Newsletter: Where Service Meets Reader Approval.
TMI Tax Updates - e-Newsletter
December 24, 2016
Case Laws in this Newsletter:
Income Tax
Customs
Corporate Laws
Service Tax
Central Excise
CST, VAT & Sales Tax
Indian Laws
Articles
News
Notifications
Highlights / Catch Notes
Income Tax
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Assessment u/s 153A - assessee has not challenged the authority of the jurisdiction fairly for a period of more than two years and it is only after the notice U/s.153-A issued, this writ petition has been filed - petition dismissed - HC
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Penalty u/s 271(1)(c) - unexplained cash deposits - the explanation offered by the assessee is not bonafide and the said explanation was rightly rejected by the authorities below. - AT
Customs
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Enhancement of value of imports - Every second hand goods varies from each other depending upon the duration of use, manner of use and condition of the machine therefore price of one second hand goods cannot be applied to other second hand goods without ascertaining the physical parameter of both the machine - AT
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Mis-declaration of value of imported goods - Since the appellants deliberately suppressed the value by mis-declaring, the goods were liable for confiscation. - AT
Corporate Law
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NCLT has jurisdiction to deal with the transferred matter filed under Sections 163 & 219 of the old Act - Tri
Central Excise
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Refund claim - the manufacturer did not claim exemption, whereas the appellant, the customer claims refund on the basis of exemption notification - Where the exemption was conditional one, buyer cannot claim refund on the pretext of exemption - AT
Case Laws:
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Income Tax
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2016 (12) TMI 1200
Reopening of assessment - Addition on Interest on bank accounts in UK and loan given - Held that:- No doubt, the letters received from the UK authorities were sufficient to trigger a reassessment proceedings but exactly that is where the Revenue, in our opinion, faltered. Having received information, it could well have proceeded through a reassessment proceeding at the earliest opportunity, i.e. in October 1989 or latest by December of that year, the revenue chose to wait for three years and sought to reopen at least a decade-late completed assessment. By then the assessee had died. There are certainly pointers to interesting omissions and in any event, leads that could have been developed by the AO, such as queries to the Bank of India, for foreign inward remittances and their source. If the assessee were alive, upon receipt of such information, he might well have been confronted with them. The lack of any probe in this regard and almost exclusive reliance upon the UK revenue information, in our opinion, was not sufficient to conclude that the amount which was attributed to the deceased assessee, i.e. UK £2 million in fact belonged to him. In fact, the materials show that these amounts were brought to tax in the hands of Sh. Kumar. Rather than accepting what ought to be the correct standard, this Court is of the opinion that the tax authorities did not do what they could have and had not done what they should have when they did get information in September 1989 and woke-up far too late. For these reasons, we are of the opinion that the question of law framed should be answered against the revenue and in favor of the assessee.
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2016 (12) TMI 1199
Stay of demand - Held that:- Considering the fact that with respect to earlier assessment years, on the very issue, when the assessee had succeeded at the first appellate stage [and according to the petitioner assessee upto the High Court], we are of the opinion that the office memorandum dated 29th February 2016 shall not be applicable to the facts of the present case. Considering the aforesaid facts and circumstances, the learned Principal Commissioner of Income-tax ought to have granted unconditional stay of the demand during pendency and final disposal of the appeal before CIT [A]. In view of the above and for the reasons aforestated, the present petition succeeds. The impugned order passed by the learned Principal Commissioner of Income-tax directing the petitionerassessee to deposit 15% of the demand and on such deposit, to stay further demand during the pendency of the appeal before the learned CIT [A], is hereby quashed and set-aside.
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2016 (12) TMI 1198
Reopening of assessment - entitlement to exemptions under Section 11 [1] - Held that:- It appears that according to the Assessing Officer, activities of the assessee cannot be said to be for charitable purpose, as defined in Section 2 (15) of the Act, as by charging fees from the members for effluent treatment, the activities can be said to be commercial activities. However, it is required to be noted that during the scrutiny assessment, the assessee produced all necessary materials asked by the Assessing Officer, more particularly, the list of persons from whom the assessee received donation and contribution from members for effluent treatment and it was only thereafter that the Assessing Officer finalized scrutiny assessment. Thus, it cannot be said that there was any failure on the part of petitioner-assessee in not disclosing true and correct facts necessary for assessment. It is required to be noted that even in the reasons recorded, there is no allegation whatsoever that the assessee has failed to disclose true and correct facts necessary for the assessment. Under the circumstances and considering the decision in case of CIT v. Kelvinator of India Limited [2010 (1) TMI 11 - SUPREME COURT OF INDIA], the impugned Notice under Section 148 of the Act to reopen the assessment for AY 2009-2010, issued beyond four years, cannot be sustained and the same deserves to be quashed and set-aside on the aforesaid ground alone. - Decided in favour of assessee.
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2016 (12) TMI 1197
Validity of reopening of assessment - audit objections raised by the audit party relied upon - Held that:- On considering the audit objections raised by the audit party and the reasons recorded to reopen the assessable it appears that on the same ground on which the audit party raised the objection, the assessment for AY 200607 is sought to be reopened Assessee is justified in submitting that the Assessing Officer on the date of issuance of the notice under Section 148 of the IT Act could not have formed a belief that any income has escaped the assessment. Under the circumstances, on the aforesaid ground alone i.e. on the ground that the impugned reassessment proceedings are initiated solely on the audit objections raised by the audit party to which the Assessing Officer was not agreeable, the impugned reassessment proceedings deserves to be quashed and set aside. - Decided in favour of assessee
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2016 (12) TMI 1196
Reopening of assessment - registration under Section 12A(a) withdrawn retrospectively with effect from 01.04.2002 - Held that:- Considering the fact that at the relevant time and during the years under consideration the registration under Section 12A(a) of the I.T. Act in favour of the petitioner – assessee was in force and in existence and accordingly the assessee claimed the deduction under Section 11 of the IT Act, which came to be granted / allowed by the Assessing Officer. Therefore it cannot be said that there was any failure on the part of the assessee in not disclosing the true and correct facts necessary for assessment. Under the circumstances, the condition precedent to assume the jurisdiction to reopen the assessment under Section 147 of the IT Act beyond the period of 4 years are not satisfied. Under the circumstances, on the aforesaid ground alone, the impugned / assessment proceedings which are beyond the period of 4 years deserve to be quashed and set aside. - Decided in favour of assessee
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2016 (12) TMI 1195
Assessment u/s 153A validity - Held that:- The matter pertains to factual determination of the issue and as such this Court cannot assume the power of appellate court, moreover, it is not that there is no other efficacious alternative remedy available to the petitioner – assessee, ground on which the jurisdiction of this Court under Article 226 of the Constitution of India is to be invoked, taking into consideration the fact that there is availability of alternative remedy of appeal, we thought it proper not to interfere with the issue since only notice U/s.153-A has been issued to the petitioner with a direction to satisfy the authority, moreover, the search and seizure was conducted on 11.09.2014, well within the knowledge of the petitioner – assessee, but he has not challenged the authority of the jurisdiction under the Act fairly for a period of more than two years and it is only after the notice U/s.153-A of the Act, 1961 issued, this writ petition has been filed. Hence we are of the considered view that this is not the appropriate stage to entertain the writ petition for the reasons discussed herein above. Accordingly the writ petition is dismissed, however reserving liberty to the petitioners that if they chose to avail the alternative remedy of appeal, they may avail the same by raising all points which are available to them and in that situation the authority concerned will take decision in accordance with law.
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2016 (12) TMI 1194
Disallowance of depreciation on plant and machinery - Held that:- Having heard and considering the fact that in the earlier orders with respect to the very plant and machinery learned tribunal set aside the order passed by the Assessing Officer in making disallowance of depreciation on plant and machinery and nothing is on record that with respect to the said orders any contrary decision is taken i.e. whether the assessee in fact did not make use of the plant and machinery, when in the subsequent year 2009-10 the learned tribunal has set aside the order passed by the Assessing Officer in making disallowance of depreciation on plant and machinery, it cannot be said that the learned tribunal has committed any error, which calls for the interference of this Court in appellate jurisdiction. As such, no substantial question of law arise in the present Tax Appeal. - Decided in favour of assessee.
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2016 (12) TMI 1193
Recovery of tax dues - Public auction of attached property - auction notice published in two newspapers - Held that:- Making a publication in three Dailies, two in Vernacular and one in English cannot be said to be irregular in terms of Rule 54. It is purely within the discretion of the Recovery Officer to effect publication depending upon the nature of property involved. As far as the expense for publication is concerned, statute clearly provides that the defaulter is under obligation to pay all expenses regarding such publication, in terms of Rule 5 of the Second Schedule. Under such circumstances, we find anything wrong in the demand made pursuant to Ext.P12. Learned counsel for the petitioner seeks for a week's time to pay the said amount.It is made clear that on payment of the said amount, the attachment shall be vacated. Once the attachment is vacated, necessary intimation in that regard shall be given by the Department to the Sub Registrar concerned.
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2016 (12) TMI 1192
Income by way of slot chartering - whether would from a part of income from operations of ships exempt under Article 9 of the DTAA - Held that:- Revenue has not disputed the fact that the activity carried out with regard to the four cases has nexus with the operation of ships in international traffic. The Revenue also does not dispute that the receipt attributable to the four cases is less than 0.5% of total receipts. Thus it would undisputedly satisfy the nexus test laid down by this Court in Balaji Shipping (2012 (8) TMI 681 - BOMBAY HIGH COURT). Therefore, the assessee would be entitled to the benefit of Article 9 of IndiaDenmark DTAA. In any case, the grievance of the Revenue is not sustainable as the impugned order on appreciation of evidence has held that particulars of receipts in respect of the four cases were filed with the return of income. Therefore, the view taken by the Tribunal is a possible view. Nothing has been shown to us which would indicate that the view taken by the Tribunal is not covered by the nexus test laid down by this Court in Balaji Shipping (supra).
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2016 (12) TMI 1191
Treatment of interest income on fixed deposits while computing the deduction u/s.10A - Held that:- Jurisdictional High Court in the case of M/s.India Comnet International Vs. ITO in [2007 (7) TMI 233 - MADRAS HIGH COURT] wherein held that interest received on export profit deposited with bank does not qualify for relief u/s.10A of the Act. Further, the Delhi High Court in the case of M/s.Thomson Press (INDIA) Ltd. Vs. CIT in [2015 (10) TMI 756 - DELHI HIGH COURT] wherein held that the interest cannot be considered as profit and gain derived by assessee from the eligible undertaking as it does not bear a direct nexus with the activities of the eligible undertaking only, the profit and gains of assessee which has direct nexus with the undertaking to which S.10A apply, interest would be excluded from the income of assessee. Interest income earned by the assessee from the bank deposits cannot be included as profit and gain from eligible undertaking so as to grant deduction u/s.10A of the Act and it is to be excluded from profit and gains of the business undertaking. - Decided against assessee
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2016 (12) TMI 1190
Disallowance of expenditure u/s. 40(a)(ia) - Held that:- We dismiss the plea of the assessee that provisions of section 40(a)(ia) of the Act cannot be made applicable in respect of amounts paid before the end of the previous year. However, the assessee had submitted the information before the CIT-A that the payees have duly reflected this subject mentioned receipts in their returns of income and paid taxes thereon. We find that the amendment in section 40(a)(ia) of the Act has been held to be retrospective in operation in the light of the decision in the case of CIT Vs. Ansal Land Mark Township (P) Ltd (2015 (9) TMI 79 - DELHI HIGH COURT ). Respectfully following the said decision, we deem it fit and proper and in the interest of justice and fair play set aside this issue to the file of the AO for examination of subject mentioned receipts in the hands of the respective payees based on details provided to that effect by the assessee. Once, if it is proved to be correct then no disallowance u/s. 40(a)(ia) of the Act would be operative in the hands of the assessee. - Decided in favour of assessee for statistical purposes Income from undisclosed source u/s. 69A - Held that:- We find that the AO added the impugned addition for not disclosing the same in the balance sheet and by observing the same was settled through cheque on 14- 04-2010. Admittedly, the submission as made by the assessee before the CITA that assessee has taken into consideration the gross bill, which was disclosed and offered for taxation, wherein the said impugned amount is part and parcel of said gross bill. The CIT-A found the same as independent and doubted the same is taxed or not. In view of such observations and taking into considerations the submission as advanced by the ld.AR of the assessee, we are of the view that the issue requires fresh examination in terms of the contention of the assessee the gross bill amount have been disclosed and offered the tax or not. Hence, AO is directed to decide this issue afresh in accordance with law, uninfluenced by earlier decision and decision of CIT-A in this regard. - Decided in favour of assessee for statistical purposes
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2016 (12) TMI 1189
Penalty u/s 271(1)(c) - sale of agriculture produce in the mandi - Held that:- AO made the impugned addition for not producing the relevant evidence showing the sale of agriculture produce in the mandi and the CIT-A confirmed the same observing that the Assessee did not produce anything before the AO in support of his claim and the Tribunal held that income declared under the head agriculture is excessive and determined the same by restricting to ₹ 10,00,000/-, therefore, the income on agriculture determined by the Tribunal on the basis of estimation was become final on which the AO imposed penalty. Therefore, it is clear from the addition was made on the basis of estimation. Thus penalty deleted - Decided in favour of assessee
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2016 (12) TMI 1188
Interest earned on deposits - “income from other sources” OR “business income” - Held that:- Undisputedly the assessee has received the grants-in-aid from the Govt. of India and the State Govt. and the assessee has placed the unutilized funds in the Escrow a/c. Since the amounts have been kept in the Escrow a/c, the funds cannot be used for any other purpose and the funds did not belong to the assessee as well. The interest income is not the income of the assessee but only goes to the increase the grantsin- aid and one of the conditions of grants-in-aid is that the unutilized amounts have to be returned to the Govt. along with the interest. Therefore, the interest income derived by the assessee is also the income of the Govt. and not of the assessee and hence it ought to have been allowed to be set off against the pre-operative expenses. The interest earned on funds primarily brought for infusion in the business could not have been classified as income from other sources. Since the income was earned in a period prior to commencement of business it was in the nature of capital receipt and hence was required to be set off against pre-operative expenses. See Indian Oil Panipat Power Consortium Ltd.case [2009 (2) TMI 32 - DELHI HIGH COURT ]
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2016 (12) TMI 1187
Rejection of appeal u/s 249(4)(a) - mandatory deposit of tax before filing of an appeal - plea of the assessee is that the cash seized by the department from the assessee firm is in excess of tax payable on the returned income - Held that:- Considering the view taken by the Tribunal in the connected group of matters, we set aside the order passed by the ld. CIT(A) and direct him to verify as to whether the cash seized during the course of search is sufficient to meet the tax liability for the year under consideration and, if so, he is directed to admit the appeal to consider the issues urged before him on merits. Needless to observe that the additional grounds urged before us are purely legal issues and therefore the CIT(A) would also take these grounds under consideration. Since the matter is set aside, it is not necessary for us to go into the merits of the issues urged before us either on merits.
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2016 (12) TMI 1186
Penalty u/s 271(1)(c) - unexplained cash deposits - Held that:- The assessee could not come forward before the authorities below to explain the source of cash deposit of balance amount of ₹ 9,18,775/- and why the same has not incorporated in the return of income filed with the Revenue. The assessee’s contention that the C.A. of the assessee expired in April, 2006 and the assessee has engaged the services of wife of the deceased C.A., who is not a qualified C.A. hence the error had occurred, could not be accepted as bonafide explanation to take the assessee out of clutches of penal provisions as contained in Section 271(1)(c), as the assessee has more than three years after death of his CA to have arranged his affairs so that true and correct return could be filed with the Revenue which is the obligation of the assessee and the onus is on the assessee to have filed true and correct return of income, as three year period after the death of CA is more than sufficient period available to the assessee to have arranged his affairs. The return of income was filed by the assessee in June, 2009 whereby there was a gap of more than three years when the CA expired on April 2006. Thus the explanation offered by the assessee is not bonafide and the said explanation was rightly rejected by the authorities below. This case is a fit case to impose penalty u/s 271(1)(c) - Decided against assessee
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2016 (12) TMI 1185
Penalty u/s 271(1)(c) - service tax liability - Held that:- Assessing officer has questioned the assessee regarding the service tax liability reflected in the balance sheet. In this connection the assesee had explained that the total service tax credited was ₹ 20,21,750 against which the amount of ₹ 17,08,150 was paid. He further explained that the balance unpaid amount of ₹ 3,04,834 consisted of ₹ 2,35,437 exempted u/s 65 sub-section 27 of service tax and the remaining amount of ₹ 69,397was payable by the Gas Authority of India. We noticed that the assessee had explained his claim and the nature of these transaction with supporting details. We also observed that all the facts were fully disclosed and apparently there was no case of furnishing inaccurate particulars of income by the assessee. We find that in this case assessee had disclosed all the particulars of service tax paid/ payable and detailed of loan transactions carried with related parties. The assessing officer had failed to substantiate his findings with supporting material and evidences to prove that there was concealment of particular of income in the case of assessee. - Decided in favour of assessee.
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Customs
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2016 (12) TMI 1158
Valuation - enhancement of value - Mis-declaration of quantity of goods - import of 46 units of old and used cannon photocopier machines - Held that: - As regard the enhancement of value done by the adjudicating authority, we find that sole basis for enhancement of value is based on the value suggested by DRI which relates to some other investigation. It is also observed that the Adjudicating authority accepted the price suggested by the DRI but did not bother to call for the basic evidence from where the DRI has obtained the price. Therefore price suggested by the DRI should not have been applied for enhancement of the impugned goods. Moreover goods imported is a second hand photocopier. Every second hand goods varies from each other depending upon the duration of use, manner of use and condition of the machine therefore price of one second hand goods cannot be applied to other second hand goods without ascertaining the physical parameter of both the machine - enhancement of the value is arbitrary and without any basis hence the same is not sustainable. As regard the issue of mis-declaration of the quantity of the goods, we find that though in some of the model, quantity declared and the actual quantity are different but total quantity of the photocopier imported and declared by the importer are matching i.e. 46 number of photocopiers. We also find that in the discrepancy of the quantity in one model, it was observed that value declared in both the case is same therefore it cannot be said that appellant has intentionally mis-declared the quantity of goods. The photocopier is capital goods and importable freely therefore there is no violation of provision of policy - the enhancement of value and mis-declaration held by the lower authorities are not sustainable - appeal allowed - decided in favor of appellant.
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2016 (12) TMI 1157
Confiscation and penalty - mis-declaration of value of goods - evasion of duty - import of Pioneer brand automobile speaker - Held that: - reliance placed on the decision of the case of Mytri Enterprises Vs. Commissioner of Customs, Mumbai[2004 (7) TMI 182 - CESTAT, MUMBAI] where the value of same pioneer brand speakers was enhanced on the basis of same quotation of traders of Dubai and prices available on the website - In the present case also same quotation and prices available on websites were relied upon therefore decision of Mytri Enterprises directly applicable to the facts of the present case - it was held in the case that the Custom Officer has rightly rejected the price of speakers imported by the appellant as declared in the Bill of Entry, applying Rule 10A of the Valuation Rules. We are also satisfied that in such an eventuality, the prices which are fixed is based on concurrent findings of facts. From the above judgments it can be observed that products are identical i.e. Pioneer brand speakers, the facts such as product specification, declared price, enhanced price, evidences such as quotation, price available on website etc. are identical therefore aforesaid judgment is directly applicable in the present case. Taking into consideration the overall facts and aforesaid judgment, we are of the view that lower authorities have rightly enhanced the value and confirmed the differential duty. Since the appellants deliberately suppressed the value by mis-declaring, the goods were liable for confiscation. Though the redemption fine was not imposed, for purpose of imposition of penalty, availability of the goods which was liable for confiscation is not necessary, therefore penalty was rightly imposed in lieu of confiscation. Since differential duty rightly confirmed under proviso to Section 28 (1) of the Customs Act, penalty imposed under Section 114A is inevitable. As per our above discussion and the settled legal position, the impugned orders are upheld and appeals are dismissed. Appeal No. C/1349/05 - appeal of Star Audio - stands abated for the reason of demise of proprietor of the said firm.
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2016 (12) TMI 1156
Revocation of CHA licence - forfeiture of security deposit - Regulation 19 (1) of CBLR, 2013 - Time limitation - The Ld. Counsel emphatically argued the case on limitation i.e. right from initiation of the proceedings till the passing of order of revocation of CB Licence of the Appellant, the department has not complied with the condition of the time limit prescribed not only for stage wise time limitation but also for over all time limit of 9 months for revocation of CB License. Therefore, the impugned order is not sustainable only on time limit without going into the merit of the case. Therefore we take up the case for decision on limitation. Held that: - it can be seen that the offence report was received by the office of the Commissioner on 05.07.2013 - The inquiry officer filed his report on 23.04.2015 i.e almost after 200 days from the date of Notice date 04.10.2013.It is observed that the inquiry officer not only defied the time line prescribed in the regulation but also disobeyed the direction given by the Commissioner to the inquiry officer. The Ld. Commissioner passed the order for revocation of the CB licence on 02.07.2015. The overall period prescribed for the entire proceeding is 9 months or 270 days from the date of receipt of offence report. As the facts discussed above the total period taken for entire proceeding till the date of passing of order is 728 days. The order for revocation was passed beyond the prescribed time limit of 270 days. Therefore the order is not maintainable on limitation itself. As regard the debate that whether the time line prescribed under the regulation is directory or mandatory, we are of the view that in the circumstances that the specific time limit prescribed under the regulation and no power for condoning the delay was provided, the time line prescribe in mandatory. It is a strite law that in a particular act if specific time limit is prescribed for any action to be taken under such law that will prevail even over the provision of limitation Act. The CHALR/CBLR, 2013 have been enacted under the Custom Act 1962. Under no circumstances time limit prescribed under any statutory provision can be relaxed. Therefore the commissioner was bound to insure that the entire preceding should have been completed within overall stipulated 270 days, which the adjudication authority failed to comply. Therefore the order of revocation passed after stipulated period of 270 days from the date of receipt of offence report cannot sustain. Since we decide this appeal on the ground of limitation itself, it is not necessary to address other issues such as merit of the case, quantum of punishment etc. - we are of the view that the impugned order is not sustainable on the ground of limitation. The impugned order is set aside - appeal allowed - decided in favor of appellant-assessee
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2016 (12) TMI 1155
Rejection of refund claim - SAD - N/N.102/07-Cus dated 14.09.2007 - rejection on the ground that violation of actual user condition - Held that: - Notification does to debar the sale of the imported goods if the same are imported under the actual user condition. If the Revenue is of the view that actual user condition stand violated by the assessee, they were within their rights to initiate action against the assesse for violation of the said condition - appeal rejected - decided against Revenue.
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2016 (12) TMI 1154
Irregular importation of marble slabs - mis-declaration of value - redemption fine - penalty - Held that: - The adjudicating authority has redetermined the value and importer appellant has discharged the customs duty accordingly - the imported consignment of marble is liable for confiscation under Section 111(d) of Customs Act, 1962 due to misdeclaration of the value. Redemption fine - redemption fine of ₹ 16 lakhs as against the value of ₹ 47,21,686/-, is excessive as normally when the redetermination of value is accepted and customs duty liability is discharged if there is no allegation that there was misdeclaration of quantity, tribunal has been taking a consistent view that the redemption fine should be 20% of the enhanced/combined CIF value - the redemption fine reduced to ₹ 10 lakhs. As regards penalty, we hold that penalty imposed by the adjudicating authority of ₹ 10 lakhs is excessive and accordingly, we reduce the same to ₹ 5,00,000/-. Appeal disposed off - decided partly in favor of appellant.
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2016 (12) TMI 1153
Demand of duty with interest and penalty u/s 112(a) of the Customs Act, 1962 - import of goods based on value based advance licences - demand raised on the ground that manufacturer, has availed the benefit of modvat/cenvat credit - Held that: - In our considered view, the impugned order is unsustainable for the reason that it does not bring forth any evidence to indicate that the original manufacturer licence holder and exporter had availed modvat credit on the inputs purchased by them. In the absence of any such evidence the allegation in the show-cause notice that the imported goods against such advance licence are liable to customs duty is unacceptable; secondly, we find that the appellant is a transferee of the licence. It is beyond any stretch of imagination to hold that the appellant should have, during the relevant period, ascertained that the manufacturer exporter had not availed the modvat credit on the inputs. Reliance placed in the case of CJ Shah & Co. Versus Commissioner of Customs (EP) , Mumbai [2016 (11) TMI 1322 - CESTAT MUMBAI], where similar issue decided and it was held that the appellant had purchased the advance licenses from the manufacturer exporter and hence, asking the appellant to evidence that original manufacturer exporter had not availed the modvat credit, is a far fetched proposition well neigh impossible act. Impugned order is set aside and the appeal is allowed - decided in favor of appellant.
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2016 (12) TMI 1152
Seizure - arms and ammunition - Redemption fine - Penalty - Held that: - I find that the Bill of Entry was filed on 29.4.2006 for the LMS Pressed Bundle Scrap from Hodeidah Port, Yeman and received under invoice dated 10.4.2006; the said invoice along with the packing list was accompanied by a pre-shipment inspection certificate from the Registered Inspecting Authorities; on 100% examination, the description of the goods as declared was found to be correct except that they were not in shredded form - It can be seen from the clause 2.32 of the Handbook of Procedure (Vol-I) that it gives a window of two months for importing the goods subject to the condition that pre-shipment inspection certificate is accompanied the goods - also, there are no arms and ammunition found in the said scrap which has been imported - Appeal allowed.
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2016 (12) TMI 1151
Imposition of redemption fine and penalties - clandestine removal - whether the imposition of redemption fine of ₹ 2 lakhs is legal for the reason that the goods are not available for confiscation? - Held that: - reliance placed on the decision of the case of Dev Anand Agarwal Versus CC, New Delhi [2016 (3) TMI 513 - CESTAT NEW DELHI], where it was held that no redemption fine can be imposed when the goods are not available for confiscation - imposition of redemption fine of ₹ 2 lakhs is not within the provisions of law and therefore is set aside. Whether the penalty of ₹ 1,10,000/- imposed on M/s. EPVL and ₹ 50,000/- imposed on Shri Aman Garg are sustainable? - Held that: - the acts committed by the appellants with regard to removal of logs, it has to be stated that there is some amount of intention to remove the logs without seeking permission and against the law applicable to the situation of bonded warehouse. The act of the appellants in bringing wood cutting machine and generator to the premises in order to tamper with the logs and cutting them into pieces before the inspection by the Customs officers has to be viewed seriously - penalty of ₹ 1,10,000/- imposed on M/s. EPVL is sustained - the penalty of ₹ 50,000/- imposed on Shri Aman Garg, is on the higher side. Thus, the imposition of penalty of ₹ 20,000/- on Shri Aman Garg would meet the ends of justice. Appeal partly allowed - decided partly in favor of appellant.
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Corporate Laws
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2016 (12) TMI 1148
NCLT jurisdiction to deal with the cases filed under Section 163 & 219 of the old Act - jurisdiction conferred upon CLB under Section 163 & 219 of the old Act has now been omitted under the corresponding Sections 94 & 136 in the Companies Act 2013 - Held that:- Gazette Notification dated 01.06.2016 say that the Central Government, by invoking Section 434(1)(a) of the new Act, has stated that all matters of CLB shall stand transferred to the National Company Law Tribunal and it shall dispose of such matters or proceedings or cases in accordance with the provisions of the Companies Act, 2013 or the Companies Act, 1956. NCLT has jurisdiction to deal with the transferred matter filed under Sections 163 & 219 of the old Act, therefore, the point raised by the Petitioner saying NCLT has no jurisdiction to decide the cases filed under Sections 163 & 219 before CLB and transferred under Section 434 of the new Act has no merit, therefore this Bench has decided the issue of the maintainability in all these Petitions mentioned above against the Petitioner.
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Service Tax
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2016 (12) TMI 1184
Condonation of delay of 10 days in filing appeal - delay due to their authorised signatory, on continuous tour - Held that: - by taking a liberal approach, and considering that the delay in filing the appeal before learned Commissioner (A) was not intentional and deliberate - delay condoned.
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2016 (12) TMI 1183
CENVAT credit - GTA service - service tax paid on Goods Transport Agency (GTA) services for outward transportation of goods manufactured for the period prior to 1.4.2008 - Held that: - the issue is no longer res integra and has been settled by the decision in the case of ABB Ltd. [2011 (3) TMI 248 - KARNATAKA HIGH COURT], where it was held that prior to amendment of definition of input service “up to the place of removal” in place of “from the place of removal”, the credit of service tax would be admissible - appeal allowed - decided in favor of appellant.
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2016 (12) TMI 1182
Refund claim of unutilised CENVAT credit - rule 5 of the CCR, 2004 - appeal dismissed on ground of delay - Held that: - the delay in filing the appeal before the learned Commissioner (A) was not intentional and deliberate and therefore delay is condoned in filing the appeals - appeals to be decided on merit - appeal allowed by way of remand.
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2016 (12) TMI 1181
CENVAT credit - centralised registration - utilisation of credit taken in one unit with respect to other units - Held that: - A case cannot be held against the Respondent based on presumptions, assumptions and surmises which are not even a part of the show cause notice dated 31.03.2013 After taking of centralized registration in 2013 respondent was having more than one units which were existing during the earlier period also. It is observed from the case records that the fact of having more than one manufacturing unit all over the country was taken up for the first time by the Revenue before the first appellate authority and then before this Bench. Ld.Commissioner(Appeals) under Order-in-Appeal dated 29.07.2015 has correctly discussed in para 9 that the grounds now brought in by the department were not the subject matter of the show cause notice - appeal dismissed - decided against revenue.
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2016 (12) TMI 1180
Admissibility of appeal - pre-deposit - Section 35F of the Central Excise Act, 1944 - Learned Advocate relied upon the Apex Court’s order dated 12.09.1967 in the case of Lakshmiratan Engineering Works Ltd. vs. Assistant Commissioner (Judicial) I, Sales Tax, Kanpur Range, Kanpur and Another [1967 (9) TMI 116 - SUPREME COURT OF INDIA], holding that appeal is maintainable even if deposit is not made - Held that: - It is observed from proviso to Section 9 of U.P.Sales Tax Act, 1948 quoted in the case law relied upon by the Appellant, that only admitted tax liability was required to be paid by an assessee in Sales Tax. In the case of Section 35F of the Central Excise Act, 1944 mandatory deposit is not with respect to admitted duty liability of the Appellant. Therefore, the case law relied upon by the Appellant is not applicable - Appeal is not required to be entertained in view of the mandatory deposit not made under Section 35F of the Central Excise Act, 1944 - appeal not maintainable.
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2016 (12) TMI 1179
CENVAT credit - as per Rule 3(1) (xi) of Cenvat Credit Rules, 2004 (CCR) credit of services availed before 10/9/2004 was not admissible - Revenue repeatedly requested the appellant to provide Credit Registers maintained for the year 2005-2006 but appellant did not co-operate - whether appellant entitled to CENVAT credit? - Held that: - all the original computerised copies of RG 23A Pt. II and invoices are with the appellant. Jurisdictional Range Supdt. Asked appellant by communications dated 14/7/2009 and 10/8/2009 to provide copies of the said documents. Instead of making the desired documents available appellant is asking for certain details which may not be available with the department - no reason found to interfere with the order of the original authority - appeal dismissed - decided against appellant.
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Central Excise
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2016 (12) TMI 1178
Remission of duty - loss of goods by fire - denial on the ground that appellant has taken credit with respect to inputs used in the manufacture of finished goods destroyed in fire - Held that: - It is now a settled legal proposition that inputs which get used in the manufacture of finished goods to be treated as properly utilized under the credit rules made under the Central Excise Rules, 1944. Therefore, inputs used in the manufacture of finished goods, which are subsequently destroyed, is not required to be reversed. Denial also on the ground that appellant has been compensated by the insurance company against the goods destroyed in fire and that the monetary compensation does not include Central Excise duty on the finished goods destroyed in fire, has not been substantiated - Held that: - It is observed from a letter dated 14.01.2004, written by the insurance company to the appellant, that the claim of ₹ 34,05,867/-(Rupees Thirty Four Lakhs Five Thousand Eight Hundred and Sixty Seven only) paid to the appellant was excluding Excise duty. However, this letter dated 14.01.2004 and the insurance application for seeking insurance claim filed by the appellant have not been brought on record - remanded back to the Adjudicating authority for deciding the case in remand proceedings on the issue of insurance claim filed by the appellant and whether Central Excise duty element is excluded from the claim paid to the appellant. Appeal allowed by way of remand.
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2016 (12) TMI 1177
Imposition of penalty u/r 13(2) of Central Excise Rules, 2002 - the appellant took credit in their books i.e. Cenvat Register, which was earlier debited by way of pre-deposit during the pendency of appeal - whether the appellant was not entitled to take suo-moto credit in absence of any provision under Central Excise Law permitting suo-moto credit? - Held that: - there is no element of suppression or fraud in taking of credit of pre-deposit which was paid by way of debit in the Cenvat Account, pending disposal of the appeal. Under the facts and circumstances there has been no violation of any Act or Provisions of the Rules. We find the penalty imposed is not sustainable. Accordingly, we set aside the impugned order and allow the appeal - decided in favor of appellant-assessee.
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2016 (12) TMI 1176
Clandestine removal of duty paid inputs - Held that: - I find that the Department has not brought on any tangible evidence to prove clandestine removal of duty paid inputs by the appellant - On perusal of the statement and the invoices, it reveals that charges of suppression or misstatement cannot be levelled against the appellant. Since the duty alongwith interest was deposited by the appellant on detection of mistake by the Central Excise Audit Wing and before issuance of show cause notice, I am of the view that the case of the appellant is covered under sub-section (2B) of Section 11A ibid, which mandates that on payment of duty alongwith interest, no show cause notice shall be issued and for all practical purpose the matter has to be closed. The explanation appended to Section 11A (2B) ibid will not have any application to the facts and circumstances of the present case since the clandestine motive of the appellant in defrauding the Government revenue has not been substantiated by the Department with the help of any tangible evidence. Appeal allowed - decided in favor of appellant-assessee.
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2016 (12) TMI 1175
Demand - Refund - Notification No.32/99-CE dated 08.07.1999 - Interest - Penalty - Rule 173Q, Rule 230 of Central Excise Rules, 1944 - Held that: - Hon’ble Apex Court in its judgment R.C. Tobacco Pvt. Ltd. -vs.- Union of India [2005 (9) TMI 80 - SUPREME COURT OF INDIA] upheld the constitutional validity of Sec.154 of the Finance Act 2003 and has also held that period of demand under Sec.11A of the Central Excise Act 1944 would not apply to the recovery of dues under Sec.154(4) of the Finance Act, 2003 - Appellant has argued that a quantified recovery letter/communication was required to be issued to them, under the provisions of Sec.154(4) of the Finance Act, 2003 specifying the demands/refund paid to them, alongwith specified amount of interest, so that appellant could pay the dues within 30 days from the assent of the President given to the Finance Bill, 2003 - Apex Court held that issuing of a demand show cause notice for the amount recoverable under the mandate of Section 154 of the Finance Act, 2003 will be an empty formality and stands covered by ‘useless formality theory’. The amount of duty in the case of Dharampal Satyapal vs. DCCE, Gauhati [2015 (5) TMI 500 - SUPREME COURT], decided by Apex Court, was also quantified and communicated to the appellant Dharmapal Satyapal Ltd. by a recovery order of June, 2003, as evident from Paras-6 and 39 of this case law As per the above provisions of Section 154(4) recovery shall be made of duty, interest or other charges within a period of 30 days from the day on which Finance Bill 2003 receives assent of President. The amounts recoverable will include interest payable under Sec.11AB of the Central Excise Act, 1944 even if not specifically mentioned in Section 154(4) of the Finance Act - Apex Court held that issuing of a demand show cause notice for the amount recoverable under the mandate of Section 154 of the Finance Act, 2003 will be an empty formality and stands covered by ‘useless formality theory’. The amount of duty in the case of Dharampal Satyapal vs. DCCE, Gauhati (supra), decided by Apex Court, was also quantified and communicated to the appellant Dharmapal Satyapal Ltd. by a recovery order of June, 2003, as evident from Paras-6 and 39 of this case law - Appeal allowed - decided in favor of the assessee.
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2016 (12) TMI 1174
CENVAT credit - rent-a-cab service - customs house agent service - courier service - appellant is a manufacturer who has utilised the three services on which tax under Finance Act, 1994 was also properly discharged. It is also admitted that the expression 'in or in relation to manufacture' is not susceptible to precise delineation - Held that: - reliance placed on the decision of the case of Commissioner of Central Excise, Bangalore - 111 v. Stanzen Toyotetsu India (P) Ltd [2011 (4) TMI 201 - KARNATAKA HIGH COURT], where it was held that under the scheme of the Cenvat Credit Rules, 2004, the service tax paid on all those services which the assessee has utilized directly or indirectly in or in relation to the final product is entitled to claim the credit - eligible service for availment of input credit - appeal allowed - decided in favor of appellant.
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2016 (12) TMI 1173
Refund claim - time bar - Held that: - It is observed from Order-in-Appeal dated 30.07.2007 that first appellate authority extended personal hearing to the Appellant on three occassions, but Appellant herein did not attend any of those personal hearings. Even in the cross-objections, filed by the Appellant before the first appellate authority, also Appellant did not bring out that the earlier Order-in-Appeal dated 20.07.2004 passed by the same appellate authority to the effect that time bar aspect of the refund claim already stands decided for the same refund claim. However, in the interest of justice Order-in-Appeal dated 30.07.2007 is set aside as the same appellate authority cannot take contrary views on an issue in the same proceedings on time bar nature of the refund claim. Accordingly Appeal filed by the Appellant is allowed by way of remand to the First Appellate authority by setting aside the Order-in-Appeal dated 30.07.2007. First appellate authority should extend an opportunity of personal hearing to the Appellant to explain their case - appeal allowed by way of remand.
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2016 (12) TMI 1172
Classification of goods - Rubber Sheets - classified under the Tariff Item No. 40082110 of schedule to Central Excise Tariff Act, 1985 or under Tariff Item No. 40082910 - samples were collected for testing and several tests undergone - the samples were categorised as Cellular/ Non-cellular/Others - Whether the sample contain RESIN as one of the constituent, or the sample is Resin Rubber Sheet? - Held that: - the reliance is placed on various test reports. The ld. Counsel for the appellants has emphasized that the test report dated 08-05-2013 gives a report that the both samples are Non-cellular as well as resin based rubber sheet. Non-cellular Rubber Sheet falls under Chapter 400821 whereas resin based rubber sheet falls under Chapter 40082910. We understand that further clarification on said discrepancy in the test report is needed. The appellants sought Cross-examination of the concerned authorities concerned with the testing of the samples and the same was found to be not allowed by the Original Authority. Therefore, it appears that complete opportunity to represent the cases was not given by the Original Authority. The Original Authority is required to give complete opportunity of presenting the case and then adjudicated the matter. We considered that the principles of natural justice have not been followed by the Original Authorities in these appeals - matter remanded to the Original Authority who shall give opportunity of presenting their case to the appellants once again and provide opportunity to cross-examine any of the witnesses that appellants desires to cross-examine - appeal allowed by way of remand.
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2016 (12) TMI 1171
Refund claim - the manufacturer did not claim exemption, whereas the appellant, the customer claims refund on the basis of exemption notification - Whether an assessment made by the manufacturer can be changed by way of a refund claim filed by the customer? - Held that: - It is observed that similar issue was decided by CESTAT Delhi in the case of Inalsa Appliances Ltd. v. Commissioner of C.Ex., Delhi-IV, Faridabad [2004 (6) TMI 463 - CESTAT, NEW DELHI] - In the case juicers were manufactured by M/s.AAR AAR Plastics and received by Appellant M/s. Inalsa Appliances Ltd. Refund claim in the relied upon case was also filed by M/s.Inalsa Appliances Ltd. when the manufacturer did not challenge the assessments and it was held in the case that In absence of any excess payment of duty, the question of the appellants filing a refund claim does not arise. Respondent herein is not eligible to refund claim when the original manufacturer has not sought exemption of the said Notification. It is also the case of the department that Notification No.6/2002-CE dated 01.03.2002 is a conditional Notification which can be seen to have been fulfilled only at the time of clearance of the goods from the manufacturer’s end - refund claim not allowed. Appeal allowed - decided in favor of Revenue.
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2016 (12) TMI 1170
Rejection of refund claim - rejection on the ground that Appellant has not filed the refund claim in the prescribed form - Held that: - It is observed from case records that Adjudicating authority vide Order-in-Original dated 14.02.2007, while rejecting the refund claim, did not deliberate on this issue and no Appeal was filed by Revenue against Order-in-Original dated 14.02.2007. Revenue cannot be allowed to raise this point at this stage when the same was not an issue decided by the Adjudicating authority against which no appeal was filed by department - It is further observed that Adjudicating authority under Order-in-Original dated 28-31/12/1998, while allowing the deductions, finalized the price lists/price declarations by an appealable order. The same was not contested by the department and has become final. The refund is thus due to the Respondent, however, subject to the method of quantification adopted by the Respondent while claiming the refund amount. Onus of establishing the correct refund amount lies on the applicant (Respondent). The matter has been remanded to the Adjudicating authority for quantification of refund admissible. Appeal allowed by way of remand.
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2016 (12) TMI 1169
Waiver of pre-deposit - Penalty - Illicit manufacturing - Rule 17 (2) of Pan Masala Packing Machines (Capacity Determination & Collection of Duty) Rules, 2008 - Held that: - it is an admitted fact that when the premises were raided by the police officers they found in the said premises of the appellant two pouch packing machines which were running with the aid of power on which illicitly Pan Masala/Gutkha were being manufactured. It is further evident from the police report that as mentioned in the SCN that the manufacturer was being done of DilBahar brand Gutkha belonging to one M/s Kanti Chemicals, Kanpur who is the brand owner. Under the facts and circumstances of the present and in view of the poor financial status pleaded before us, we direct the appellant to make a pre-deposit of ₹ 5 lakhs subject to which the balance demand and penalty shall remain stayed till disposal of the appeal. Compliance is to be made on or before 30-11-2016.
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2016 (12) TMI 1168
Maintainability of appeal - mandatory deposit of duty required to be made under Section 35F (i) of the Central Excise Act, 1944 has been paid from the CENVAT Account maintained by the appellants - whether mandatory deposit of seven and half per cent as per Section 35F (i) of the Central Excise Act 1944, is required to be paid in cash or the same can be paid from CENVAT Credit Account maintained by the appellants? - Held that: - it is not specifically mentioned in section 35F, that amount has to be deposited only by way of cash payment. Rule 3(4) of CENVAT Credit Rules, 2004 says that In a case of dispute about admissibility of CENVAT Credit, ultimate action against an assessee, if found to be inadmissible to CENVAT Credit, will be to reverse CENVAT Credit taken. In such a case there may not be any need to make pre deposit in cash. Similarly, in the case of demand of duty, if CENVAT Credit is permissible for payment of tax, the same can always be debited from CENVAT Account of an assesse. As per procedure followed by CESTAT Registry at Kolkata, payments made from CENVAT Credit Account are considered as due payments for considering as deposit under Section 35F (ii) and (iii) of Central Excise Act, 1944. Thus, the view taken by the First Appellate Authority, that deposit under Section 35F (i) cannot be made from CENVAT Credit Account, is not the correct appreciation of law so long as the CENVAT Credit is permissible for utilisation as per Rule 3(4) of the CENVAT Credit Rules, 2004 - The appellants are allowed by way of remand to the First Appellate Authority with directions to decide the appeals on merits - Appeal allowed by way of remand.
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2016 (12) TMI 1167
Area based exemption - Whether the duration of 10 years exemption to the appellant should be determined as per clause 4 of Notification No 32/1999-CE dt 8/7/1999 or the same should be calculated from 12/2/2002 when area of the appellant was included into Notification No. 32/99-CE by Notification No. 5/2002-CE dt 12/2/2012? - Held that: - It is observed from clause 4 of Notification No. 32/99-CE that period of 10 years has to be calculated from the date of publication of this notification or from the date of commencement of commercial production of a unit, whichever is later. There is no provision in this exemption notification that for the areas added by subsequent notifications this period of 10 years has to commence from the date of any subsequent notification. It is a well accepted legal proposition that while granting the benefit of an exemption notification Rule of strict interpretation should be followed. In the absence of any provision, argument of the appellant that 10 years period of exemption should be counted from 12/2/2002, is required to be rejected as commercial production of the appellant started from 8/12/1998. The benefit of exemption notification with effect from 8/7/1999 has been correctly interpreted by the lower authorities. Appeal dismissed - decided against appellant.
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2016 (12) TMI 1166
SSI Exemption - Benefit of value based exemption Notification No.9/2003-CE dated 01.03.2003 - whether the notification has retrospective effect or prospective effect? - Held that: - An amendment was carried out in Notification No.9/2003-CE; by Notification No.67/2003-CE dated 11.08.2003 by which clause (e) was added to Notification No.8/2003-CE and 9/2003-CE, both dated 01.03.2003, according to which clearances effected under Notification No.214/86-CE dated 25.03.1986, 83/94-CE and 84/94-CE were not required to be added to the value of clearances - As per the observations made by Apex Court in para-11 of the case law Kartar Rolling Mills vs. CCE, New Delhi [2006 (3) TMI 63 - SUPREME COURT OF INDIA] the benefit of an exemption notification cannot be extended retrospectively - Notification 67/2003-CE was issued on 11.08.2003 and cannot be held to be effective from 01.04.2003. Time bar - Held that: - first appellate authority has given elaborate findings as to how demand is not time barred which is acceptable. However, since the issue was relating to complex interpretation of exemption/amending notifications we are of the considered opinion that penalty against the appellant is not sustainable and is set aside. Appellant has also raised the issue that even if the value of clearances of both their units are added to the value of clearances still their total value of clearances will be less than ₹ 3.00 Crore. It is also argued that this issue was raised before the first appellate authority but the same has not been commented upon by the first appellate authority - In the interest of justice this argument of the appellant that their value of clearances in the entire financial year 2003-04 has not exceeded ₹ 3.00 Crore even if goods exempted during the period 11.04.2003 to 10.08.2003 are included in the value of clearances, needs examination. The matter is remanded to the Adjudicating authority only for the limited purpose to examine the issue contained in this paragraph. Appeal allowed by way of remand.
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2016 (12) TMI 1165
Denial of benefit of notification - N/N.06/2006-CE read with N/N.21/2002-CUS - denial on the ground that as required in N/N.6/2006-CE, the appellant does not fulfill the related conditions in Notification No.21/2002-CUS being - the power purchasing state has agreed to provide recourse to that state’s share of Central plan allocations and other devolutions towards discharge of any outstanding payment in respect of purchase of power. Held that: - reliance placed on the decision of the case of Jindal Steel & Power Ltd. [2015 (6) TMI 657 - CESTAT NEW DELHI], where it was held that When a particular condition prescribed in Notification No. 21/02-Cus. for full customs duty exemption is not applicable and for this reason, the condition cannot be satisfied, its fulfilment cannot be insisted in accordance with the principle of lex non cogit ad impossiblia which is applicable to the tax matters also - the denial of exemption under Notification No.6/02 -CE and 6/06-CE on the ground that the goods imported would not be eligible for customs duty exemption under Notification No.21/03-Cus. is not correct. It was further held that condition No.29 of N/N.21/2002-CUS applies to importer of goods and not to domestic manufacturer of said goods. Appeal allowed - decided in favor of appellant-assessee.
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2016 (12) TMI 1164
Seizure - Penalty - Rule 27 of CER, 2002 - Held that: - It was also observed that though there was escapement of recording of the finished goods, but the ingredients of Section 11AC were found to be absent - It was observed that since the goods were found in the factory itself, on the date of inspection dated 19/9/2007, imposition of redemption fine was unwarranted - In the course of argument the learned counsel for the appellant have produced the original RG-I register wherein the said quantity of 6945.89 kg. of copper sheet etc. have found to be entered on 14/01/2008 - decided in favor of appellant-assessee.
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2016 (12) TMI 1163
Maintainability of appeal - mandatory deposit of duty required to be made under Section 35F (i) of the Central Excise Act, 1944 has been paid from the CENVAT Account maintained by the appellants - whether mandatory deposit of seven and half per cent as per Section 35F (i) of the Central Excise Act 1944, is required to be paid in cash or the same can be paid from CENVAT Credit Account maintained by the appellants? - Held that: - it is not specifically mentioned in section 35F, that amount has to be deposited only by way of cash payment. Rule 3(4) of CENVAT Credit Rules, 2004 says that In a case of dispute about admissibility of CENVAT Credit, ultimate action against an assessee, if found to be inadmissible to CENVAT Credit, will be to reverse CENVAT Credit taken. In such a case there may not be any need to make pre deposit in cash. Similarly, in the case of demand of duty, if CENVAT Credit is permissible for payment of tax, the same can always be debited from CENVAT Account of an assesse. As per procedure followed by CESTAT Registry at Kolkata, payments made from CENVAT Credit Account are considered as due payments for considering as deposit under Section 35F (ii) and (iii) of Central Excise Act, 1944. Thus, the view taken by the First Appellate Authority, that deposit under Section 35F (i) cannot be made from CENVAT Credit Account, is not the correct appreciation of law so long as the CENVAT Credit is permissible for utilisation as per Rule 3(4) of the CENVAT Credit Rules, 2004 - The appellants are allowed by way of remand to the First Appellate Authority with directions to decide the appeals on merits - Appeal allowed by way of remand.
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2016 (12) TMI 1162
Imposition of penalties - shortage in stock - clandestine removal - Held that: - I find that no evidence has been brought on record to substantiate that the shortage of goods detected during the course of investigation were clandestinely removed by the appellant. In absence of any positive evidence of clandestine removal of the goods, I am of the opinion that imposition of penalty on the Company as well as on its Managing Director is not justified. Therefore, I set aside the impugned order with regard to imposition of penalty and allow the appeals. Appeal disposed off - penalty set aside - decided in favor of appellant-assessee.
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2016 (12) TMI 1161
CENVAT credit - Outdoor Catering Services - Group Insurance Services - denial on the ground that these activities are not in relation to the appellant’s manufacturing activity - Held that: - In the case of Commissioner of Central Excise, Nagpur v. Ultratech Cement Ltd. [2010 (10) TMI 13 - BOMBAY HIGH COURT] held that credit with respect to ‘Outdoor Catering Services’ is admissible - Hon’ble Karnataka High Court in the case of CCE & ST, LTU, Bangalore v. Micro Labs Ltd. [2011 (6) TMI 115 - KARNATAKA HIGH COURT] also held that such credit on ‘Group Insurance Services’ is admissible - credit allowed - decided in favor of appellant-assessee.
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2016 (12) TMI 1160
Rejection of credit availed - the appellant was not given any SCN before rejecting the credit availed - Air & smoke monitoring services - Credit rating agency service - Calibration services - Audit services - Dozer and loader hire services - Held that: - As per OIO dated 29.07.2009 the service tax credit disallowed to the appellant is with respect to services of outward transportation goods. However, appellant has now taken a fresh ground before this bench that no show cause notice was issued to them and the cenvat credit of ₹ 58,806/- recovered in the order dt. 29.07.2009 by the Adjudicating Authority was with respect to some other services (as mentioned above). As this is a new ground taken by the appellant which was not agitated before the lower authority, therefore, in the interest of justice, by setting aside OIA dated 14.02.2011 passed by the First Appellate Authority, the case is remanded to the Adjudicating Authority for deciding the admissibility of cenvat credit afresh - appellant should be given an opportunity of personal hearing - appeal allowed by way of remand.
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2016 (12) TMI 1159
Levy of Penalty - Rule 25 & 26 of the Central Excise Rules, 2002 - Held that: - confiscation and penalty under this Rule can be decided against a producer, manufacturer, registered person, warehouse or the registered dealer. As the appellant is none of these, therefore, no penalty can be imposed upon the appellant under Rule 25 of the Central Excise Rules, 2002 - it is observed that no such observations have been made by the Adjudicating Authority and the First Appellate Authority to justify that imposition of penalty under Rule 26 of the Central Excise Rules, 2002 - Decided in favor of the assessee.
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CST, VAT & Sales Tax
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2016 (12) TMI 1150
Release of confiscated goods - discrepancies found in stock of dry chilly - order of release of the goods without security by Tribunal - is Tribunal justified in doing so? Held that: - The discrepancy was explained by the respondent assessee but the explanation was found to be unsatisfactory by the Mobile Squad Authority. The stand of the assessee that no discrepancies whatsoever was found in his books of accounts, is the matter to be examined at the time of penalty proceedings, if any, or at the time of assessment proceedings. However, it can not be said that there was absolutely no material before the Mobile Squad Authority to seize the goods and to demand security - therefore, ends of justice should be better served if the goods are directed to be released on deposit of the security in the form of other than cash or bank guarantee for an amount equivalent to the amount of tax as may be involved with respect to the seized goods. Goods to be released on payment of security - appeal disposed off - decided partly in favor of respondent-assessee.
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2016 (12) TMI 1149
Release of confiscate goods - requirement of Form 21 - Held that: - if the respondent assessee deposits the cash security as offered, the goods shall be released - merits of the case not examined - decided partly in favor of resppondent-assessee.
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Indian Laws
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2016 (12) TMI 1147
Recovery of amounts due under the SARFAESI Act - Failure to repay bank loan - bank initiated arbitration proceedings - Held that:- Mere pendency of the arbitration proceedings would not disentitle the said respondents from recovering the amounts due under the SARFAESI Act. As regards the observations expressed by the Co- Operative Tribunal, the petitioners still have an opportunity of raising all the pleas legally available to them, including the aspect on which the Tribunal has made its observations, by availing the remedy under Section-17 of the SARFAESI Act against the measures initiated by respondent Nos.1 and 4 before the Debts Recovery Tribunal.Subject to the liberty given to the petitioners as above, the Writ Petition is dismissed.
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