Jul 292014
 

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capital gain tax – Income Tax – Started By: – MITHUN SAHA – Dated:- 28-7-2014 Last Replied Date:- 30-12-1899 – sir.I am going to sell land and building in current year 2014-15 for ₹ 25,00000/- which i am holding for more than three years…The Indexed cost of acquisition is ₹ 1750000/-(approx). My question is1) Can i take Indexed cost of improvement as ded………………

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Jul 282014
 

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BUDGET CHANGES REGARDING DTA CLEARANCES – Central Excise – Started By: – SANDESH SHINDE – Dated:- 28-7-2014 Last Replied Date:- 28-7-2014 – Dear Sir,Please explain regarding changes made as per notification 18/2014 ce of clearances made by eou unit to dta unit,pls explain in simple words,thanks and regards. – Reply By Pradeep Khatri – The Reply = Dear Sandesh,It means that Education ce………………

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Jul 282014
 

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RBI Reference Rate for US $ and Euro – Dated:- 28-7-2014 – The Reserve Bank of India s Reference Rate for the US dollar is ₹ 60.1013 and the Reference Rate for Euro is ₹ 80.7385 on July 28, 2014. The corresponding rates for the previous day (July 25, 2014) were ₹ 60.1448 and ₹ 81.0173 respectively. Based on the Reference Rate for the US dollar and the middle rates of the cross-currency quotes, ………………

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Jul 282014
 

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Interim Budget 2014 — Changes and clarification on Customs and Central Excise – Central Excise – F. No. 334/3/2014-TRU – Dated:- 17-2-2014 – Government of India Ministry of Finance (Department of Revenue) Central Board of Excise & Customs, New Delhi dated 17-2-2014 The Finance Minister has presented the Interim Budget 2014-15 in Lok Sabha today, i.e., 17-2-2014. Certain changes have been made in the effective rates of Customs and Central Excise. To give effect to these changes, the following notifications have been issued : CUSTOMS NOTIFICATION NOS. DATE Tariff No. 5/2014-Customs and No. 6/2014-Customs 17th February, 2014 CENTRAL EXCISE Tariff No. 4/2014-Central Excise 17th February, 2014 All changes in rates of duty take effect from the date of publication of the notifications in the Official Gazette i.e. 17-2-2014. 2. The changes made are contained in the Annex appended to this letter, which provides a summary of the changes made. However, the details are contained in the notifications which alone have legal force. 3. Every possible effort has been made to avoid the errors or mistakes in the notifications. I shall be grateful, if the provisions of the notifications are studied carefully and feedback on issues that may need clarification including inadvertent errors, if any, that may have crept in, is provided urgently. 4. In case of any doubt or difficulty, I would request you to kindly bring it to my notice immediately or to the notice of Shri Amitabh Kumar, Director (TRU) (Tel. No. 011-2309 2236; e-mail : amitabh.kumar@nic.in, Shri G.G. Pai, Director (TRU) (Tel No. 011-2309 2753; e-mail : giridhar.pai@nic.in or Shri Akshay Joshi, Budget Officer (TRU) (Tel No. 011-2309 5547; e-mail : joshi.akshay @nic.in). 5. Copies of relevant notifications can be downloaded directly from www.cbec.gov.in. Annex CUSTOMS (1) Full exemption from customs duty on pulses valid till 31-3-2014 has been extended by another 6 months i.e. up to 30-9-2014 [Clause (a) of the proviso to the notification No. 12/2012-Customs, dated 17-3-2012 as amended by notification No. 5/2014-Customs, dated 17-2-2014 refers]. (2) CVD exemption hitherto available on specified road construction machinery has been withdrawn. These specified machinery will henceforth attract CVD and SAD. Exemption from the basic customs duty will however continue [Sl. No. 368A of the Table read with List 16A of notification No. 12/2012-Customs, dated 17-3-2012 as amended by notification No. 5/2014-Customs, dated 17-2-2014 refers]. (3) The basic customs duty structure on non-edible grade industrial oils and its fractions, palm stearin, fatty acids and fatty alcohols has been rationalised at 7.5% [Sl. No. 51, 187A and 230 of the Table of notification No. 12/2012-Customs, dated 17-3-2012 as amended by notification No. 5/2014-Customs, dated 17-2-2014 refers]. (4) LNG consumed in the authorized operations in the ONGC SEZ unit at Dahej and the remnant LNG cleared into the domestic tariff area (DTA) has been exempted from basic customs duty and CVD [Sl. Nos. 138A and 138B of the Tabl………………

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Jul 282014
 

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Seeks to impose provisional anti-dumping duty on imports of Purified Terephthalic Acid (PTA) originating in, or exported from the People’s Republic of China, European Union, Korea RP and Thailand for a period of six months. – Customs – 36/2014 – Dated:- 25-7-2014 – [TO BE PUBLISHED IN PART II, SECTION 3, SUB-SECTION (i) OF THE GAZETTE OF INDIA, EXTRAORDINARY] GOVERNMENT OF INDIA MINISTRY OF FINANCE (DEPARTMENT OF REVENUE) Notification No. 36/2014-Customs (ADD) New Delhi, the 25th July, 2014 G.S.R. (E). –WHEREAS in the matter of Purified Terephthalic Acid (PTA) including its variants – Medium Quality Terephthalic Acid (MTA) and Qualified Terephthalic Acid (QTA) (hereinafter referred to as the subject goods) falling under tariff item 2917 36 00 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), originating in, or exported from the People s Republic of China, European Union, Korea RP and Thailand (hereinafter referred to as the subject countries), and imported into India, the designated authority in its preliminary findings published in the Gazette of India, Extraordinary, Part I, Section 1,vide notification No. 14/7/2013-DGAD dated 19th June, 2014, has come to the conclusion that – (a) the subject goods have been exported to India from the subject countries below their normal value thus resulting in the dumping ; (b) the domestic industry has suffered material injury due to dumping of the subject goods from the subject countries; (c) the material injury has been caused by the dumped imports from the subject countries. AND WHEREAS, the designated authority in its aforesaid findings, has recommended imposition of provisional anti-dumping duty on the subject goods, originating in or exported from the subject countries and imported into India, in order to remove injury to the domestic industry; NOW, THEREFORE, in exercise of the powers conferred by sub-section (2) of section 9A of the Customs Tariff Act, 1975 (51 of 1975), read with rules 13 and 20 of the Customs Tariff (Identification, Assessment and Collection of Anti-dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995, the Central Government, after considering the aforesaid preliminary findings of the designated authority, hereby imposes on the subject goods, the description of which is specified in column (3) of the Table below, falling under Tariff Item of the First Schedule to the said Customs Tariff Act as specified in the corresponding entry in column (2), originating in the country as specified in the corresponding entry in column (4), and produced by the producer as specified in the corresponding entry in column (6), when exported from the country as specified in the corresponding entry in column (5), by the exporter as specified in the corresponding entry in column (7), and imported into India, an anti-dumping duty at the rate equal to the amount as indicated in the corresponding entry in column (8), in the currency as specified in the corresponding entry in column (10) and as per unit of measurement as specified in the corresponding entry in column (9) of the said Table Table Sl. No. Tariff Item Description of goods Country of origin Country of export Producer Exporter Amount Unit Currency (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) 1 2917 36 00 Purified Terephthalic Acid. People s Republic of China People s Republic of China Any Any 62.82 Metric Tonnes United States Dollar 2 2917 36 00 Purified Terephthalic Acid. People s Republic of China Any country other than those subject to anti -dumping duty. Any Any 62.82 Metric Tonnes United States Dollar 3 2917 36 00 Purified Terephthalic Acid. Any country other than those subject to anti -dumping duty. People s Republic of China Any Any 62.82 Metric Tonnes United States Dollar 4 ………………

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Jul 282014
 

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M/s Parksons Cartamundi Pvt. Ltd. and M/s Parksons Graphics Pvt. Ltd. Versus CCE Daman – Central Excise – CESTAT AHMEDABAD – Tri – Benefit of Exemption notification to the product Playing Cards – Notification No.02/2011-CE – Rate of duty 5% (now 6%) – playing cards are Sports goods or not – Held that:- The plain interpretation of said notification would indicate that the appellant is eligible to avail the said benefit of notification if his product falls under Chapter 95. In the case in hand, there is no dispute that the appellant’s product Playing Cards is classifiable under Chapter 95 and more specifically under Chapter sub-heading No.95.04. The issue of the benefit of exemption claimed under notification in respect of playing cards as sports goods has been settled by the Tribunal in Esbee Playing Card Co (1996 (12) TMI 147 – CEGAT, NEW DELHI) – benefit of exemption allowed – Decided in favor of assessee. – 2014 (7) TMI 985 – CESTAT AHMEDABAD – TMI – Appeal No.E/13967,13968/2013-DB – Order No.A/11200-11201/2014 – Dated:- 8-7-2014 – MR.M.V. RAVINDRAN AND MR. H.K. THAKUR, JJ. For the Appellant : Shri S.S. Gupta, C.A., Shri Anand Nainawati, Adv. For the Respondent : Shri K. Sivakumar, Addl.Commissioner (AR) JUDGEMENT Per: M.V. Ravindran; 1. These two appeals are disposed by a common order as they raise a very same issue of law and facts. 2. The relevant facts that arise for consideration are that both the appellants herein are manufacturer of Playing Cards, Puzzle Games etc falling under Chapter No.95 of the Schedule 2 of Central Excise Tariff Act, 1985. The appellants herein had from April 2011 claiming benefit of payment of duty to the extent of 5% as provided under Notification No.02/2011-CE, dt.01.03.2011 vide Entry No.75. During the course of Audit in year 2011, the audit officers were of the view that the said benefit of Notification No.02/2011-CE, dt.01.03.2011 is not applicable to the appellant s product Playing Cards . A show cause notice was issued directing the appellant to show cause as to why the benefit as claimed by the appellant be not denied to them and differential duty be not demanded along with interest and penalties be not imposed. The appellant contested the issue on merit before the lower authorities. The adjudicating authority, after following the due process of law, confirmed the demand raised along with interest and imposed penalties. 3. Ld.Counsel appearing on behalf of the appellant would give overall view of the issue and submit that the adjudicating authority has erred in coming to conclusion that the sports and games are different and the benefit of exemption Notification No.02/2011-CE, dt.01.03.2011 is only for Sports, which has to be an activity related to physical activity. He would then take us through the order of the Commissioner and submit that the adjudicating authority has wrongly relied on the dictionary meaning of the Games and Sports. He would submit that the meaning of the word Games & Sports are inter-changeable and playing card is also a game as has been upheld by this Tribunal in the case of Esbee Playing Card Co Vs CCE – 1997 (90) ELT 357 (T). He would also submit that the Apex Court in the case of Pleasantime Products – 2009 (243) ELT 641 (SC) has given a gainful meaning to the word Games , wherein their Lordship have held that Game is a form of play or sport especially a competitive one, played according to rules and decided by skill and chance. It is his submission that the playing cards which are manufactured by the appellant are used for playing a game called Bridge which is definitely a sport since various sports associations engaged and organize the Bridge as a sport event and playing Bridge does not involve any bodily exercise. It is his submission that the sport Bridge can be classified under heading of Chapter 95 and the benefit of Entry No.75 of Notification No.02/2011-CE, dt.01.03.2011 cannot be denied. It is his submission that the Apex Court in the case of Mewar Bartan Nirman Udyog 2008 (231) ELT 27 (SC) has held that the interpretation of tariff is different from the interpretation of exemption notification. It is also his submission that the CBEC Circular No.B.35/91/75-TRU, dt.21.08.1976 has given a clarification that the sports goods has too wide a scope and it is difficult to define it comprehensively. It is his submission that the Commissioner of Sales Tax Maharashtra, Gujarat Value Added Tax Tribunal, Commissionerate of Value Added Tax, Goa, and Advance Ruling Karnataka Value Added Tax have laid down that the playing cards are sports goods. It is submission that the impugned order be set aside and appeal be allowed. 4. Shri Anand Nainawati, ld.Counsel appearing for one of the appellant would submit that the information obtained under RTI act in respect of the appellant s factory at Bombay i.e. Parksons Graphics Pvt. Ltd. on TM Printers clearly substantiate that the Mumbai Commissionerate has accepted the Playing Cards as sports goods. 5. Ld.Departmental Representative, on the other hand, would draw our attention to the description of Sr.No.75 to Notification No. 02/2011-CE, dt.01.03.2011. It is his submission that the sports goods as mentioned in the description should have always a relation to the physical activity. It is his submission that the playing cards do not get classified under sports goods as there is no physical activity engaged in playing cards. He would then draw our attention to the decision of the Tribunal in the case of Funskool (I) Ltd – 2002 (150) ELT 1150 (Tri-Del) and more specifically Para No.5 and submit that the Bench has held that Chess Boards, Pieces and Chinese Checkers are sports goods as they do not require any bodily exercise in their use and therefore will be classifiable under Chapter Heading No.95.04. It is his submission that the exemption was denied in respect of such goods by the Tribunal. He would submit that the ratio laid down by the said decision would indicate that to claim the benefit as a sports goods, the activity should be identifiable with physical exercise and it is the necessity. 6. We have considered the submissions made at length by both sides and perused the records. 7. The issue involved in this case is whether the appellant who is manufacturing playing cards and classifying the same under Chapter sub-heading No.95.04 of the First Schedule to Central Excise Tariff Act, 1985 is eligible to avail exemption from payment of Central Excise duty to the extent of 5% / 6% under Notification No. 02/2011-CE, dt.01.03.2011 as amended and as per the description at Entry No.75 of the said notification. 8. The adjudicating authority, in the impugned order, has relied upon various definitions of the Sports goods given in various dictionaries to come to conclusion that the playing cards did not fall under the category of sports goods. 9. In order to appreciate the findings of the adjudicating authority, it is necessary to reproduce the notification as related to the issue in hand. Effective rate of duty of 5% for specified goods.- In exercise of the powers conferred by sub-section (1) of section 5A of the Central Excise Act, 1944 (1 of 1944), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby exempts the excisable goods of the description specified in column (3) of the Table below and falling under Chapter, heading, sub-heading or tariff item of the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986), specified in corresponding entry in Column (2) of the said Table, from so much of the duty of excise leviable thereon under the s………………

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Jul 282014
 

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CCE, Salem Versus M/s. KPR. Mills Pvt. Ltd. – Central Excise – CESTAT CHENNAI – Tri – Reversal of cenvat credit – capital goods cleared as such to their sister unit – duty paid on the transaction value, which is less than the depreciated value – scope of the term as such – Held that:- there is merit in the Revenue’s appeal and the respondents are liable to pay the differential duty as confirmed by the adjudicating authority on the depreciated value of the used capital goods cleared as such to their sister unit. Levy of penalty – held that:- Revenue has not put forth any valid grounds on the suppression of facts. – penalty waived – demand of duty and interest confirmed – Decided partly in favor of revenue. – 2014 (7) TMI 984 – CESTAT CHENNAI – TMI – E/737/2006 & E/CO/40430/2014 – FINAL ORDER No. 40405/2014 – Dated:- 18-7-2014 – Shri R. Periasami, J. For the Appellant : Shri M. Ram Mohan Rao, DC (AR), For the Respondent : Shri R. Arumugam, Consultant JUDGEMENT Revenue filed this appeal against the order passed by the Commissioner (Appeals). The issue relates to the clearance of certain capital goods to their sister unit after put into use, on payment of duty on the invoice value instead of depreciated value. The adjudicating authority confirmed differential duty of ₹ 1,07,553/- along with appropriate interest and also imposed equal amount of penalty. The Commissioner (Appeals) allowed the respondents appeal on the ground that the capital goods have been removed as such from the factory of the manufacturer and hence they have to pay an amount equal to the duty of excise which is leviable on the goods on the value determined under Section 4 of the Central Excise Act, 1944 read with Rule 3(4) of Cenvat Credit Rules, 2001, wherein he held that these provisions are not applicable to removal of used capital goods by relying the Tribunals decision in the case of Madura Coats Pvt. Ltd. Vs. CCE – 2005 (190) ELT 450 (Tri.). 2. The Ld. AR on behalf of the Revenue reiterated the grounds of appeal and submits that the lower appellate authority has not considered the Board s Circular F.No. 643/34/2002-Cx dated 01.07.2002 and submits that S. No. 14 of the above circular clearly clarified that in respect of capital goods, depreciation will be as per the provisions of CBEC letter F. No. 495/16/1993-Cus.VI dated 26.05.93. He further submits that the depreciation is specifically mentioned in the above circular and it should understood that it is meant for only to used capital goods. The Ld. AR relied upon the following decisions in this regard. 1. CCE, Salem Vs. M/s. Rogini Mills Ltd. 2011- TIOL-05-HC-MAD-CX 2. CCE, Chandigarh Vs. Raghav Alloys (P) Ltd. 2009 (242) ELT 124 (Tri. Del.) Which was upheld by the Honble High Court of Punjab & Haryana in 2011 (268) ELT 161 (P & H) 3. M/s. Rogini Mills Ltd. Vs. CCE Salem Tribunals F.No. 160.2010 dated 05.02.2010 4. Modernova Plastyles Pvt. Ltd. Vs. CCE, Raigad 2008 (232) ELT 29 (Tri.-LB) 5. CCE, Hyderabad Vs. Navodhaya Plastic Industries Ltd. 2013-TIOL-1773-CESTAT-MAD-LB The Ld. AR submits that the decision of the Hon ble High Court of Madras in the case of CCE, Salem Vs. Rohini Mills Ltd. (supra) discussed the Board s Circular dated 01.07.2002 and CBEC letter dated 26.05.03, and held that used capital goods cleared as such is liable to be assessed on the depreciated value. 3. The Ld. Advocate on behalf of the respondent submits that the Commissioner (Appeals) has rightly allowed their appeal by relying the Tribunal orders in the case of Madura Coats Pvt. Ltd. Vs CCE and Salona Cotspin Ltd. Vs. CCE, Salem. He further submits that Rule 3 (4) is applicable in respect of the capital goods cleared as such and not applicable to the used cenvated capital goods. He relies on the decision of the single Member of this Tribunal in the case of CCE, Coimbatore Vs. L.G. Balakrishnan & Bros. – 2009 (238) ELT 659 (Tri. – Chen.), wherein it has been held that used capital goods are not capital goods as such and no requirement to pay duty on sale of used capital goods. 4. Heard both sides and carefully considered the records. There is no dispute on the fact that the respondent had cleared/transferred the used cenvated capital goods to their sister unit on payment of excise duty on the transaction value, which is less than the depreciated value. The adjudicating authority has arrived the value as per the Central Excise Valuation Rules, 2000, by taking the depreciated value method as per Boards Circular dated 01.07.2002. 5. In this regard the expression Capital Goods cleared as such appearing in Rule 3 (4) (c) of CCR, 2002, has been discussed at length in the Tribunal s decision in the case of CCE, Chandigarh Vs. Raghav Alloys Ltd. (supra), which was upheld by the Hon ble High Court of Punjab & Haryana. Further, the Hon ble High Court of Madras in the case of CCE Vs. Rogini Mills Ltd. (supra), considered the above Tribunals decision (supra) and discussed on two main issues as under:- 1. Whether the expression as such appearing in Rule 3(4)(C) of the Cenvat Credit Rules, 2002 would cover used as well as unused capital goods or not? 2. Whether the assessee is required to reverse credit equivalent to credit taken when used capit………………

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Jul 282014
 

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M/s Alembic Ltd. and M/s Nirayu(P) Ltd. Versus CCE Vadodara-II – Central Excise – CESTAT AHMEDABAD – Tri – Demand of interest – whether appellants herein are required to be saddled with the interest under the provisions of un-amended Section 11AB before 11.05.2001 of the erstwhile Central Excise Act, 1944. – Held that:- the demands which are arising for the clearances prior to 11.5.2001, the interest under section 11AB shall be payable w.e.f. 11.05.2001 if the payments have been made on or after 11.5.2001 and for the clearances effected from 11.05.2001 the interest under section 11AB shall be paid from the date of duty payable on such clearances and we hold accordingly. – 2014 (7) TMI 983 – CESTAT AHMEDABAD – TMI – Appeal No.E/875,876/2007-DB – Order No.A/11366-11367/2014 – Dated:- 16-7-2014 – MR.M.V. RAVINDRAN AND MR. H.K. THAKUR, JJ. For the Appellant : Shri Alok Barthwal, Shri R.K. Jain – Advocates For the Respondent : Dr. Jeetesh Nagori, Addl.Commissioner (AR) JUDGEMENT Per: M.V. Ravindran; 1. These two appeals are directed against the Order-in-Original No. 01//COMMR/VDR-II/MP/2007-08 dt.22.06.2007 and 02/COMR/VDR-II/MP/2007-08 dt. 22.06.2007. Appeal No. E/875/2007 is filed by M/s Darshak Ltd. (Now known as Alembic Ltd.) while Appeal No. E/876/2007 is filed by M/s Nirayu Pvt. Ltd. 2. Since in both the appeals the issue is common, they are being disposed of by a common order. 3. The brief facts that arise for consideration are as under: 3.1 That the Appellant companies are engaged in manufacture of pharmaceutical products falling under chapter 28 and 29 of the schedule to the Central Excise Tariff Act, 1985. 3.2 During the period 01.07.1997 to 31.08.2001 M/s Darshak had sent various inputs and partially processed inputs to M/s Nirayu and M/s Paushak which are their sister concern on returnable gate pass. Further M/s Nirayu had issued invoice for duty amounting to ₹ 13,50,294/- for Platinum material cleared to M/s Darshak Ltd in the past and M/s Darshak availed credit of the same. M/s Darshak was issued show cause notice dt.28.10.2002 proposing demand of duty of ₹ 34,77,285/- on clearance of input as such alleging that the said inputs were not received back by M/s Darshak. It was also proposed to recover cenvat credit amounting to ₹ 8,80,184/- on clearances of input as such for job work not received back by said M/s Darshak. A duty of ₹ 13,50,294/- was further proposed to recover on account of wrong availment of cenvat credit alleging that the said goods were not received by M/s Darshak. It was proposed to appropriate the amounts paid by M/s Darshak against the demand. Penalties were also proposed against M/s Darshak in terms of Section 11AC of the Central Excise Act, 1944 readwith Rule 173Q and Rule 57I/57AH of Central Excise Rules, 1944 and Rule 25 of the Central Excise Rules (No.2), 2001 & Rule 13 (2) of the Cenvat Credit Rules, 2001. Further proposed to charge interest under section 11AB of CE Act, 1944 read with Rule 57I/ 57AH of the erstwhile Central Excise Rules, 1944. 3.3 M/s Nirayu was issued show cause notice F. No. V (CH.28)15-1/OA/2002/5493 dt.30.12.2002, wherein it was proposed to recover an amount of ₹ 2,02,71,180/- not reversed/ paid during the period December 1997 to August 2001 on goods cleared to their sister concern on Returnable gate pass and to appropriate an amount of ₹ 4,34,256/- so paid by the Appellant against the said demand. An amount of ₹ 3,53,268/- was also proposed to be recovered on account of finished goods found to have been excess produced in internal records than the statutory records and it was proposed to adjust the amount of ₹ 3,53,268/- so paid by the Appellant against the demand. It was also proposed to impose penalty under Section 11AC of the Central Excise Act, 1944 read with Rule 173Q and Rule 57I/57AH of Central Excise Rules, 1944 and Rule 25 of the Central Excise Rules (No.2), 2001 & Rule 13 (2) of the Cenvat Credit Rules, 2001. Further proposed to charge interest under section 11AB of Central Excise Act, 1944 read with Rule 57I/ 57AH of the erstwhile Central Excise Rules, 1944. 3.4 The Show Cause Notices were adjudicated vide separate Adjudication Orders dt.25.06.2004. In case of SCN issued to M/s Darshak the demand of ₹ 50,03,165/- was confirmed whereas in case of SCN related to demand on M/s Nirayu a demand of ₹ 1,20,99,486/- was confirmed. The adjudicating authority in both the cases also ordered for interest to be charged as per the provisions of Section 11AB of the Central Excise Act, 1944 read with Rule 57AH of the Central Excise Rules, 1944 and Rule 12 of Cenvat Credit Rules, 2000. He also imposed equivalent amount of penalty under Section 11AC of the Central Excise Act, 1944 readwith Rule 57I, 57AH, Rule 13 of Central Excise Rules, 1944 and CENVAT Credit Rules, 2001/2002. The Adjudicating authority also imposed penalty of ₹ 1,00,000/- each on M/s Nirayu and M/s Paushak under Rule 209A of the Central Excise Rules, 1944/Rule 26 of the Central Excise Rules, 2001 in case of show cause notice issued to M/s Darshak Ltd. In case of SCN issued to M/s Nirayu, a penalty of ₹ 1,00,000/- each was imposed on M/s Darshak, M/s Alembic and M/s Paushak under Rule 209A of the Central Excise Rules, 1944/ Rule 26 of the Central Excise Rules, 2001/2002. 3.5 Aggrieved with the orders dt.25.06.2004 both the Appellants filed appeal before the Tribunal who vide order 12.07.2005 in respect of M/s Darshak Ltd. confirmed demand of ₹ 50,03,165/-, however allowed credit of such duty to the recipient units namely M/s Nirayu and M/s Paushak in respect of inputs received by them. The Tribunal also ruled that the penalty of ₹ 50,03,165/- imposed upon M/s Darshak and of ₹ 1,00,000/- each imposed upon M/s Nirayu and M/s Paushak are unduly harsh in view of the fact that removal of duty paid inputs are accounted for in the private records of the concerned units though not in accordance with the rules. The Tribunal considering the clearance of the goods in contravention of rules thus reduced the penalty amount of M/s Darshak to ₹ 2,00,000/- and on M/s Nirayu and M/s Paushak on ₹ 20,000/- each. 3.6 In respect of case related to M/s Nirayu, the Tribunal while upholding demand also allowed credit of such duty to the recipient units. The Tribunal also ruled that the penalty of ₹ 1,20,99,486/- imposed upon M/s Nirayu and of ₹ 1,00,000/- each imposed upon M/s Darshak, M/s Alembic are excessive and considering the clearance of the goods in contravention of rules thus reduced the penalty amount of M/s Nirayu to ₹ 5,00,000/- and of M/s Darshak, M/s Alembic and M/s Paushak on ₹ 20,000/- each. 3.7 The Appellants filed miscellaneous applications dt.28.09.2005 before the Tribunal for modification of order dt.12.07.2005 on the ground that in the said order, the Tribunal considered it to be too harsh to impose penalty upon them and also allowed the credit to the recipient units thus clearly indicating that the issue was revenue neutral. That it is clear that the bonafide of the Appellant was not disputed by the Tribunal still demand for extended period was confirmed. That the material period involved is from December 97 to August 2001 and interest under section 11AB in such case can be demanded only for the period after 11.05.2001. 3.8 The Tribunal vide order dt.12.02.2007 agreeing with the Appellants that the order has not dealt with the interest issue held that in as much as the demands stands confirmed and the penalties stands reduced by the order of the Tribunal, directed the adjudicating authority to confirm the interest amount in accordance with law. 3.9 The Commissioner vide Order – in Original No.01/COMMR/VDR-II/MP/2007-08 dt.22.06.2007 & Order – in Original No.02/COMMR/ VDR-II/MP/2007-08 dt.22.06.2007 confirmed the interest liability under Section 11AB on the ground that the demand was confirmed against the Appellants under proviso to section 11A (1) upholding the charges of willful suppression of facts and contraventions of provisions of central excise rules with intention to evade payment of duty and keeping in view this legal position the interest is legally chargeable for the period upto 11.05.2001 in terms of section 11AB. 3.10 Both the Appellants aggrieved with the aforesaid Orders have filed the present appeals. 3.11 The Tribunal vide stay order dt.23.082007 ordered for pre-deposit of 50% amount of the interest liability. The Appellants filed application for modification of the stay order on the basis of new/ additional grounds. The Appellants sought permission for introduction of following new grounds: a) Rule 57 I/57AH were not in existence in the statute book when the show cause notices were issued as the said rules have been substituted by rules 57AA to 57AK w.e.f.31/3/2000. b) Section 37 of the Central Excise Act does not vest any power to levy interest in case of denial of modvat credit. c) Whatever payment made by the applicants as duty earned as credit simultaneously and immediately by the receiving units of M/s Alembic group and hence the entire exercise is a revenue neutral one. d) Interest is an appendage or an accessory to the principal w.e.f. 01/04/2000, as per the amended rules 57AC manufacturer has to pay an amount equal to the duty leviable on the inputs. Inasmuch as what has paid is neither duty nor Cenvat Credit, the question of charging interest on such amount under 11AB does not arise. 3.12 The Tribunal vide order dt.22.10.2007 did not find merit in application for modification of stay, however allowed the applications for introduction of additional grounds. 3.13 Vide Order No. M/1112-1113/WZB/AHD/2008 dt.10.10.2008 the issue was referred to the Larger Bench for reference as to whether the interest on duty/cenvat credit demanded by applying proviso to section 11 A or Section 11A read with Cenvat Credit Rules, or under Rule 57 I is payable under section 11AB prior to 11.05.2001. 3.14 the Larger Bench relied upon the judgment of the Honble Gujarat High Court in the case of EXOTIC ASSOCIATES Vs COMMISSIONER OF CENTRAL EXCISE 2010 (252) E.L.T. 49 (Guj.) while answering the reference. It held that the amendment w.e.f. 11.05.01 in Section 11AB has enlarged the scope of the coverage of recovery of interest to all cases wherein the demand has been confirmed by the authorities or has been voluntarily paid by an assessee. The amendment does not wipe out the existing liability to pay interest in respect of cases involving fraud, collision, any wilful mis-statement of facts with intent to evade payment of duty. The amended sub-section 2 of Section 11AB from 11.05.01 only mandates that interest liability cannot be fastened under the amended Section 11AB prior to 11.05.01. 4. The Ld. Counsel appearing for the Appellants has filed written submissions along with the judgments. He would submit that in the present case the facts which need consideration is that Tribunal in its order dt.12.07.2005 while confirming the demand on the Appellant also allowed the credit of such duty to the recipient units which are sister concerns of the Appellant as well as reduced the penalties finding the same to be too harsh in view of the fact that the clearances were recorded in private records. That it held that some penalty are to be imposed for clearances of goods in contravention of rules. The order dt.12.07.2005 clearly shows that the whole issue is revenue neutral and does not falls under the category of cases of evasion of duty on account of fraud, suppression wilfull misstatement so as to invite interest under section 11AB before 11.05.2001. He would further argue that eve………………

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Jul 282014
 

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M/s MEGAFINE PHARMA PVT LTD Versus COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX – Central Excise – CESTAT AHMEDABAD – Tri – Suppression of facts – extended period of limitation – Cenvat Credit – capital goods – goods falling under chapter 84 – doors, false ceiling, compactor for document keeping, sheets for roofing, flooring for finished goods storage area, tube light fittings, etc. – The issue of admissibility of Cenvat Credit on certain items and support structures was the subject matter of litigations between the manufacturers and the department. Conflicting views were being expressed by various courts as claimed by the appellant before the first appellate authority. The issue on admissibility of such items was finally decided by the Larger Bench in the case of M/s. Vandana Global Limited Vs. CCE, Raipur (2010 (4) TMI 133 – CESTAT, NEW DELHI (LB)). In the realm of conflicting interpretations given by various benches of CESTAT and other courts, it cannot be held that there was any suppression / misstatement on the part of the appellant with intention to evade any duty. – extended period cannot be invoked. – Decided in favor of assessee. – 2014 (7) TMI 982 – CESTAT AHMEDABAD – TMI – E/981/2012-SM – A/11378/2014 – Dated:- 11-7-2014 – H K Thakur, J. For the Appellant : Shri R G Sheth, Adv. For the Respondent : Shri K J Kinariwala (A.R.) PER : H K Thakur This appeal has been filed by the appellant with respect to OIA No.CS/113/DMN/VAPI-I/2011-12, dt. 29.11.2011 under which OIO No.VAPI-I/DEMAND/13/2010-11, dt. 15.12.2010 passed by the adjudicating authority was upheld. Under OIO dt. 15.12.2010, a Cenvat Credit of ₹ 3,44,164/- was confirmed against the appellant, alongwith interest, and an equivalent penalty was also imposed upon the appellant under Rule 15 of the Cenvat Credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944. 2. Shri R.G. Sheth (Advocate) appearing on behalf of the appellant argued that the items on which Cenvat Credit has been denied by the lower authorities are classifiable under Chapter 84 and are in the nature of capital goods as defined in Rule 2(a)(A) of the Cenvat Credit Rules, 2004. It was his case that as per the definition of capital goods given in Rule 2(a)(A) of the Cenvat Credit Rules, 2004 the goods mentioned in the Chapters specified in the definition of capital goods, when used in the factory of the manufacturer, are eligible for Cenvat Credit. Ld. Advocate also explained with the help of photographs to justify the use of the disputed items in the construction of a room where specific manufacturing processes are required to be undertaken as per international standards. Ld. Advocate also argued that show cause notice dt. 23.12.2009 is grossly time barred as the demand period is from June 2006 to April 2008. It was his case that the first appellate authority has rejected their claim for Cenvat Credit on the basis of Larger Bench judgment in the case of M/s. Vandana Global Limited Vs. CCE, Raipur [2010 (253) ELT 449 (Tri. LB)]. Ld. Advocate further argued that the ………………

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Jul 282014
 

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Service Tax – Dated:- 28-7-2014 – Whether the amount recovered from the members who opt for membership (with land) towards cost of land and handed over to M/s. Amrutha Estates ………………

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Jul 282014
 

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Service Tax – Dated:- 28-7-2014 – Intellectual property rights for allowed user of its brand name – The minimum guarantee of profit per month ………………

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Jul 282014
 

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Service Tax – Dated:- 28-7-2014 – Just because ₹ 20 has been charged by GMB from M/s. UCL Ltd. under the head wharfage charges and GMB has paid service tax on ………………

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Jul 282014
 

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Customs – Dated:- 28-7-2014 – Warehoused goods – Delay in clearances of cargo cannot be held against the appellant as a willful act to invite damages when ………………

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Jul 282014
 

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VAT and Sales Tax – Dated:- 28-7-2014 – Validity of assessment order – Limitation prescribed under section 39 is as to the “making“ of the assessment and not to “init………………

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Jul 282014
 

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Notification u/s 35AC – Notifies the various institutions Approved by the National Committee. – Income Tax – 2/2014 – Dated:- 21-7-2014 – MINISTRY OF FINANCE (DEPARTMENT OF REVENUE) NOTIFICATION No. 2/2014 New Delhi, the 21st July, 2014 S.O. 1873(E). – In exercise of the powers conferred by sub-section (1) read with clause (b) of the Explanation to Section 35AC of the Income Tax Act, 1961 (43 of 1961), the Central Government, on the recommendations of the National Committee for Promotion of Social and Economic Welfare, hereby notifies the institutions approved by the said National Committee, mentioned in column (2) of the Table below, and approves the eligible projects or schemes specified to be carried on by the said institutions and the estimated cost thereof as mentioned in column (3) of the said Table, and also specifies in the column (4) of the Table the maximum amount of such cost which may be allowed as deduction under the said Section 35AC for the period of approval, namely: – TABLE Sl. No. Name of the Institution Project or scheme and estimated cost thereof Maximum amount of cost to be allowed as deduction under………………

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Jul 282014
 

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To set up a sector specific Special Economic Zone for food processing at Village Chelembra, Taluk Thirurangadi, District Malappuram in the State of Kerala. – SEZ – S.O. 1883(E) – Dated:- 16-7-2014 – MINISTRY OF COMMERCE AND INDUSTRY (Department of Commerce) NOTIFICATION New Delhi, the 16th July, 2014 S.O. 1883(E). – Whereas, M/s. Kerala Industrial Infrastructure Development Corporation had proposed under section 3 of the Special Economic Zones Act, 2005 (28 of 2005), (hereinafter referred to as the said Act) to set up a sector specific Special Economic Zone for food processing at Village Chelembra, Taluk Thirurangadi, District Malappuram in the State of Kerala; And, whereas, the Central Government, in exercise of the powers conferred by sub-section (1) of section 4 of the said Act read with rule 8 of the Special Economic Zone Rules 2006, had notified an area of 12.52 hectares at above Special Economic Zone vide the Ministry of Commerce and Industry Notification Number S.O. 962(E) dated 13th June, 2007; And, whereas, in exercise of the powers conferred by second proviso to sub-section (1) of section 4 of the Special Economic Zones Act, 2005 and in pursuance of rule 8 of the Special Economic Zones Rules, 2006, the Central Government notified an additional area of 0.887 hectares and de-notified an area of 0.887 hectares, with same resultant area 12.52 hectares, vide the Ministry of Commerce and Industry Notification Number S.O. 162(E) dated 10th January, 2013; And, whereas, the sector of the above mentioned SEZ was changed from Food Processing to Agro based Food Processing vide approval letter No. F.2/4/2005-SEZ dated 25th April, 2014; And, whereas, M/s. Kerala Industrial Infrastructure Development Corporation has now proposed for de-notification of 2.17 hectares of the above Special Economic Zone; And, whereas, the Central Government is satisfied that the ………………

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Jul 282014
 

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Income Tax – Dated:- 28-7-2014 – Transfer pricing adjustment – Indenting transactions – commission percentage from AE transactions should b………………

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Jul 282014
 

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M/s THE FREIGHT CENTER Versus COMMISSIONER OF SERVICE TAX – Service Tax – CESTAT AHMEDABAD – Tri – Transport of goods from one airport to another – benefit of Notification No.29/2005-St – transport of export cargo from the airport to airport – Held that:- notification talks about providing of the services in relation to transportation of goods while in the case in hand the issue regarding transportation of goods between two air ports and rendered to another agency i.e. FedEx or as the case may be. Since the issue requires deeper consideration and needs to be appreciated from various documents on record, we find that the appellant has to be put to some condition for hearing and disposing the appeal on merit – appellant has not made out a prima facie strong case for complete waiver of the amounts involved – stay granted partly. – 2014 (7) TMI 981 – CESTAT AHMEDABAD – TMI – ST/11251/2014-DB – M/12914/2014 – Dated:- 17-6-2014 – M V Ravindran And H K Thakur, JJ. For the Appellents : Shri Jigar Shah And Ms Madhu Jain, Advs. For the Respondent : Shri S K Mall, Addl Commissioner (AR) PER : M V Ravindran 1. This Stay Petition is directed for waiver of pre deposit of an amount confirmed as Service Tax liability, interest thereof and penalties. 2. The adjudicating authority has confirmed the demand on the appellant on a finding that on verification of profit & loss account and reconciling the same with ST-3 returns filed by the appellant, it was noticed that there was a short payment of Service Tax liability. Follow-up was done with the appellant by letter dt.30.07.2010 to which the appellant replied stating that the amount which was received were for exempted services which were not liable to Service Tax. Subsequently, the lower authorities recorded the statements of various persons and show cause notice was issued demanding differential Service Tax liability, interest and imposition of penalties and the same was confirmed. 3. Ld. Counsel appearing on behalf of the appellant would take us through the show cause notice and the defences they took before the adjudicating authority. His defence of non-discharge of Service Tax liability is on the ground that the appellant had undertaken an activity of transport of export cargo from the airport to airport i.e. Ahmedabad International Airport to any other airport and does not fall under the category of courier agency services. After taking us through the definition of courier agency as defined under Section 65(33) of Finance Act, 1994, he would submit that the appellant had discharged the Service Tax liability on the services rendered by them wherein door to door transportation of documents/goods was undertaken.He would then submit that Hon'ble High Court of Gujarat has considered the definition of courier agencies in the case of Patel Vishnubhai Kantilal & Co. – 2012 (28) STR 113 (Guj.) and submit that in Para 16 of the said judgment, their Lordships have stated the person should be engaged in door to door transportation of time-sensitive documents, goods or articles to be held as courier service provider. He heavily relies on the said judgment. He would also submit that CBEC in Circular No.341/43/96-TRU, dt.31.10.1996 have clarified that door to door delivery of the goods, articles are services of courier agency services. It is his submission the said CBEC circular needs to be applied in as much as the activity of the appellant is only transportation of goods from airport to airport. It is his further submission that Revenue has demanded the Service Tax under the category of Business Auxiliary Service for the subsequent period in the case of sister concern of the appellant who are engaged in the same line of business. It is his………………

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