or ultra vires Section 3A; and that the differentia or classification, as alleged, have a rational
nexus with the object to be achieved by the law - it has been held by the Division Bench that
Rule 5 of the ACP Rules, 1997 is neither violative of Article 14 of the Constitution of India or
ultra vires of the provisions contained in Section 3A of the Central Excise Act, 1944 and thereby
dismissed the appeals - the co-ordinate Bench as well as Division Bench of the Court has dealt
extensively with regard to constitutional validity of Rule 5 of the ACP Rules, 1997 - question of
re examination of the said issue does not arise. - WP dismissed : KARNATAKA HIGH COURT
Shreematha Precision Components Vs CCE
Central Excise - Default in payment of duty - Rule 8(3A) of the Central Excise Rules, 2002 - In
WP 1438/2015 though the duty liability for the quarter ending March 2011 has been paid on
26.5.2011 and interest having been paid on 29.5.2012, it was held by the authorities that in
terms of sub-rule (3A) of Rule 8 of Central Excise Rules, 2002, petitioner has defaulted in
payment - In WP 13104/2015, the respondent authorities alleged that petitioner has failed to pay
the central excise duty on the goods cleared during the said month and same had been paid
belatedly thereby, petitioner has committed default by contravening the provisions of Rule 8(3)
of the Central Excise Rules, 2002 - recovery notices under Sec 11 issued, agitated in the WPs
herein.
Held: Under Rule 8(3A), in the event of assessee committing default in payment of duty beyond
30 days from the due date as prescribed under sub-rule (1), then notwithstanding anything
contained in sub-rule (1) or sub-rule (4) of Rule 3 of CENVAT Credit Rules, 2004, such
assessee would be required to pay excise duty for each consignment at the time of removal,
without utilizing the CENVAT credit till the date the assessee pays the amount including the
interest thereon; otherwise, such clearance would be deemed as one cleared without payment
of duty and the consequence of penalties as prescribed under the Rules would follow - A bare
reading of Rule 14 would indicate that where the assessee has taken or utilized wrongly or has
been erroneously refunded the CENVAT credit, then authorities would be entitled to recover the
same from the manufacturer or the provider of the output service and provisions of Sections 11A
and 11AB of Central Excise Act or Sections 73 and 75 of the Finance Act would apply mutatis
mutandis for effecting such recoveries - Thus, before initiating recovery proceedings, it would be
incumbent upon the authorities to issue notice to the petitioners under Section 11A of the Act for
having either utilized the CENVAT credit wrongly for bringing such action within the scope of
sub-rule (3A) or to construe such transaction as having cleared the goods without payment of
duty or in other words, such belated utilization of CENVAT credit for payment of central excise
duty to be construed as one in contravention of sub-rule (3A) of Rule 8 - The audialterempartem
principle would be squarely applicable in case of such recoveries and particularly, when it is
alleged that CENVAT credit has been utilized beyond the prescribed period - impugned notices
cannot be sustained as it is contrary to Rule 14 of CENVAT Credit Rules, 2004, and in violation
of natural justice - recovery notices and demand notices quashed - respondent permitted to
initiate proceedings under the Act read with Rule 14 of Cenvat Credit Rules, 2004. - WPs
allowed : KARNATAKA HIGH COURT
S L Industries Vs CCE & ST
Central Excise - Relied upon documents - Petitioner firm engaged in manufacture of plastic
articles - offence case booked and notice issued, proposing duty demand with interest and
penalty - notice pending adjudication; WP filed, seeking direction to respondent to furnish copies
of documents relied upon in raising the demand proposals, to enable them defend their position
prior to adjudication.
Held: petitioners have sought for copy of entire order sheet, office notes, copies of summons
issued to various constituents of petitioners and documents referred to in the seizure order and
also information contained in CPU of VIP make computer with CD - documents referred to in the
show cause notices in question, including seizure mahazar has been furnished to petitioners in
three volumes - the documents which are now sought for by petitioners in their respective
representations have not been relied upon in the show cause notices - question of issuing any
writ of mandamus to respondent to furnish copies of documents to petitioners, as sought for in
the respective representations, does not arise - It is not the case of petitioners that documents
which are indicated in the show cause notices have not been furnished to petitioners; or that the
same has been relied upon by the respondent - WPs devoid of merit - Petitions dismissed :
KARNATAKA HIGH COURT
CUSTOMS
Cus - Issue is regarding denial of draw-back and dismissal of appeals by the first appellate
authority - As per first proviso to section 129A(a) of the Customs Act, 1962 appeal lies to
Government of India and not before Tribunal - Appeals disposed of as not maintainable:
CESTAT - Appeals disposed of : MUMBAI CESTAT
CC Vs Dozco (India) Pvt. Ltd
Customs - Refund claim of Special Additional Duty (SAD) - Limitation applicability - SAD refund
claim filed beyond one year relating to the period prior to the date of issue of amending
Notification No. 93/2008 dated 1.8.2008 - Following Delhi High Court ruling in Sony India Pvt.
Ltd, held is not barred by limitation - Revenue appeal has no merit hence was rejected. Revenue appeal rejected : BANGALORE CESTAT
While considering a similar case under the Central Excise Act, the Apex Court in Ranbaxy
Laboratories Ltd., has interpreted under Section 11BB as well as the Explanation of the said
Section in the same manner as has been held by the Tribunal. The provisions of Section 11BB
of the Central Excise Act, 1944 and Section 27A of the Customs Act are parimateria.
No substantial question of law arises in this appeal for determination - Appeal dismissed Appellant directed that besides the payment of interest from 24.03.1999 (which is three months
after the date of application for refund of customs duty filed by the respondent) till the actual
date of the payment, which shall be at such rates notified from time to time, the appellant shall
further be liable to pay additional interest at the rate of 9% per annum (besides the notified
interest) on the amount which is found liable for payment as on 13.04.2011, till its actual
payment - Appeal Dismissed : KARNATAKA HIGH COURT
NDPS -Based on intelligence that appellant Zile Singh was habitual seller ofcharas and was
present near the watercourse, a police party apprehended him in the presence of a civil gazette
officer and detected 500g of charas in his pocket - the material was seized; sample sent to
forensic lab confirmed it to be charas - After completion of required formalities and finding a
prima facie case for the offence punishable under Section 20(b) of NDPS Act, the appellant was
charge-sheeted; statement under Section 313 CrPC recorded; to which he pleaded not guilty
and claimed trial-contentions that (i) the prosecution case suffers from material discrepancies;(ii)
SI Ram Chander being complainant, was not entitled to investigate the case;(iii) no independent
witness was joined during investigation of the case; and(iv) the provisions of Section 50 NDPS
Act were not complied and the offer of search given to the appellant suffered from material
discrepancy to the effect that he was not apprised to get himself searched before a Magistrate;
discarded by trail Court - appellant convicted for the offence punishable under Section 20(b) of
Narcotic Drugs and Psychotropic Substances Act, 1985; sentenced to undergo rigorous
imprisonment for five years; pay a fine of `40,000, and in default thereof, to undergo further
imprisonment for a period of two years - Trial Court ruling is agitated herein. - Appeal allowed :
PUNJAB AND HARYANA HIGH COURT
Customs - Customs Broker Licensing Regulations, 2013 (CBLR 2013) - Appellant acted as
Customs Broker in the import of PVC Flex Banners - DRI investigation revealed that the
importers misdeclared the country of origin to evade anti dumping duty and it was alleged that
the petitioner was involved in the evasion - CHA License suspended under Regulation 19(1) of
CBLR 2013, suspension continued under Regulation 19(2) ibidem with a notice proposing
revocation under Regulation 18 ibidem - impugned order was passed, revoking the licence of
the petitioner and ordering forfeiture of the amount of security deposit made by the petitioner;
agitated herein.
Held: After issuance of the show cause notice, the petitioner had submitted their reply;
participated in the enquiry on completion of which, the petitioner was given opportunity to file
their reply; the petitioner filed the reply, duly considered by the first respondent who passed the
impugned order revoking the license - having replied to the show cause notice and to the report
of the Enquiry Officer and having participated in the enquiry, it is not appropriate for the
petitioner to raise objections regarding the show cause notice that too after the impugned order
was passed and in fact, the show cause notice got merged with the impugned order - The
impugned order in the instant case has been passed by the Commissioner of Customs (Imports)
in exercise of his power under the Customs Brokers Licensing Regulations, 2013 which are
framed under Article 146(2) of the Customs Act, 1962 - Regulation 21 provides that a Customs
Broker who is aggrieved by any order passed by the Commissioner of Customs under the said
regulations may prefer an appeal under Section 129-A of the Customs Act to the Customs,
Central Excise and Service Tax Appellate Tribunal, which is an efficacious alternative remedy
available to an aggrieved broker
The writ Court is averse to interfere with the acts and actions of the statutory authorities unless
those are beyond jurisdiction or in excess of jurisdiction; and unless those ingredients are
present, the Writ Court will be slow to interfere in the matter - In the present case, the first
respondent has not acted contrary to the principles of natural justice or beyond his jurisdiction,
meriting interfere with the impugned order -Apex Court in the Titaghur Paper Mills Co.Ltd.
versus State of Orissa', and Whirlpool Corporation versus Registrar of Trade Marks' heldin
essence that where right or liability is created by a statute which gives a special remedy for
enforcing it, the remedy provided by that statute must be availed of- in view of existence of
alternate statutory appellate remedy in the instant case, Court disinclined to exercise its
extraordinary power under Article 226 of the Constitution of India - Petitioner free to agitate the
revocation of license before jurisdictional bench of Tribunal within six weeks of receipt of this
order; Tribunal directed to entertain it without examining limitation. - WP dismissed : MADRAS
HIGH COURT
Madan Lalwani Vs CC
Cus - Pre-deposit - Board Circular 984 dated 16/09/2014 applies to appeals filed after the
amendment of section 129E of the Custom Act on 6.8.2014 - Tribunal is not inclined to review
own Order: CESTAT - Application dismissed : MUMBAI CESTAT