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2024 (6) TMI 191 - CESTAT KOLKATA
Exemption form service tax - services rendered in respect of railways and construction of road - piping work under railway line - boulder pitching for construction of road - invocation of extended period of limitation - HELD THAT:- The appellant has executed two work orders to their client namely, M/s. Vedanta Aluminium Ltd., Jharsuguda. The work order dated 31.07.2007 is meant for piping work in respect of railway lines. A perusal of the said work order shows that the works have been rendered to the railways and during the relevant period, services rendered to the railways were exempted from Service Tax.
Further, from the Work Orders, it is observed that the services rendered are rightly classifiable under the category of ‘works contract service’ as they involve transfer of property in goods. It is observed that the client has registered the aforesaid contracts under the Odisha Value Added Tax Act, 2004 and paid Works Contract Tax to the Government, but, in the Notice, no demand has been made under 'Work Contract Service'. Thus, it is observed that the demand confirmed under 'Commercial or Industrial Construction Service' is not sustainable and hence the same is set aside.
Invocation of extended period of limitation - HELD THAT:- There is no suppression with intention to evade payment of Service Tax established in the present case. Hence, the Show Cause Notice demanding Service Tax for the period 2007-08 issued on 20.10.2010 is barred by limitation. Accordingly, the demands confirmed in the impugned order are liable to be set aside on the ground of limitation also.
The impugned order is set aside - appeal allowed.
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2024 (6) TMI 190 - CESTAT KOLKATA
Demand of service tax confirmed by invoking extended period of limitation - Penalty - HELD THAT:- As per the Audit report, the appellant has paid the service tax as demanded. In that circumstances, the demand for the period up to March, 2016, is not sustainable against the appellant.
Further, as per the impugned order, the demand has been raised up to June, 2017, which is not included in the year 2016-2017. The said demand has been raised on the basis of Form 26AS. In this regard, the Works Contracts is perused - As per the Works Order, it is clear that the appellant was engaged in the activity of construction of road, which is exempted from payment of service tax.
Penalty - HELD THAT:- The demand of service tax is not sustainable against the appellant. As the demand is not sustainable, consequently, penalty is also not imposable on the appellant.
The impugned order is set aside - appeal allowed.
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2024 (6) TMI 189 - CESTAT KOLKATA
Demand of service tax - services received by these permanent establishments of the appellant abroad - reverse charge mechansim - disallowance of CENVAT Credit - appellant produced photo copies of the invoices before the adjudicating authority at the time of personal hearing - penalty imposition u/s 77 of Finance Act, 1994, and Rule 7(c) of Service Tax Rules, 1944.
Demand of service tax - services received by these permanent establishments of the appellant abroad - reverse charge mechansim - HELD THAT:- The appellant has been working through a network of branch offices located abroad. These branch offices are permanent establishments and not mere representative offices. They provide services to their clients in their own rights, raise invoices, incur expenditure, avail bank facilities, have its own technical and human resources and operate as independent units. They do not claim any reimbursement of expenditure from the Corporate Office.
Section 66A(2) of the Finance Act, 1994 reproduced above clearly lays down that permanent establishments in different countries shall be treated as separate persons. Therefore, the services received by these permanent establishments of the appellant abroad cannot be considered as services received by the appellant in India, on reverse charge basis. Thus, the demand of service tax from the appellant is not sustainable and accordingly, we set aside the demand confirmed in the impugned order on this count.
Disallowance of CENVAT Credit - appellant produced photo copies of the invoices before the adjudicating authority at the time of personal hearing - HELD THAT:- The appellant produced photo copies of the invoices before the adjudicating authority at the time of personal hearing. However, the adjudicating authority rejected those invoices on the ground that they were not authenticated and the invoices were not legible. The appellant now submits that they have the original copies of all the invoices and they can submit the same before the concerned authorities for verification. For the purpose of verification, the matter needs to be remanded back to the adjudicating authority.
Interest - Penalty imposition u/s 77 of Finance Act, 1994, and Rule 7(c) of Service Tax Rules, 1944 - HELD THAT:- Since the demand itself is not sustainable, the question of demanding interest and imposing penalty does not arise. As the demand is not sustainable, no penalty imposable under Section 77 of the Finance Act, 1994 and Rule 7(c) of the Service Tax Rules, 1944.
Appeal disposed off.
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2024 (6) TMI 188 - CESTAT ALLAHABAD
Maintainability of appeal - appeal rejected for failure to make mandatory pre-deposit in terms of Section 35F of the Central Excise Act, 1944, as made applicable to service tax cases vide Section 83 of Finance Act, 1994 - HELD THAT:- Hon’ble High Court in the case of SODEXO INDIA SERVICES PVT. LTD. VERSUS THE UNION OF INDIA AND ORS. [2022 (10) TMI 264 - BOMBAY HIGH COURT] held that 'it does appear that the confusion seems to be due to there being no proper legal provision to accept payment of pre-deposit under Section 35F of the Central Excise Act, 1944 through DRC-03. Some appellants are filing appeals after making pre-deposit payments through DRC-30/GSTR-3B. In our view, this has very wide ramifications and certainly requires the CBI & C to step in and issue suitable clarifications/guidelines/ answers to the FAQs.'
The learned Commissioner (Appeals) could have granted the refund of amount of pre-deposit wrongly made by DRC-03 to the Appellant and given an opportunity to deposit the said amount on its Integrated Portal instead of dismissing the appeal in limine. Because dismissing the appeal filed by the Appellant, even after making the pre-deposit, merely on the ground that it has not been deposited in the prescribed manner or by the prescribed Form, amounts to denial of substantial justice and the Commissioner (Appeals) has erred in shirking from its responsibility of deciding the appeal on merits - From perusal of paragraph 3 of the Instruction dated 28.10.22, it is evident that the tax under the existing law (Service Tax) shall be recovered as an arrear of tax under the CGST Act and the pre-deposit is neither in the nature of duty nor can be treated as arrears under the Service Tax law. Thus, when the service tax could be recovered as an arrear of Service Tax under CGST Act, after commencement of the CGST Act, then pre-deposit made through DRC-03 prior to 28.10.22 has to be treated as sufficient compliance, in view of the subsequent Instruction dated 18.4.23.
It is found appropriate to remand the matter to the learned Commissioner (Appeals) to decide the appeal on merits without further visiting the aspect of pre-deposit - appeal allowed by way of remand.
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2024 (6) TMI 187 - CESTAT CHANDIGARH
Maintainability of appeal - Refund of service tax paid erroneously - absence of challenge to assessment or self-assessment in appeal - export of services or not - intermediary services or not.
Maintainability of appeal - HELD THAT:- The Larger Bench in the appellant’s own case M/S SHREE BALAJI WAREHOUSE, M/S SATYA WAREHOUSE, M/S OM SHREE SAI RAM, M/S VIAVI SOLUTIONS INDIA PVT. LTD VERSUS COMMISSIONER OF CENTRAL EXCISE & SERVICE TAX, PANCHKULA [2023 (9) TMI 1478 - CESTAT CHANDIGARH (LB)] has categorically held that refund of service tax is maintainable even in the absence of any challenge to assessment or self-assessment in an appeal. The Larger Bench has considered the decision of Hon’ble Apex Court in the case of ITC LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE, KOLKATA -IV [2019 (9) TMI 802 - SUPREME COURT] and has distinguished the same by holding that the same is not applicable in the facts and circumstances of the present case. Moreover, after the Larger Bench order, this case has been listed before this Division Bench to decide the issue of refund on merits. Therefore, the present appeal is very much maintainable and its maintainability cannot be questioned at this stage. Accordingly, the objections raised by the Department on maintainability are hereby overruled.
Whether the services by the appellant to JDSU USA qualified as export of service and hence not exigible to service tax? - HELD THAT:- The place of provision of business promotion service shall be the location of the recipient of service which is outside India and such services shall qualify as export of service and hence not subject to service tax and this view has been taken by the Tribunal in various decisions stated/ relied upon by the appellant.
Intermediary services or not - HELD THAT:- From the perusal of the definition of the “Intermediary” during the period prior to 01.10.2014, it only pertained to facilitation of provision of service but facilitation of supply of service was inserted only w.e.f. 01.10.2014. Here it is pertinent to note that the period of dispute in the present case is from October 2013 to March 2014 and the definition of “Intermediary” during that time is applicable wherein the learned Commissioner (Appeals) in the impugned order in Para 7 & 8 has wrongly observed that the appellant is involved in the business promotion of selling of goods, providing of warranties of goods and hence covered under Rule 4 of POPS Rules, 2012 and further held that service provided by the appellant cannot be treated as export of service. In this regard, it is to be seen that both the authorities have wrongly applied amended definition of “Intermediary” which was made applicable from 01.10.2014 whereas the period of dispute in this case is from October 2013 to March 2014 and therefore the amended definition of “Intermediary” service cannot be applied in the present case - the services of business promotion / support and marketing service do not qualify as intermediary service.
It is also found that in the impugned order both the authorities below have wrongly observed that the appellant is providing technical services whereas, in fact, the appellant has provided promotional/ marketing services and not provided technical services viz. Repair Service, Erection Commissioning and Installation Service to JDSU USA; the said observation in the impugned order is factually erroneous.
The impugned order is not sustainable in law and is set aside - Appeal allowed.
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2024 (6) TMI 186 - CESTAT BANGALORE
CENVAT Credit - input and input services for construction of immovable property - denial of credit on the ground of non-payment of service tax or excise duty on the property - HELD THAT:- This issue is no more res integra in as much as the jurisdictional Karnataka High Court in the case of COMMISSIONER OF SERVICE TAX VERSUS M/S. GOLFLINKS SOFTWARE PARK PVT LTD. [2022 (12) TMI 472 - KARNATAKA HIGH COURT] in a similar set of facts has held that 'While constructing the immovable properties, assessee would have availed various services and paid input tax. The said building is used by the assessee in its business. Therefore, assessee must be entitled to avail the input services to discharge services on various out services.'
There are no merit in the impugned order and accordingly, the appeal is allowed.
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2024 (6) TMI 185 - MADHYA PRADESH HIGH COURT
Exception to the requirement of pre-deposit as contained in Section 35F of the Central Excise Act, 1944 which is applicable to Service Tax also - petitioner's contention is that in his bank accounts, a paltry sum is lying and therefore, he is not in a position to fulfill the requirements of Section 35F of the Act - HELD THAT:- Since the provision contained in Section 35F as is effective from 06.08.2014, makes only two exceptions namely that the extent of pre-deposit shall not exceed rupees ten crores and that the provisions of this Section shall not apply to the stay applications and appeals pending before any appellate authority prior to the commencement of the Finance (No.2) Act, 2014, no third exception can be carved out on the basis of repealed provisions of the said Act, therefore, the request of the petitioner to waive requirement of pre-deposit and for permission to file an application for waiver before the Appellate Tribunal, fails and is dismissed.
In view of the amended provisions contained in Section 35F of the Central Excise Act, 1944, it is held that amended provision being not parimateria to earlier provisions as were existing prior to 06.08.2014 will not have any application to the cases originating from the proceedings after 06.08.2014.
Accordingly, the petition fails and is dismissed.
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2024 (6) TMI 184 - PUNJAB AND HARYANA HIGH COURT
Recovery of excise duty - benefit of exemption under notification dated 28.02.1993 denied - levy of penalty as well - demand u/s 11A of the Central Excise Act - HELD THAT:- As per the notification providing for full exemption on concessional rate of duty, it has been provided that the said notification shall apply on the aggregate value of clearance of all the excisable goods for whom consumption only in circumstances other than where a manufacturer has one or more factories and from any factory by one or more manufacturer, exceeds Rs. 200 lacs in preceding financial year, the same was increased w.e.f. 01.04.1995 to Rs. 300 lacs vide notification dated 16.03.1995 - the notification would only be granting exemption in the cases where the manufacturers have cleared overall amount less than Rs. 200 lacs/300 lacs as the case may be. If the production from different factories and clearance is altogether more than the said amount, the exemption cannot be allowed.
Both the Appellate Authorities are agreed upon to conclude that infact the Jaybee Industries consisting of N. K. Aggarwal and Pardeep Aggarwal as partners was a single partnership firm having two factories one at Bathinda and another at Panchkula and, therefore, they were required to include the factories of goods from both the units and the exemption could not have been claimed on the said basis and the recovery of non-payment of duty for the period from July 1994 to May, 1995 is found to be correct and in order.
Applicability of Section 11 A - HELD THAT:- The same has not been raised at the stage of appeal below and the same could not be taken up in appeal at present.
Appeal dismissed.
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2024 (6) TMI 183 - CESTAT MUMBAI
Recovery of CENVAT Credit - dropping of proposal for recovery of credit under CENVAT Credit Rules, 2004 on procurement of duty-paid goods for export under advance license scheme of FTP.
The adjudicating authority held that credit was not to be denied merely for not having taken recourse to the privilege of using inputs that were not burdened with duties of central excise and that duty paid on clearance of ‘diethylene glycol’ could be taken as credit under rule 3 of CENVAT Credit Rules, 2004.
HELD THAT:- That the impugned goods are excisable is not in dispute and yet the reviewing authority avers that these are exempted from duties of central excise and, therefore, bereft of option to pay duty on clearance. Doubtlessly, export promotion schemes in the Foreign Trade Policy (FTP) envisage exemption from duties on procurement and the ‘advance licence/authorization scheme’, too, is no exception though such exemption is limited to imported goods only and under Customs Act, 1962. There are no authority that empowers central excise formations to enforce notifications issued under Customs Act, 1962 in furtherance of such schemes. The flexibility afforded to holders of ‘advance licence/authorization’ for import substitution, with substantially the same exemptions, does not flow from a parallel notification – actual or deemed – in relation to duties of central excise but from a general facilitation for all exports – under schemes or otherwise – to ‘detax’ export price in rule 19 of Central Excise Rules, 2001.
The reviewing authority did misconstrue the source of exemption from duties of central excise as a notification to which said proviso is attached for mandatory availment that a notification under rule 19 of Central Excise Rules, 2001 does not.
With the twin pillars on which the appeal of Commissioner of Central Excise, Belapur, at the instance of Committee of Chief Commissioners, rested having been broken, the relief sought in this appeal does not have any legal basis.
Appeal dismissed.
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2024 (6) TMI 182 - CESTAT MUMBAI
Levy under Central Excise Act, 1944 - Process amounting to manufacture or not - re-packing and labelling of ‘unmanufactured tobacco’ - HELD THAT:- A key element in fastening recovery of duty is determination of the appropriate tariff item in the Schedule to Central Excise Tariff Act, 1985; from the contents of the impugned order, we are unable to ascertain the reason for inferring that the impugned goods are covered by tariff item 4707 9000 of Schedule to Central Excise Tariff Act, 1985 in accord with the General Rules for Interpretation of the Tariff. There is also no finding as to the impact of the definition of ‘manufacture’ on section 3 of Central Excise Act, 1944 and its applicability to the process undertaken by the appellant de hors the amendment to ‘excisable goods’ which has no bearing on taxability but only on the rate of duty. In the absence of these critical evaluations, the impugned order cannot be adjudged as being legal and proper.
That must be rectified and to enable that, it is necessary to set aside the impugned orders - appeals of the assessee restored before Commissioner of Central Excise & Customs (Appeals), Aurangabad for a fresh hearing and decision - appeal allowed by way of remand.
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2024 (6) TMI 181 - CESTAT CHANDIGARH
Cenvat Credit - scrapped/raw material which has not been used in the manufacturing process - time limitation.
Merits of the case - HELD THAT:- The entire case was built on the basis of entry in the ledger and there was no inquiry/investigation into the matter; no statement was recorded. The appellant has maintained proper records which is verified by the drug authorities from time to time and moreover, Chartered account certificate has also been placed on record which clearly certified that there is no write off input and moreover, the variance is only 0.28% which is normally accepted in the industry.
Reference made to the decision of the Tata Motors Ltd. Vs. Commissioner of Central Excise, Pune-I [2021 (11) TMI 830 - CESTAT MUMBAI] wherein the Division Bench of the Tribunal has considered various decisions on this issue and has observed that 'the CENVAT Credit cannot be denied to the appellant on a theoretical variance in the inputs.'
Time limitation - HELD THAT:- The show cause notice in the present case has been issued only on the basis of audit and no further inquiry/investigation was done. Further, the appellant has been regularly filing returns and was subjected to audit from time to time and has not suppressed any material with intention to evade payment of duty. In view of these facts, the entire demand in the present case is barred by limitation.
The impugned order is not sustainable in law and is set aside - appeal allowed.
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2024 (6) TMI 180 - CESTAT CHANDIGARH
Cash refund in terms of transitional provision under Section 142(6)(a) of the CGST Act, 2017 - denial of benefit of Cenvat Credit in terms of Rule 3(1) of Cenvat Credit Rules, 2004 - HELD THAT:- After considering the provisions of Section 142(6)(a) of the CGST Act, 2017, Section 11B(2) of the Central Excise Act, 1944 and Rule 3(1) of the Cenvat Credit Rules, 2004, the Tribunal in various decisions has allowed the refund of Cenvat Credit of CVD & SAD paid through various challans produced on record.
It is also found that the Tribunal in the case of SRI CHAKRA POLY PLAST INDIA PVT LTD VERSUS COMMISSIONER OF CENTRAL TAX MEDCHAL – GST [2024 (1) TMI 927 - CESTAT HYDERABAD] has considered the earlier judgments in the cases of M/S MITHILA DRUGS PVT. LTD. VERSUS COMMISSIONER, CENTRAL GOODS AND SERVICE TAX, UDAIPUR (RAJASTHAN) [2022 (3) TMI 58 - CESTAT NEW DELHI], M/S MITHILA DRUGS PVT. LTD. VERSUS COMMISSIONER, CENTRAL GOODS AND SERVICE TAX, UDAIPUR (RAJASTHAN) [2022 (3) TMI 58 - CESTAT NEW DELHI], M/S. ITCO INDUSTRIES LTD. VERSUS COMMISSIONER OF GST & CENTRAL EXCISE, SALEM [2022 (6) TMI 1040 - CESTAT CHENNAI] and FLEXI CAPS AND POLYMERS PVT LTD VERSUS COMMISSIONER, CGST & CENTRAL EXCISE-INDORE [2021 (9) TMI 917 - CESTAT NEW DELHI]], and by following these case-laws on this issue, has allowed the refund of CVD & SAD.
The appellant is entitled to refund of Cenvat Credit of CVD amounting to Rs.23,72,607/- and SAD amounting to Rs.10,21,081/-; and not the interest paid on delayed payment of duties as claimed by the appellant - Appeal allowed in part.
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2024 (6) TMI 179 - CESTAT MUMBAI
Recovery of short paid duty - Jurisdictional Authority's Power to Issue Provisional Assessment Orders Suo Motu - revision for ascertainment of additional duty liability - Compliance with Rule 7 of Central Excise Rules, 2002 - HELD THAT:- The impugned order has set out the issue in dispute correctly but has gone on to find that the lack of exercise of option by an assessee in such situations enables the jurisdictional central excise authorities to do so in the interests of revenue. This is not a sustainable proposition as rule 7 of Central Excise Rules, 2002 is unambiguous in vesting the option only in the assessee to decide upon the finality of assessment – which is relevant only for the purposes of filing of monthly returns - in reporting discharge of duty liability for each month - Non-exercise of the option implies that the assessment is final and any duty not paid or short-paid is liable to be recovered by recourse to section 11A of Central Excise Act, 1944.
The Tribunal, in FINOLEX CABLES LTD VERSUS COMMISSIONER OF CENTRAL EXCISE, PUNE – I [2023 (12) TMI 169 - CESTAT MUMBAI] of Commissioner of Central Excise (Appeals), Pune–I for the immediately preceding period, has held that 'in the absence of exercise of option by the assessee for ‘provisional assessment’, it is not open to central excise authorities to deem the clearances to have been provisional and to proceed with final assessment for each year.'
The impugned order flies in the face of the law and is set aside to allow the appeal of M/s Finolex Cables Ltd. For the same reason the appeal of Commissioner of Central Excise, Pune–I is dismissed.
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2024 (6) TMI 178 - CESTAT MUMBAI
Refund of CVD paid under the existing statute, Central Excise Act, 1944 - whether the appellant is eligible to claim refund of Additional Duties of Customs (CVD) paid on re-import of goods under the provisions of Section 142(3) of the CGST Act, 2017? - HELD THAT:- It is found that the larger bench in M/S. BOSCH ELECTRICAL DRIVE INDIA PRIVATE LIMITED VERSUS COMMISSIONER OF CENTRAL TAX, CHENNAI [2023 (12) TMI 1145 - CESTAT CHENNAI-LB] has examined the issue regarding whether this Tribunal is the appropriate authority to decide the issue in appeal against the order passed in respect of the matter relating to refund under Section 142(3) of the CGST Act, 2017 and has held that an appeal against such order would lie with this Tribunal.
By perusal of the above order of the Larger Bench of the Tribunal, it is found that it has been made clear that the issue of deciding an appeal against the order relating to the refund decided under the provisions of Section 142 of CGST Act, 2017 is required to be dealt by this Tribunal.
In the present case, as the CVD was paid subsequent to the appointed date (01.07.2017) for introduction of GST, i.e., on 18.07.2017, the appellant was unable to take credit of the same as Cenvat credit. Learned Commissioner (Appeals) had accordingly gave a finding that the appellant is eligible to avail credit of CVD paid on inputs under the Cenvat Credit Rules, 2004; however, he did not agree to the contention of the appellant stating that the provisions of Section 140(5) of CGST Act, 2017 provide for allowing credit of eligible duties. Further, learned Commissioner (Appeals) had held that the provisions of Section 142(3) ibid is not applicable to the present case and hence no refund can be claimed by the appellant under this provision.
Thus, there are strong grounds to consider refund of CVD paid on re-imported ‘Metformin HCL BP’ under B/E No. 9247561 dated 10.04.2017 and under Challan dated 18.07.2017 for an amount of Rs.1,50,147/- for which the appellant had filed the refund claim in the prescribed format under the provision of Section 142(3) CGST Act, 2017. Accordingly, the impugned order dated 07.01.2020 is not legally sustainable.
Appeal allowed.
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2024 (6) TMI 177 - CESTAT ALLAHABAD
Abatement of appeal - non-prosecution of the case - adjournment of matter beyond three times - HELD THAT:- In case of Ishwar lal Mali Rathod [2021 (9) TMI 1301 - SUPREME COURT] condemning the practice of adjournments sought mechanically and allowed by the Courts/Tribunal’s Hon’ble Supreme Court has observed 'Considering the fact that in the present case ten times adjournments were given between 2015 to 2019 and twice the orders were passed granting time for cross examination as a last chance and that too at one point of time even a cost was also imposed and even thereafter also when lastly the High Court passed an order with extending the time it was specifically mentioned that no further time shall be extended and/or granted still the petitioner – defendant never availed of the liberty and the grace shown.'
There are no justification for adjourning the matter beyond three times which is the maximum number statutorily provided - Appeal is dismissed for non prosecution in terms of Rule 20 of CESTAT Procedure Rules, 1982.
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2024 (6) TMI 176 - CESTAT ALLAHABAD
Invocation of extended period of limitation - suppression of fact - denial of CENVAT Credit under Rule 2(l) which are taken in relation to manufacturing & clearance of final products.
Invocation of extended period of limitation - suppression of facts - HELD THAT:- In the case of Surya Vistacom Pvt. Ltd. [2021 (11) TMI 339 - CESTAT KOLKATA] Tribunal has held that 'the details have been culled out by the adjudicating authority from the available records and there is no new or fresh tangible materials available in the hands of the adjudicating authority to make out a case of wilful misstatement or wilful suppression. Therefore, the Tribunal was fully justified in holding that the extended period of limitation could not have been invoked.'
In case of Meghmani Dyes & Intermediates Ltd. [2013 (6) TMI 141 - GUJARAT HIGH COURT] it was held that To make the demand for duty sustainable beyond the period of six months and upto a period of five years in view of the proviso to Section 11A of the Act, the Revenue is obliged to establish by cogent evidence that the duty of excise has not been levied or paid or short-levied or short-paid or erroneously refunded by reasons of either fraud or collusion or wilful mis-statement or suppression of facts or contravention of any provision of the Act or rules made thereunder, with intent to evade payment of duty.
As the demand has been made invoking extended period of limitation and it is not found that the same is available to Revenue for making this demand. The impugned order cannot be sustained on this ground itself.
Denial of CENVAT Credit - HELD THAT:- As the demand is barred by limitation, the question of admissibility of credits on merits not discussed.
Appeal allowed.
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2024 (6) TMI 175 - CESTAT BANGALORE
CENVAT Credit - exempted Biscuits having retail price less than Rs.100/- - requirement to pay 10% of the value of the exempted Biscuits - appellant already reversed proportionate cenvat credit with interest before issuance of Show Cause Notice, availed on common inputs/input services but used in the manufacture of exempted Biscuits - HELD THAT:- Since the appellant has reversed the credit with interest availed on inputs and input services attributable to exempted products, accordingly in view of the series of judgments referred to by the learned advocate for the appellant and also in view of the retrospective amendment to the relevant Cenvat Credit Rules, 2004 vide Section 72 and 73 of Finance Act, 2010 and Notification No. 13/2016-CE(NT) dated 01.03.2016, the demand of 10% of the value of the exempted goods confirmed by the learned Commissioner in the impugned order cannot be sustained.
Reliance can be placed in M/S. SHEELA FOAM PVT. LTD. VERSUS COMMR. OF CENTRAL EXCISE, KOLKATA-IV AND MR SATISH AGARWAL M/S. SHEELA FOAM PVT. LTD. EXECUTIVE ACCOUNTANT VERSUS COMMR. OF CENTRAL EXCISE, KOLKATA-IV [2024 (2) TMI 957 - CESTAT KOLKATA] where on similar issue demand was set aside.
The impugned order is set aside - appeal is allowed.
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2024 (6) TMI 174 - CESTAT BANGALORE
Classification of goods - LIV 52 Protec - goods misclassified as Animal Feed Supplement under Central Excise Tariff Heading 230990/23099010 of Central Excise Tariff Act, 1985 - whether the polyherbal preparation “Liv 52 Protec” manufactured by the appellant is classifiable under CETH 2302/230990/23099010 as ‘Animal Feed Supplement’ as classified by the appellant or under CETH 300339/30049011 as ‘Ayurvedic Medicaments’ as adjudged by the revenue? - Extended period of limitation - Penalties imposed under Section 11AC and Rule 25 of Central Excise Rules, 2002.
Classification of goods - HELD THAT:- It is found that Tariff item Heading 23099010 under Chapter Heading 2309, “Preparation of a kind used in animal feeding”, under others reads as ‘Compounded animal feed’. The Tariff Heading 30049011 under Chapter Heading 3004, “Medicaments (excluding goods of heading 3002, 3005 or 3006) consisting of mixed or unmixed products for therapeutic or prophylactic uses put up in measure doses (including those in the form of transdermal administration systems) or in forms or packages for retail sale”, under others, “Ayurvedic, Unani, Siddha, Homeopathic or Biochemic systems medicaments, put up for retail sale” reads as “of Ayurvedic systems”.
The major herbs in ‘Liv 52 Protec’ are Andrographis paniculata (Yavtika) enhances the body’s resistance against common infections by stimulating the production of antibodies. It also acts as a hepato-protective that helps prevent liver damage. Phyllanthus amarus (Bhumyaamalaki) is a rich antioxidant, which is effective in the treatment of infective hepatitis. It contains wedelolactone and dimethyl wedelolactone and stimulates the secretion of digestive enzymes. It eliminates toxins and aids in the regeneration of hepatopancreas. The herbal ingredients in the impugned product also have similar hepatoprotective properties - ‘Liv 52 Protec’ liquid stabilizes the hepatic cell membrane and promotes regeneration of the liver and also protects the liver from toxins, drugs and chemicals. Liv 52 Protec, is an appetite stimulant that increases and restores appetite in animal.
In this case, the appellant is manufacturing a similar product ‘Liv 52 Vet’ and classifying the same under Chapter Heading 30 as an ‘Ayurvedic medicament’ and paying the appropriate duty. However, ‘Liv 52 Protec’ is branded and marketed as animal feed supplement. Animal feed supplements are mixtures that are added either to animal feed or fed directly to animals to provide extra nutrients such as vitamins and minerals. The impugned product ‘Liv 52 Protec’ does not have vitamins or minerals, which would supplement the animal feed. Further the tariff heading item 2309 9010 reads as ‘Compounded animal feed’ and not as ‘animal feed supplement.’- the classification of the impugned product as animal feed supplement is not proper under chapter heading 23 and it should be classified under Chapter 30.
The product ‘Liv 52 Protec’ is rightly classifiable under Chapter Sub-heading 300339 for the period upto February 2005 and under Chapter subheading 30049011 from March 2005 onwards - the ‘Liv 52 Protec Liquid’ in bulk is exported under the Chapter Heading 30039011.
Invocation of the extended period - HELD THAT:- The appellant has been submitting ER-1 showing the details of the goods manufactured and cleared by them. The details of goods cleared inter alia include ‘Liv52 Protec’ as well as ‘Liv 52 Vet Liquid’. Further the Department has also conducted an audit for the period under dispute and no audit point was raised to indicate that there is suppression of facts and the Department is fully aware of the facts and issues and the goods were cleared in accordance with the approved classification list. Therefore, the invocation of extended period for confirmation of demand of duty for the period May 2002 to April, 2007 is not legally sustainable.
Penalties imposed under Section 11AC and Rule 25 of Central Excise Rules, 2002 - HELD THAT:- In the facts and circumstances of the case and as the issue involved is classification, the penalties imposed under Section 11AC and Rule 25 of Central Excise Rules, 2002 are not legally sustainable, hence they are dropped.
Appeal disposed off.
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2024 (6) TMI 173 - ANDHRA PRADESH HIGH COURT
Dismissal of petitioner’s stay application during pendency of the petitioner’s appeal before the Andhra Pradesh Value Added Tax Appellate Tribunal at Visakhapatnam - petitioner filed petition seeking stay of collection of balance amount before 4th respondent of which stay petition was rejected by the impugned order - HELD THAT:- Indisputably, the petitioner has filed the appeal which is pending for consideration before the Tribunal, Visakhapatnam. It is also not disputed that the petitioner complied with the statutory deposit for filing appeal. Once the statutory appeal is pending before the Appellate authority for adjudication, ordinarily the recovery of the balance amount deserves stay unless for special reasons, to be recorded in the order, recovery of the balance amount deserves not to be stayed or the balance amount has to be recovered even during pendency of the appeal, which is a statutory and valuable right. The stay may be the subject to imposing some conditions, which is also contemplated by Section 33 (b) of APVAT Act, 2005 - The impugned order does not record any cogent reasons to reject the stay petition.
It was provided that the Appellate authority shall make endeavour to decide the appeal within a specific period. The order of rejection of the stay was passed with the conditions. In that case, in addition to the statutory deposit of 25%, the petitioner therein had deposited in total 50% inclusive of 25% of the statutory deposit under the orders of the Court passed in Writ Petition No. 10 of 2023 and considering that total 50% deposit, the stay was granted during pendency of the appeal before the Appellate Tribunal.
The respondent No. 4 is not justified in rejecting the petitioner’s stay application. The impugned order, therefore, is set-aside - Petition allowed in part.
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2024 (6) TMI 172 - GAUHATI HIGH COURT
Refund of excess tax - Collection of entry tax from the petitioner Company on entry of packing materials into the State of Assam for packing of goods for sale - HELD THAT:- A bare reading of Rule 29(1) of the Assam Value Added Tax Rules, 2005 indicates that a time frame is prescribed for making the application for refund in the prescribed Form, i.e, Form 37. Further, power is also given to the prescribed authority to condone the delay for filing the application within the prescribed period, if sufficient cause is shown.
What transpires from the above is that there is a detailed mechanism prescribed under the provisions of law for claiming refund. It appears from the decision of this Court in TATA TEA LTD. AND ANR. VERSUS THE STATE OF ASSAM AND ORS [2015 (3) TMI 1438 - GAUHATI HIGH COURT], that there is no entry tax leviable on the packing materials. In such situation, it appears that the petitioner has paid tax in excess of what was due to him.
Be that as it may, as the Act and Rules provides a mechanism for filing application for refund in such situation, this Court is of the view that the petitioner has approached this Hon’ble Court by not exhausting the remedy provided under the law and hence, is not entitled for any relief from this Court. As such, there is no justification for keeping this matter pending any longer.
This Court directs that the petitioner be at liberty to make an application under Section 50 of the Act by submitting all the details in the prescribed form within a period of 1(one) month from today and if such application is made, the authorities in calculating the prescribed time shall exclude the time spent from filing the writ petition till submission of the application as directed and thereafter, consider the application for refund on its merit.
The petition is disposed off.
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