|
Advanced Search Options
Case Laws
Showing 481 to 500 of 1354 Records
-
2024 (3) TMI 874
Valuation of imported goods - rejection of declared value - Inclusion of lump sum and periodical patent and technology know how fee paid by appellant to the foreign company in the transaction value - order passed by Commissioner (Appeals) remanding the matter to the adjudicating authority to reconsider the rejection of transaction value is legal and proper or not.
Whether the lump sum and periodical patent and technology know how fee paid by appellant to the foreign company has to be included in the transaction value is legal and proper? - HELD THAT:- As per Rule 10 (1) (c), the payment in the nature of royalty or technical know how must be a condition pre-requisite for the supply of imported goods by the foreign supplier. The royalty or technical know-how fee is to be included, if directly or indirectly it is a condition of the sale of imported machinery. The department therefore has not only to look whether there is payment of royalty or technical know how fee, but also have to examine the pricing arrangement agreed by the parties. Only if the royalty and technical know how fee is paid as a condition of sale of the machinery, it can be added to the transaction value. In the present case, there are nothing stipulated in the agreement that payment of royalty and technical know-how fee is a condition of sale of the imported machinery. The department has not been able to adduce any evidence in this regard.
The Hon’ble Apex Court in the case of COMMISSIONER OF CUS. (PORT), CHENNAI VERSUS TOYOTA KIRLOSKAR MOTOR P. LTD. [2007 (5) TMI 20 - SUPREME COURT] had occasion to analyse the very same issue in regard to erstwhile Rule 9 (1) (c) of Customs Valuation (Determination of Price of Imported Goods), Rules, 1988. It was held that royalty and technical know how fee must be payable by the importer as a condition of import and that a distinction clearly exists between the amount payable as a condition of import and the amount payable in respect of the manufacturing activity.
The royalty and technology know how fee being not a condition of sale, is not to be included in the transaction value. The issue is held in favour of the appellant.
Whether the order passed by Commissioner (Appeals) remanding the matter to the adjudicating authority to reconsider the rejection of transaction value is legal and proper? - HELD THAT:- From the order passed by the adjudicating authority, it is found that in the operative portion of the order, it is stated that the ‘transaction value is rejected’. However, there is no discussion or re-determination of transaction value. The original authority has assumed that for loading the royalty and technology know how fees, the transaction value has to be rejected. The department has filed appeal before the Commissioner (Appeals) against this order of adjudicating authority contending that if the transaction value is rejected, the same ought to have been redetermined by the original authority which he has not done. The Commissioner (Appeals) in internal page 5 of the impugned order has discussed this issue and observed that once the transaction value has been set aside, it is for the adjudicating authority to redetermine the same. For this limited purpose, the matter has been remanded by him. The finding of the original authority rejecting the transaction value is patently erroneous.
The department does not dispute the transaction value declared by importer and the only issue is as to whether the patent and technical know how fee is to be loaded to the transaction value. There is no requirement to remand the matter for this purpose so as to redetermine the transaction value as there is no grounds stated for rejecting the transaction value. The declared transaction value is upheld. The order for loading the royalty and technology know how fee to the transaction value is set aside.
Appeal allowed.
-
2024 (3) TMI 873
Refund including cash refund of DEPB/FPS scrips - denial on the ground that refund claims were hit by the principles of unjust enrichment - Determination of product prices based on the prevailing price for copper in the London Metal Exchange (LME). - HELD THAT:- In M/S. VEDANTA LTD. VERSUS CC, TUTICORIN (VICE-VERSA) [2018 (6) TMI 528 - CESTAT CHENNAI], relied upon by the First Appellate Authority as well as the respondent, it is found that there is no change in the facts; admittedly, the price prevailing in LME was in no way under the control of the respondent and further, this Bench in the respondent’s own case has categorically held that the final product price is based on the price prevailing in LME which has no relation to the cost of raw material including customs duty, for which reliance has been placed on the decision of the Hon'ble Supreme Court in the case of STATE OF RAJASTHAN & ORS VERSUS HINDUSTAN COPPER LTD. [1997 (11) TMI 516 - SUPREME COURT] - This Bench has thus concluded that the stand of the Revenue insofar as unjust enrichment was concerned, had no merit.
The Revenue has not been able to distinguish the above case nor is there any evidence placed on record to aver that there was any change in either facts or law, nor has the Revenue placed anything on record to state that the above final orders have been appealed to higher judicial forum and, if so, the status of the same. Hence the ratio of the above order squarely applies to the case on hand as well.
The Revenue has not made out a case to disturb the finding of the First Appellate Authority in the impugned order. Consequently, Revenue’s appeal lacks merit - the appeal filed by the Revenue is dismissed.
-
2024 (3) TMI 872
Re-assessment of imported goods - 30 MT of PVC Resin SG 5 (Suspension Grade) - it appeared that the goods were liable to anti-dumping duty @ USD 147.96 PMT in terms of Sl. No. 2 of Notification No. 32/2 -Customs (ADD) dated 10.08.2019 instead of Sl. No. 1 of the said notification prescribed anti-dumping duty @ USD 61.14 PMT, as claimed by the appellant - HELD THAT:- The invoices and packing list, as well as Bill of Lading clearly indicate that the manufacture is M/s. Xinjiang Shengxiong Chlor-Alkali Co. Ltd. The certificate at page 41 also indicates that manufacturing is by M/s. Xinjiang Shengxiong Chlor-Alkali Co. Ltd. Company, a group company of M/s. Xinjiang Zhongtai Chemical Co. Ltd. It is thus clear from the evidence that the Alkali Company (XSCCL) was actually the manufacturer and M/s. Zhonglai Chemical Co. Ltd.(XZCCL) had only exported goods clearly mentioning that Alkali Company was the manufacturer and also that their company was exporter. Even the certificate of origin of Chinese authority mentions that exporter was M/s. Zhonglai Chemical Co. Ltd., and the name of manufacturer was M/s. Xinjiang Shengxiong Chlor-Alkali Co. Ltd and this has remained an unrebutted piece of evidence by an independent authority. Further learned advocate has provided para 33 of the final findings of Notification of Anti Dumping Authorities, which mentions Alkali Co., as producer and Chemical Co., as exporter.
The Order-In-Appeal is not maintainable and the Bill of Entry was correctly filed in so far as claim of ADD at lower rate was concerned - appeal allowed in part.
-
2024 (3) TMI 871
Valuation of imported goods - stamping foils - rejection of declared value - enhancement of value - statement relied upon by the department was recorded under duress or under coercion or undue influence - It is seen that the department’s case is based primarily on the evidence of retrieval of data from the hard disk seized from the premises of the appellant firm - HELD THAT:- On consideration of overall circumstances in which the statement of director Shri. Ramesh K Gidwani was recorded and pattern of the same including the content of the initial statement which while indicating proforma invoice to be correct value did not mention the relevant grade of stamping foils also. The medical evidence about injuries and their treatments were mentioned while rebutting letters of the department in their retraction.
It is also found that though the Hon’ble High Court of Gujarat in KIRAN TEX FAB PVT LTD & 1 VERSUS UNION OF INDIA THROUGH SECRETARY & 6 [2011 (5) TMI 941 - GUJARAT HIGH COURT] has not specifically dealt with the fact of coercion while granting relief of presence of advocate. The series of statements recorded thereafter of the directors are exculpatory. It is thus clear that they were serious doubts on record as to the nature of initial statement and the onus clearly shifted on the department to indicate that the initial statement dated 13.10.2010 was voluntary and same should have been subjected to examination-in-chief by the adjudicating authority, at least in the factual background of the matter before placing reliance on the same.
When statement was retracted, the investigating officer instead of pronouncing his own version as to why the statement was voluntarily, should have instead of left this job to be done by the adjudicating authority while adjudicating the matter. Another opportunity before higher officer can be an apt course of action to follow in such situation - it is found that initial statement dated 13.10.2010 could not have been relied upon without discharge of burden by the department of same being voluntary by examination of the entire statement of director by the adjudicating authority. Apart from above, it is also found that there is no evidence on record of any excess payment having been made of excess remittance, and admission of the same.
Thus, it is clear that not only Customs Valuation Rules have to be sequentially followed but also that the electronic evidence can only be relied upon by the department as per provision of Section 138C which lays down various conditions in sub clause (2) about which there is no mention of the same having been followed.
Thus, in the facts and circumstances of the matter enhancement of value as well as appreciation of evidence has been improperly done in the impugned order - the impugned order is therefore, set aside - appeal allowed.
-
2024 (3) TMI 870
Valuation of imported goods - inclusion of royalty and the cost of advertisement incurred by the Appellant in India in assessable value - related party - Rule 10(1)(c) and Rule 10 (1)(e) of the Customs Valuation Rules 2007 - demand of differential duty alongwith interest, redemption fine and penalty - extended period of limitation - HELD THAT:- Rule 10(1)(e) 0f the Customs Valuation Rules 2007 provides for addition of all other payments actually made or to be made as a condition of sale of the imported goods, by the buyer to the seller or by the buyer to a third party to satisfy and obligation of the seller, to the extent that such payments are not included in the price actually paid (transaction value). It is found that there is total absence of the prescribed condition present as the appellant is not obliged to incur any particular amount or percentage of invoice value towards sales promotion/ advertisement. Further, we find that the activity of advertisement and sales promotion is a post-import activity incurred by the appellant on its own account and not for discharge for any obligation of the seller under the terms of sale - As per the stipulation in the agreement, the appellant is obliged to be responsible for sales and distribution in its territory of distribution and further to make such expenditure in consultation with the seller, does not attract the provisions of Rule 10(1)(e) of CV Rules.
The appellant and M/s. Speedo or M/s. Jockey International are no way related parties as their relationship is principal to principal basis and the fact they are sole distributor in no way makes them related parties as per the Customs Act or the Valuation Rules. Moreover, they have imported from unrelated suppliers who have nothing to do with Jockey International and the distributed products have nothing to do with the licensed products as far as royalty is concerned. The issue being one of interpretation of what should be the value there is nothing brought on record to prove any wilful suppression of facts and therefore invocation of extended period is not justified.
The impugned order set aside - appeal allowed.
-
2024 (3) TMI 869
Classification of imported goods - fish protein - to be classified under Customs Tariff Heading 3504 0099 or under chapter heading 0511 9190? - suppression of the correct description of the goods/ misdeclaration of goods - invocation of Extended period of limitation.
Whether the imported item is fish protein as declared by the appellant or is it processed/demineralised fish scales at as per the test reports? - HELD THAT:- There is no dispute that the Fish Scales have undergone the process called Decalcification or demineralization. The resultant product essentially consists of protein and moisture, with traces of inorganic substances (i.e. crude ash) and other impurities. The decalcified Fish Scale contains various types of proteins of which Collagen Protein Type I is the major ingredient and the Proteins are made up of diverse amino acids, out of them the main amino acids that make collagen are Proline, Glycine and Hydroxy proline and this type of Protein is called as Collagen and Collagen Protein is the most abundant of the Protein in the Fish Scale are not at all in dispute. Demineralisation is considered as the primary procedure for preparation of the scale for the extraction of collagen. Based on the above it is very clear that the product imported by itself is not a protein but the protein is extracted only after further processing is being undertaken by the appellant - It is also admitted that after certain processes the protein is extracted and then exported. Therefore, the question arises whether the item is classifiable as demineralised fish scale under chapter heading 0511 or as protein under CTH 3504.
Whether the product is to be classified under chapter heading 0511 9190 based on the description is demineralised fish scales allowed to be classified under chapter heading 3504 0099 as claimed by the appellant? - HELD THAT:- In the present case, the test reports and the technical literature clearly establish that the product imported is demineralised fish scale. As observed by the apex court in the above case the content of protein cannot establish the product as a protein instead it is only a source of protein. More over there is a specific entry for fish waste and it is a settled issued that specific entry will be preferred over other entries and the chapter notes, headings and the explanatory notes clearly establish the product is rightly classifiable under Chapter 5. In view of the above, the products imported by the appellant are rightly classifiable under Chapter Heading 0511 9090.
As rightly stated by the Learned Senior Counsel for the Revenue in physical appearance and smell, the goods were nothing but fish scales, the only process that raw fish scales had undergone is removal of calcium from the outer layer of the fish scales, which was only a preparatory process for further extraction of protein called collagen. It is also an admitted fact that the item imported is not protein but a rich source of protein the processes undertaken by the appellant in their factory clearly bring out this aspect. Classification is based on the description at the time of import and not on the basis of its content as claimed by the appellant.
Whether the appellant had mis-declared the description of the product in order to claim the benefit of advance authorization? - HELD THAT:- The question of disallowing the benefit of advance authorisation scheme during this period is not sustainable in as much as the goods were declared as fish protein and item was cleared as fish protein as per the advance authorisation scheme. Moreover, these imported goods were actually used in the manufacture of export goods and exported as per the notification 96/2009 is also not under dispute. The fact remains that all the conditions of the notification were satisfied and accordingly all the bills of entry serial number 1 to 42 are to be allowed as per the advance authorisation scheme since the above test reports holds good for all imports made during this period where no fresh samples were drawn or tested.
The advance authorisation license obtained by them for fish protein is a misdeclaration and therefore the imports made by the appellants are not in accordance with the provisions of the Foreign Trade Policy. The import of these products shall be allowed only against a sanitary import permit to be issued by this department as per the procedure laid down in the first schedule annexed to this Notification. For the reasons discussed above the benefit of Advance authorisation is to be denied only prospectively for the consignments where samples were drawn and thereafter. Accordingly, the demand is upheld for 6 bills of entry from Sl.no 43 to 48. The other 9 bills of entry which are provisionally assessed are to be reassessed by reclassifying the same under Chapter Heading 0511.
Whether the appellant had made any willful mis-declaration of the description of the goods which attracted invocation of extended period under the provisions of the Customs act 1962 which warranted imposition of various penalties? - HELD THAT:- Since it is a classification issue and the question of benefit of the scheme is allowed for 42 consignments and the other 9 consignments are under provisional assessments, the question of redemption fine or penalty does not arise.
Appeal allowed in part.
-
2024 (3) TMI 868
Attachment of Properties - Large-scale irregularities committed by some share brokers in collusion with the employees of Banks and Financial Institutions - diversion of funds from the banks/FIs to the individual accounts of certain brokers - Section 10 of the Special Court (Trial of Offences relating to transactions in Securities) Act, 1992 - HELD THAT:- The entire case of the Custodian regarding subsisting debts of the appellant towards respondent Nos. 6, 7 and 8 was based on a communication received from the Income Tax Department. The appropriate witness to prove such communication would be the official concerned from the Income Tax Department. However, as has been mentioned above, no witness from the Income Tax Department was examined in support of the recovery application. Even the communication forwarded by the Income Tax Department and relied upon by the Custodian was not proved by proper evidence.
The appellants herein took a categoric stand in their depositions that they had returned the amounts borrowed from respondent Nos. 6, 7 and 8, but the books of accounts were not available because of lapse of time. The said plea of the appellants herein could not be treated as unnatural or an afterthought because once the transactions were completed and the loans were repaid, there was no reason for the appellants to have entertained a belief that after a period of about 13 years, they would be required to present the account books pertaining to transactions. It was neither a requirement in law nor could it be expected from the appellants herein to retain the books of accounts after more than a decade of the alleged suspicious transactions.
Resultantly, the conclusions drawn and the findings recorded in the impugned judgments passed by the Special Court that the appellants herein failed to prove the fact that the amounts had been repaid to the benami companies of the notified person, namely, Pallav Sheth do not stand to scrutiny and cannot be sustained as being contrary to facts and law.
Appeal allowed.
-
2024 (3) TMI 867
Condonation of delay in filing the Civil Appeals - Section 62 of the Insolvency and Bankruptcy Code 2016 - HELD THAT:- There is a delay of 216 days and 141 days respectively in filing the Civil Appeals. The delay is beyond the maximum period which can be condoned under Section 62 of the Insolvency and Bankruptcy Code 2016.
The Civil Appeals are dismissed on the ground of limitation.
-
2024 (3) TMI 866
Condonation of delay of 474 days in filing the Civil Appeals - HELD THAT:- Even before the Special Leave Petition was filed, the period of limitation under Section 62 of the IBC had come to an end - There is a delay of 474 days in filing the Civil Appeals, much beyond the period which can be condoned in terms of the provisions of Section 62 of the Insolvency and Bankruptcy Code 2016.
There are no reason to entertain the Civil Appeals since they are barred by limitation - Since the appellants seek to withdraw the appeals, the appeals dismissed as withdrawn.
-
2024 (3) TMI 865
Admission of section 9 application - Insurance Company has made payment to the Operational Creditor of its claim - third party liability - Liability of Corporate debtor to discharge its debt - preexisting dispute between the parties - it was held by NCLAT that Section 9 Application is fully maintainable and the fact that Insurance Company has made payment to the Operational Creditor of its claim, cannot be a ground to reject Section 9 Application - HELD THAT:- The order of the National Company Law Appellate Tribunal dated 13 December 2023 does not raise any substantial question of law so as to warrant interference in the appeal under Section 62 of the Insolvency and Bankruptcy Code 2016.
However, the time which was granted by the NCLAT by its order dated 13 December 2023 for deposit shall stand extended, on the request of the counsel for the appellant, until 8 April 2024. In the event of default, the consequences as envisaged in the order of the NCLAT shall follow.
Appeal dismissed.
-
2024 (3) TMI 864
Initiation of CIRP - Failure to make deposits the entire OTS amount - section 7 still pending - It is submitted that the Appellant is ready to deposit the entire OTS amount which was earlier arrived along with 12% interest in the Court to show his bonafide - HELD THAT:- Admittedly, Section 7 application is still pending before the Adjudicating Authority. From the facts which have been brought on the record, it is clear that the deposit could not be made by the Appellant as per our order dated 29.02.2024 by 10.03.2024 since letter dated 29.02.2024 could not be responded before the 10.03.2024. Since Section 7 application is pending before the Adjudicating Authority, it is for the Adjudicating Authority to take a call on the submissions and offer made by the Appellant.
The Appellant and the investors as submitted before the Court may deposit the amount of Rs.167 Crores along with 12% interest and Rs.87 Crores plus 12% interest before the NCLT within 10 days as prayed by way of FDR in favour of Registrar, NCLT. If the said deposit is made or not made, the Adjudicating Authority shall take appropriate decision on Section 7 application after hearing both the parties.
There are no reason to keep the Appeals pending - Both the Appeals are disposed of accordingly.
-
2024 (3) TMI 863
Approval of Resolution Plan - Consideration of Resolution Plan from Non-Listed Applicants - Authority of CoC to Modify Invitation for Expression of Interest (EOI) - Interpretation of Regulations 39(1)(b) and 36A of the CIRP Regulations, 2016 - HELD THAT:- The Regulation clearly provides that the committee shall not consider a resolution plan received from an application whose name does not appear in the list of PRAs. Admittedly, neither Patanjali nor other two applications have submitted any EOI nor their name was reflected in the List of PRAs - Regulation 36A which provide for Invitation for Expression of Interest also empowers the CoC to modify the invitation for Expression of Interest. It is always open for the CoC to take a decision to not proceed on the Applications, EOI received and take a decision for issuance of fresh Form G and permit other applicants to participate. When no fresh Form G has been issued, it is not open for any new applicant to submit application before the Adjudicating Authority for being permitted to participate in the CIRP and submit Resolution Plan.
In any view of the matter, affidavit has been filed by the CoC where resolution has been brought on record that the CoC has now decided not to consider any additional new entrants and they will confine their consideration to Resolution Applicants whose names were reflected in the final list of Prospective Resolution Applicants dated 07.11.2023.
The Committee of Creditors having taken resolution not to consider any additional new entrants, we are of the view that impugned order dated 12.02.2024 and 21.02.2024 cannot be sustained. Both the Appeals are allowed.
-
2024 (3) TMI 862
Grant of bail - money laundering - proceeds of crime - scheduled/predicate offences - hatching the criminal conspiracy and conceptualizing the idea of accommodation entries against cash - whether the appellants have been able to satisfy the twin conditions laid down in Section 45 of the PMLA? - HELD THAT:- It is confined to deal with the bare minimum facts necessary for the purpose of deciding whether the appellants have been able to satisfy the twin conditions laid down in Section 45 of the PMLA, that is (i) there are reasonable grounds for believing that the persons accused of the offence under the PMLA is not guilty of such offence; and (ii) that he is not likely to commit any offence while on bail.
In GAUTAM KUNDU VERSUS MANOJ KUMAR, ASSISTANT DIRECTOR, EASTERN REGION, DIRECTORATE OF ENFORCEMENT (PREVENTION OF MONEY LAUNDERING ACT) GOVT. OF INDIA [2015 (12) TMI 1133 - SUPREME COURT], while holding that the conditions specified under Section 45 of PMLA are mandatory, it was observed the conditions enumerated in Section 45 of PMLA will have to be complied with even in respect of an application for bail made under Section 439 CrPC. That coupled with the provisions of Section 24 provides that unless the contrary is proved, the authority or the Court shall presume that proceeds of crime are involved in money-laundering and the burden to prove that the proceeds of crime are not involved, lies on the appellant.
The offence of money laundering as contemplated in Section 3 of the PMLA has been elaborately dealt with by the three Judge Bench in VIJAY MADANLAL CHOUDHARY & ORS. VERSUS UNION OF INDIA & ORS. [2022 (7) TMI 1316 - SUPREME COURT], in which it has been observed that Section 3 has a wider reach. The offence as defined captures every process and activity in dealing with the proceeds of crime, directly or indirectly, and is not limited to the happening of the final act of integration of tainted property in the formal economy to constitute an act of money laundering. Of course, the authority of the Authorised Officer under the Act to prosecute any person for the offence of money laundering gets triggered only if there exists proceeds of crime within the meaning of Section 2(1)(u) of the Act and further it is involved in any process or activity - The property must qualify the definition of “Proceeds of Crime” under Section 2(1)(u) of the Act. As observed, in all or whole of the crime property linked to scheduled offence need not be regarded as proceeds of crime, but all properties qualifying the definition of “Proceeds of Crime” under Section 2(1)(u) will necessarily be the crime properties.
In the instant case, it has been found during the course of investigation from the statements of witnesses recorded under Section 50 that the appellant Satyendar Jain and his family directly or indirectly were owning/controlling the companies - M/s. Akinchan Developers Pvt. Ltd., M/s. Paryas Infosolution Pvt. Ltd., M/s. Indo Metalimpex Pvt. Ltd. and M/s. Mangalayatan Projects Pvt. Ltd. He was the conceptualizer, initiator and supervisor of the accommodation entries totalling to Rs.4.81 Crores approximately, which were received from the Kolkata based entry operators in the Bank accounts of the said four companies - also, the witnesses had clearly stated that Satyendar Kumar Jain was the conceptualizer, initiator, fund provider and supervisor for the entire operation to procure the accommodation, share capital/premium entries. Though, the shareholding patterns of the said four companies are quite intricate, they do show that Mr. Satyendar Kumar Jain through his family was controlling the said companies directly or indirectly and that Mr. Satyendar Kumar Jain was the “beneficial owner” within the definition of Section 2(1) (fa) of PMLA.
There remains no shadow of doubt that the appellant- Satyendar Kumar Jain had conceptualized idea of accommodation entries against cash and was responsible for the accommodation entries totalling to Rs. 4.81 crores (approx.) received through the Kolkata based entry operators in the bank accounts of the four companies i.e. M/s. Akinchan Developers Pvt. Ltd., M/s. Paryas Infosolution Pvt. Ltd., M/s. Indo Metalimpex Pvt. Ltd. and M/s. Mangalayatan Projects Pvt. Ltd., by paying cash and the said companies were controlled and owned by him and his family. Though it is true that a company is a separate legal entity from its shareholders and directors, the lifting of corporate veil is permissible when such corporate structures have been used for committing fraud or economic offences or have been used as a facade or a sham for carrying out illegal activities.
The appellants have miserably failed to satisfy us that there are reasonable grounds for believing that they are not guilty of the alleged offences. On the contrary, there is sufficient material collected by the respondent-ED to show that they are prima facie guilty of the alleged offences - it is not possible to hold that appellants had complied with the twin mandatory conditions laid down in Section 45 of PMLA. The High Court also in the impugned judgment after discussing the material on record had prima facie found the appellants guilty of the alleged offences under the PMLA, which judgment does not suffer from any illegality or infirmity.
Appeal dismissed.
-
2024 (3) TMI 861
Money Laundering - Validity of framing of charges - dealing in skin and organs of prohibited animals - proceeds of crime - scheduled offence - It is submitted that the trial court has failed to consider that in fact no proceeds of crime has been generated from the goods allegedly seized from the premises of the applicants - HELD THAT:- The allegations against the applicants are to tune that they were indulged in dealing with the skin and organs of prohibited animals from before the year 2007 and the same is punishable under various provisions of the Wildlife Act and the Indian Forest Act. It is also alleged that applicants have parked proceeds of crime earned by them in the bank-account of their mother, which has been used by her in purchasing two properties. Sudden inflation in income tax returns of Smt. Zaibunnisha is also highlighted in order to substantiate the allegations of money laundering. It is also the case of the Enforcement Directorate that these properties were earned after enactment of PMLA.
The whole case of the applicants rests on presumption that the valuation of the certain articles seized from the houses of applicants has not been properly done and as per the definition of property contained in section 2(y) of the PMLA, the offence, if is committed, pertaining to the value of more than 30 Lakh, the applicants only in that condition may be prosecuted under PMLA, and at the relevant time, the offence under Wildlife Act was falling under Chapter ‘B’ of Schedule appended with PMLA.
Much emphasis has been given on the fact that the valuation of the seized articles is based on a website run by an NGO. However, allegations are also to tune that apart from seized articles the proceeds of crime has also been used for purchase of some properties by mother of the applicants. Thus, it is not the seized articles alone whose valuation is to be seen. Moreover, when there is no known mode of assessing the value of seized articles as they could not be sold in open market legally, the value of these articles may be what these articles may fetch anywhere may be taken as the market value of the same and it is why the emphasis has been given in section 2(zb) on market value - The applicants have not declared in their application as to on what basis they are claiming the value of proceeds of crime less than 30 Lakh. Thus, what is the market value of the articles seized from the premises of the applicants is a disputed question of fact which could only be adjudicated by the trial court, during the course of trial.
Similarly, if the income tax returns filed by the mother of the applicants has not been disputed, the same may not be the sole ground of the discharge of applicants. Law leans in favour of trial and an accused could only be discharged if there is no prima facie case available against him. At the stage of discharge or framing of charge the trial court was only required to sift the material sent with the complaint in order to assess whether there is a prima facie case against the applicants and meticulous exercise of appreciating evidence or material, in order to assess the probative value of the evidence collected by the prosecution, was not required.
This application moved by the applicants under section 482 CrPC is dismissed.
-
2024 (3) TMI 860
Levy of service tax - Business Auxiliary service or not - commission on sale of liquor - it was held by Appellate Tribunal that the transaction of purchase and sale of liquor by the Corporation will not fall within the ambit of BAS and would, therefore, not be taxable - HELD THAT:- Following the order dated 16.07.2018 passed by a coordinate Bench of this Court in respect of the very same assessee in THE COMMISSIONER OF CENTRAL EXCISE JAIPUR I VERSUS RAJASTHAN STATE BEVERAGES CORPORATION LTD. [2018 (7) TMI 1057 - SC ORDER] and on the same questions which arise in the aforesaid cases, this appeal is also dismissed.
-
2024 (3) TMI 859
Levy of Service tax - Business auxiliary service - commission retained/earned towards the service rendered by them to the co-GSA/IATA - extended period of limitation - HELD THAT:- On going through the explanation given under Section 65(19) commission agent means a person who acts on behalf of as a person and causes sale or purchase of goods, provision or receipt of services, for a consideration and includes any person who does some of the things, while acting on behalf of another person. It is alleged that the appellants are commission agents for their co-operators and are earning commission for the same and therefore they are rendering business auxiliary service to their co-operators. However, the practice of the trade, if observed closely, would indicate that the appellants are buying tickets on behalf of their customers/clients and not definitely on behalf of their co-operators.
The entire surmise in the show cause notice is ill conceived. The relation between the appellant and the co-operators appears to be one of the principal-to-principal basis. If at all the appellants are presumed to be acting on behalf of somebody else for a commission, it is their customers/clients for whom they are buying tickets from other GSA/IATA operators. However, this is not the allegation in the show cause notice. Therefore, there are no principal and agent relationship between the other GSA/IATA operators and the appellants.
Tribunal had an occasion to deliberate on the very same issue wherein Tribunal came to the conclusion that purchase and sale tickets for a commission between two agents operating under GSA/IATA does not amount to rendering any service exigible to service tax. Tribunal in the case of C.S.T., SERVICE TAX- AHMEDABAD VERSUS M/S OM AIR TRAVELS PVT. LTD. [2019 (6) TMI 1022 - CESTAT AHMEDABAD] held that In the fact that the appellant is purchasing the ticket on discounted price and selling the same at higher price to the customer, the difference, in our view, is a trade margin during the process of sale and purchase of the tickets. Therefore, we do agree with the contention given by the Ld. Commissioner (Appeals). Accordingly, the demand raised on trade margin of purchase and sale of the tickets shall not be taxable.
Invocation of Extended period of Limitation - HELD THAT:- There is considerable force in the arguments of the Ld. counsel for the appellants; revenue did not bring about any evidence to allege suppression etc. with intent to evade payment of service tax; moreover, it is found that when regular audits were conducted, revenue having raised the issue in subsequent audits, cannot take recourse to invoke extended period.
The inevitable conclusion one can draw is that the appellants are not rendering any “Business Auxiliary Service” to the other GSA/IATA operators and therefore the commission earned by them is not exigible to service tax as proposed in the show cause notice and confirmed in the impugned order. Therefore, the impugned order is not legally sustainable and is liable to be set aside - Appeal allowed.
-
2024 (3) TMI 858
Exemption from service tax - rent-a-cab service - State Transport Undertaking - reverse charge mechanism - Extended period of limitation - HELD THAT:- The issue is no more res integra. In BANGALORE METROPOLITAN TRANSPORT CORPORATION VERSUS COMMISSIONER OF SERVICE TAX [2015 (2) TMI 100 - CESTAT BANGALORE] it has been held at the business undertaken by BMTC is to provide bus facility /transport facility to the citizens of Bangalore city and main activity is that running the buses in the city for convenience of the citizens and thus it cannot be called as a rent-a-cab service operation. The definition of cab under section 65 (20) of Finance Act, 1994 of maxicab under section 65 (70) of Finance Act read with Section 2 (22) of Motor Vehicle Act and of rent-a cab scheme operator defined under section 65 (91) along with the meaning of taxable service in relation to renting of cabs given under section 65 (105)(a) of the Finance Act, 1944 have been examined by the Tribunal in BMTC case. The Tribunal has held that definition itself excludes State Transport Undertakings (Bangalore’s BMTC in said case) from the category of service providers.
Though in the present case the appellant is alleged to be the recipient of rent-a- cab service and is held liable under reverse charge mechanism (RCM) it is observed that Notification No. 25/2012 dated 20.6.2012 exempts State Transport Undertaking from any tax liability. The decision of Maulana Azad is well applicable to present case - appellant is not liable to service tax for receiving buses and taxis on hire. The appellant cannot be made liable to tax not even under RCM for receiving legal consultancy services.
Extended period of limitation - HELD THAT:- There is no evidence found on record proving such intent / mensrea with the appellant to evade payment of service tax. The appellant have already been held not liable to pay the amount confirmed. Resultantly, it is held that the department has wrongly invoked the extended period of limitation while issuing Show Cause Notice.
There is no rational in confirming the impugned demand even under reverse charge mechanism - the demand on both the counts is wrongly being confirmed by the adjudicating authority below. Hence the order under challenge (Order-in-Original) is hereby set aside - appeal allowed.
-
2024 (3) TMI 857
Failure to pay appropriate tax - Revenue from Programme and Advertising Service - quantum of service tax paid by them was not commensurate with the income accounted in the books of accounts - demand alongwith penalty - HELD THAT:- The dispute arose due to the lack of submission of data in a timely manner and a proper explanation of facts in correlation with the law, by the Appellant. Now that the Appellant is ready to present the data which as per their calculation leaves a very small amount of duty to be paid, it would serve the ends of justice if the same is verified and then examined in connection with the law and Boards Circulars referred to by the Appellant. The matter hence merits to be examined afresh.
The impugned order set aside - matter remanded back to the original authority for de novo adjudication - appeal disposed off.
-
2024 (3) TMI 856
Exemption for export promotion under N/N. 18/2009-ST dated 01.07.2009 - seeking relief of taxes paid on the services used in manufacture of export products - failure to submit the relevant documents showing the payment of commission to their foreign commission agents - HELD THAT:- The Hon’ble Apex Court in a Constitution Bench judgment in S. AMARJIT SINGH KALRA (DEAD) BY L. RS. & ORS. VERSUS PRAMOD GUPTA (DEAD) BY L. RS. & ORS. [2002 (12) TMI 607 - SUPREME COURT] observed Laws of procedure are meant to regulate effectively, assist and aid the object of doing substantial and real justice and not to foreclose even an adjudication on merits of substantial rights of citizen under personal, property and other laws. Procedure has always been viewed as the handmaid of justice and not meant to hamper the cause of justice or sanctify miscarriage of justice.
It is not disputed that there has been a delay in filing the EXP-2 Return the reason for which has been explained by the Appellant. This delay is not shown to cause any prejudicial consequence for Revenue. However, the Appellant had furnished material which shows a substantial compliance with the requirements of the exemption notification - While determining whether a provision is mandatory or directory, in addition to the language used in the notification, the context in which the provision is used and the purpose it seeks to achieve should also be examined. A beneficial legislation should not be viewed very rigidly. It is noted that there were no allegations of any blame worthy act by the Appellant. The claim should hence have been scrutinized and the Appellant allowed to satisfy whatever doubts that the Original Authority had. In the circumstances, the substantial rights of the appellant should not have been denied on procedural grounds.
An order imposing a penalty involves an exercise of judicial discretion, which requires the decision to be fair, reasonable and objective. On the obverse side, anything arbitrary and whimsical would not satisfy the said requirement. This action of the Lower Authority has surprisingly found no comment in the impugned order and is defective to that extent. A simple act of claiming a tax benefit cannot be at the pain of being held liable for penalty. Such an order cannot be allowed to survive - there are no hesitation in not only quashing the penalty but also in setting aside the order.
Matter remanded back to the Original Authority for de novo adjudication on merits of the Appellants claim for duty exemption as per Notification 18/2009 Service Tax, dated 07/07/2009 only - appeal disposed off.
-
2024 (3) TMI 855
Taxable service or not - services received by appellants from M/s Hoshizaki Europe BV - post negative list regime, with effect from 01.07.2012 - services can be treated as “Business Auxiliary Service” as per the definition given in Section 65(19) of the Finance Act, 1994 during pre-negative list period or not - ‘intermediary services’ for the purposes of Place of Provision of Services Rules, 2012 (POPS) - supply of bought out material as “free supplies” by the appellants to the service provider of construction of their factory building - extended period of limitation - penalty under Section 78 of the Finance Act, 1994 - period commencing from April, 2014 to September, 2015.
HELD THAT:- It transpires that for the period relating to the pre-negative list regime i.e., prior to 01.07.2012, the taxability was determined in terms of coverage of an activity under the service tax net to be defined as ‘taxable service’ under Section 65(105) ibid, which enumerated each of the specified services. For the period postnegative list regime, the category of services hitherto defined under the erstwhile regime were merged under a common phrase i.e., ‘service’ as defined under Section 65B(44) ibid, which was brought into effect from 01.07.2012. In the present case, the disputed transactions have been undertaken during April, 2014 to September, 2015. Hence, there is no legal basis on which the services rendered in marketing and sales promotion could be examined with respect to definition of ‘Business Auxiliary Services’ that existed in the past i.e., prior to 01.07.2012 - Further, 65B(55) ibid does not provide for the words and expressions used prior to 01.07.2012 to be made applicable in respect of Chapter V of the Finance Act, 1994 for the purpose of service tax. Hence, the findings at para 8 of the impugned order does not have any legal basis, and thus on this basis itself the demand of service tax on marketing and sales promotion service received by the appellants on RCM basis, is liable to be set aside.
The nature and value of the services provided are known to both parties i.e., the service provider and a service receiver. We also find that the consideration charged by Hoshizaki Europe is independent of the consideration received by the appellants in respect of the goods supplied by them to overseas customers. Thus the principle of separation of value, is also fulfilled in the present case. The main transaction between the appellants and the customers situated abroad, is the sale of goods manufactured by the appellants; and this is distinct and is completely different from the services provided by Hoshizaki Europe BV. Thus, all the three criteria laid down by the CBIC’s clarification is fulfilled in the present case to categorize the disputed services, as ‘intermediary services’.
Thus, in terms of specific Rule of the POPS which would more appropriately apply in this case, it is found that Rule 9 of POPS is applicable to the ‘intermediary service’ as it is the more appropriate rule for determination of place of provision of the service - the place of provision of service in the present case would be the location of the service provider i.e., Dubai. Hence, in respect of ‘intermediary services’ provided by the service provider from Dubai to the appellants in India, would not be exigible to service tax under Section 66B ibid.
Service tax levy on free supplies under the works contracts transaction - HELD THAT:- The Larger Bench of this Tribunal in case of COMMISSIONER OF SERVICE TAX ETC. VERSUS M/S. BHAYANA BUILDERS (P) LTD. ETC. [2018 (2) TMI 1325 - SUPREME COURT] having similar set of facts of the case, had concluded that the value of goods and materials supplied free of cost by a service recipient to the provider of taxable construction service, would be outside the taxable value or the gross amount charged in terms of Section 67 ibid.
Extended period of limitation - HELD THAT:- This Tribunal in the case of RELIANCE INDUSTRIES LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE & SERVICE TAX, LTU, MUMBAI [2016 (6) TMI 1108 - CESTAT MUMBAI] had decided the issue on the basis various judgements where it was held that In the instant case also if any tax was payable it could have been available immediately to the Appellant, thereby rendering the entire dispute being revenue neutral. This being the case the invocation of extended period of limitation is clearly not justified - the issue of invoking extended period of time for demand of service is answered in favour of the appellants.
There are no strong grounds to hold that the services received by the appellants from Hoshizaki Europe BV from its Dubai office for marketing and sales promotion services are liable for payment of service tax. Further, the value of goods and materials supplied free of cost by the appellants to the service provider of taxable construction service, would be outside the taxable value or the gross amount charged in terms of Section 67 ibid. Consequently the demands of service tax and imposition of penalties confirmed in the impugned order is not legally sustainable.
The adjudged demands confirmed on the appellants in the impugned order dated 14.02.2018 is liable to be set aside - Appeal allowed.
............
|
9911796707
