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Showing 21 to 40 of 405715 Records
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2024 (4) TMI 1108
Revision u/s 263 - Additions u/s 69 r.w.s. 115BBE - excess stock found during the course of survey as admitted to be the undisclosed business income of the assessee, by the main partner in the assessee firm - AO considering the undisclosed excess stock treated as the business income of the assessee - HELD THAT:- It is not the case of the Department that certain cash / jewellery / other income etc. was found which could be attributed as the business income of the assessee. As per the report by the survey team, the excess stock was a mixed stock and was not separately and clearly identifiable. Therefore, in our considered view, the said undisclosed excess stock should normally presumed to be the business income of the assessee only.
In the case of Veer Enterprises [2024 (1) TMI 1271 - ITAT CHANDIGARH] ITAT held that where during course of survey, assessee surrendered excess stock, cash and receivables and offered same to tax as business income, however, AO treated said surrendered amount as unexplained investment under Sections 69A and 69B, since it emerged that source of income of assessee was from its business operations, income surrendered by assessee during survey could not be brought to tax under deeming provisions of Sections 69A and 69B of the Act.
In the case of Baljinder Kumar. [2023 (8) TMI 289 - ITAT CHANDIGARH] ITAT held that where there are unrecorded sales made by assessee during current financial year and receivables arising out of such unrecorded sales had been offered to tax as additional business income by assessee, such amount could not be brought to tax under Section 69 of the Act. In the case of Parmod Singla 2023 (8) TMI 525 - ITAT CHANDIGARH] ITAT held that mere fact that survey/search proceedings have been initiated at business premises of assessee does not mandate Assessing officer to automatically invoke deeming provisions of Sections 69 and 69A; said provisions can be invoked only where explanation offered by assessee is not found satisfactory; where from explanation offered by assessee it clearly emerged that source of income offered during survey was from his business operations, such income could not be taxed under Sections 69 and 69A of the Act.
Accordingly, as per facts of the assessee’s case, wherein clearly it has been found that excess business stock was found from the premises of the assessee, in our considered view, the order passed by the Assessing Officer considering the undisclosed excess stock as the business income of the assessee, is not erroneous and prejudicial to the interest of the Revenue. Appeal of the assessee is allowed.
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2024 (4) TMI 1107
Sustainability of supplementary Show Cause Notice, prior to insertion of second proviso to Section 124 of the Customs Act, 1962 w.e.f 29.03.2018 - effect to the second proviso to Section 124 of the Customs Act, 1962 which is effective from 29.03.2018 - retrospective or prospective effect? - High Court held that the supplementary show cause notice, although termed as the supplementary, is actually an independent show cause notice even though it relates with the case of smuggling which is also a subject matter of the first show cause notice dated 26.08.2016 - HELD THAT:- We dispose of this special leave petition reserving liberty to the petitioner to raise all contentions with regard to the show cause notice issued by the respondent-department which the High Court has termed as an independent show cause notice in accordance with law.
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2024 (4) TMI 1106
Maintainability of Appeal before CESTAT - Baggage Rules - Interpretation of statute - Smuggling - seizure of foreign currency - legislative edicts manifested in first proviso to section 129A of Customs Act - misreading of the terms ‘goods’ and ‘baggage’ defined in the Customs Act, 1962, to arrogate the jurisdiction - proper interpretation to the expression ‘beneficial owner’ defined in section 2(3A) of the Customs Act, 1962 - High Court held that Once the respondent themselves had asserted that the goods in question were liable to be confiscated in terms of Section 113(d), the objection taken to the maintainability of the appeal would not sustain - HELD THAT:- We are not inclined to interfere in the matter. The Special Leave Petition is hence dismissed. However, any question of law that may arise in this case is kept open.
Pending application(s), if any, shall stand disposed of.
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2024 (4) TMI 1105
Classification of imported goods - import of furnace oil from UAE - to be classified under CTH 27101950 (furnace oil) as declared by the appellant or under CTH 27109900 (waste oil) as alleged by the revenue? - Tribunal held that Since the test report of CRCL Vadodara/Delhi cannot be accepted the declaration made by the appellant in respect of nature of goods, classification and also valuation are found to be absolutely correct - HELD THAT:- We are not inclined to interfere in the matter. The civil appeal is hence dismissed.
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2024 (4) TMI 1104
Review Petition - Condonation of delay of 243 days in filing this appeal - Benefit of exemption from duty - 12V SMPS consisting of Main PCB, lightening protector, DC/AC cables, fuse/fuse holders and others - SMPS is not a part of IFWT - Supreme Court held that the delay is condoned - HELD THAT:- Having carefully gone through the Review Petition, the order under challenge and the papers annexed therewith, we are satisfied that there is no error apparent on the face of the record or any merit in the Review Petition, warranting reconsideration of the order impugned.
The Review Petition is, accordingly, dismissed.
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2024 (4) TMI 1103
Imposition of penalties u/s 114 (iii) and 114A on employees / manager of CHA - benami shipping bills - mis-declaration of the description quantity and value of export consignments in order to avail ineligible drawback - HELD THAT:- The appellant’s submission that he was not aware that the IEC holder was only dummy and Shri Ashok Sharma was the master mind cannot be accepted considering that all documents were received by the appellant Shri Ashok Sharma himself. The appellant’s submission that it was not required to verify the existence of the IEC holder of physically verifying the premises also cannot be accepted in the factual matrix of the case. Had the case been one where the IEC holder had supplied all the documents to the appellant and the appellant filed the shipping bills in good faith, the situation would have been different. However, in this case without the knowledge of the IEC holder, the appellant filed benami shipping bills. The appellant was required verify if the exporter in whose name he was filing the shipping bills was indeed the exporter, and was issued IEC, etc.
The appellant’s submission that he did not abet the commission of any offence u/s 114 (iii) of the Customs Act also cannot be accepted for the reason that the appellant had filed benami shipping bills with mis-declared quantities and values at the behest of Shri Ashok Sharma. It is the discovery of this mis-declaration which rendered the goods liable for confiscation. Therefore, the appellant was liable to penalty u/s 114 (iii) of the Customs Act. The appellant’s contention against the imposition of penalty u/s 114AA of the Customs Act also cannot be accepted for the reason that this section provides for penalty for willfully mis-declaring facts in any declaration before the customs authorities which the appellant did. Considering the value of the goods involved, we do not also find that the penalties imposed were excessive. We, therefore, find no reason to interfere with the order.
Thus, the impugned orders are upheld and all the appeals are dismissed.
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2024 (4) TMI 1102
Imposition Of Penalty - Revocation of the Customs Brokers’ licence - non-existent entities - violation of regulation 10 (n) of the Customs Brokers Licensing Regulations, 2013 - No opportunity to cross examine - violation of the principles of natural justice - HELD THAT:- DGARM did some analysis and came to the conclusion that several GST registrants did not exist and did not operate from their business addresses at all. It is undisputed that their registrations were issued by the very department which initiated the investigation. Thus, the irresistible conclusion is that if the DGARM is correct, then the department issued several benami (pseudonymous) GSTIN registrations to several entities which did not exist at all. Some of these non-existent entities were also filing GST returns with the department.
These allegedly non-existent entities were also issued importer exporter codes (IEC) by the DGFT. Thus, if the DGARM is correct, DGFT had issued benami IECs.
Neither of the documents were enclosed to the SCN or provided to the appellant, let alone giving the appellant an opportunity to cross examine those who sent them. This is clearly a violation of the principles of natural justice and on this ground alone, the impugned order deserves to be set aside.
The onus on the Customs Broker cannot, therefore, extend to verifying that the officers have correctly issued the certificate or registration. Of course, if the Customs Broker comes to know that its client has obtained these certificates through fraud or misrepresentation, nothing prevents it from bringing such details to the notice of Customs officers for their consideration and action as they deem fit. However, the Customs Broker cannot sit in judgment over the certificate or registration issued by a Government officer so long as it is valid. In this case, there is no doubt or evidence that the IEC, the GSTIN and other documents were issued by the officers. So, there is no violation as far as the documents are concerned.
Any of the three methods can be employed by the Customs Broker to establish the identity of his client. It is not necessary that it has to only collect information or launch an investigation. So long as it can find some documents which are independent, reliable and authentic to establish the identity of his client, this obligation is fulfilled. Documents such as GSTIN, IEC and PAN card issued etc., certainly qualify as such documents as none of these departments have any interest in the relationship between the client and the Customs Broker and these documents are presumed to be authentic and reliable having been issued by the Government officers. However, these are not the only documents the Customs Broker could obtain; documents issued by any other officer of the Government or even private parties (so long as they qualify as independent, reliable and authentic) could meet this requirement. While obtaining documents is probably the easiest way of fulfilling this obligation, the Customs broker can also, as an alternative, fulfill this obligation by obtaining data or information. In the factual matrix of this case, we are fully satisfied that the appellant has fulfilled this part of the obligation under Regulation 10(n).
The fourth and the last obligation under Regulation 10(n) requires the Customs Broker to verify the functioning of the client at the declared address using reliable, independent, authentic documents, data or information. This responsibility, again, can be fulfilled using documents or data or information so long as it is reliable, independent and authentic. Nothing in this clause requires the Customs Broker to physically go to the premises of the client to ensure that they are functioning at the premises. Customs formations are only in a few places while exporters or importers could be from any part of the country and they hire the services of the Customs Brokers.
In fact, the entire verification report is based on the GSTIN. Further, IECs issued by the DGFT also show the address. There is nothing on record to show that either of these documents were fake or forged. Therefore, they are authentic and reliable and we have no reason to believe that the officers who issued them were not independent and neither has the Customs Broker any reason to believe that they were not independent.
The responsibility of the Customs Broker under Regulation 10(n) does not include keeping a continuous surveillance on the client to ensure that he continues to operate from that address and has not changed his operations. Therefore, once verification of the address is complete as discussed, if the client moves to a new premises and does not inform the authorities or does not get his documents amended, such act or omission of the client cannot be held against the Customs Broker.
We, therefore, find that the Customs Broker has not failed in discharging his responsibilities under Regulation 10(n). The impugned order is not correct in concluding that despite obtaining and providing authentic documents issued by various Government officers, the Customs Broker has violated Regulation 10(n) because the exporters were found to not exist during subsequent verification by the officers.
Thus, the appeal is allowed and the impugned order is set aside with consequential relief to the appellant.
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2024 (4) TMI 1101
Validity Of Order in original passed by the Commissioner - Demand - Penalty - Import of Internal Remote Electrical Tilt Switches (iRET) - benefit of Exemption notification no. 50/2017-Cus - Whether the amperage of the iRETs imported by the appellant were of 5 Amps as declared in the Bills of Entry or were of less than 5 Amps as now asserted by the appellant relying on the aforesaid documents - HELD THAT:- The Commissioner has also wrongly declined to accept the test report of a government laboratory of another Ministry which certifies the amperage of the iRETs of the two models which were imported. The Commissioner has also declined to accept the clarificatory letter from the overseas supplier that due to a typographical error ‘<’ was not typed in all the invoices although the letter also clarifies that the actual amperage was 1.3 amperes. The logic of the Commissioner in declining to accept the letter of the supplier is that the supplier can only supply goods which are in its inventory and invoices are issued accordingly and he cannot now claim to have supplied iRETs of a different amperage. In our considered view, the Commissioner has gravely erred in not accepting the clarification from the supplier when it is consistent with the technical specifications in the product brochure and also consistent with a test report from a Government laboratory. If the supplier contended that a typographical error was committed in preparing the invoices and this assertion is supported by the product brochures, it was incorrect for the Commissioner to have rejected the clarification.
As the product brochures, the test reports and the letter from the supplier all confirm that the iRETs which were imported were of less than 5 amperes, it is not necessary for us to examine the other evidence adduced by the appellant. Clearly, there was a typographical error in the Bills of Entry and the invoices which has resulted in the audit objection, the SCN and the impugned order.
There is a discrepancy between what is stated to have been imported in the documents and the Bill of Entry and what is actually imported, duty can be charged on what is actually imported and not on what is said to have been imported. For instance, if 80 MT of goods are said to have been imported in the Bill of Entry and actually 100 MT of goods are imported, duty has to be charged on 100 MT and not on 80 MT. Similarly, if silver is declared to have been imported and actually gold is imported, duty has to be charged on gold and not on silver.
In this case, if the Bill of Entry, invoice, packing list, etc. mention 5 amperes but there is no dispute that the goods were of particular models and the product literature as well as the test reports show that they are of less than 5 amperes, it is not open to the department to charge duty treating the goods as of 5 amperes merely because the Bill of Entry and other documents say so due to a typographical error.
Thus, the appeal is allowed and the impugned order is set aside with consequential relief to the appellant.
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2024 (4) TMI 1100
Smuggling - Prohibited goods - confiscation of cigarettes containers concealed in HDPE granules - Penalty u/s 112 (a) &(b) and 114AA - seeking return of the goods or return of the market value of the goods - Validity of SCN issued by DRI - demand duty - HELD THAT:- The cigarettes were not mentioned in the Bill of Entry or Bill of Lading and therefore, were also not in the Import General Manifest (IGM) filed by the Shipping Line. The Shipping Line files the IGM based on the Bills of Lading and the goods which the containers are “said to contain” because the Shipping Line has no way of knowing what is actually in the containers. What was declared by the appellants was HDPE granules and the cigarettes were not declared. Therefore, the cigarettes were squarely covered by section 111(f) and are liable to confiscation under that clause. They have also not been indicated in the Bill of Entry and therefore, they are also liable to confiscation u/s 111(l). They do not correspond to the declaration made in the Bill of Entry and therefore, they are also liable to confiscation u/s 111(m). Therefore, the confiscation of the cigarettes under sections 111(f), (l) and (m) need to be upheld. Since the cigarettes are prohibited goods and are certainly harmful to the society being not as per the statutory requirement of health warnings in India, the Commissioner was correct in absolutely confiscating them and not giving an option of redemption.
HDPE granules imported and declared were used to conceal the cigarettes smuggled in the containers. Therefore, they are liable to confiscation u/s 119. However, as they are not prohibited goods, the Commissioner gave an option of redemption u/s 125. We find this part of the order to be fair and balanced requiring no interference.
The cigarettes were liable to confiscation and therefore all persons whose acts or omissions rendered them liable to confiscation are liable to penalty u/s 112. Ajay, Parshottam and Gagan are admittedly, and even according to the appeals filed before us, are the importers of the goods (both the cigarettes and the HDPE granules). Therefore, penalties on them u/s 112 need to be upheld. The quantum of penalty imposed is also proportionate to their offence. Section 112 provides for a penalty not exceeding the value of the prohibited goods.
The value of the cigarettes was Rs. 1,22, 03,500/- and the penalty imposed on Ajay, Parshottam and Gagan was Rs. 15,00,000/- each which is only about 12% of the value of the prohibited goods. Considering the gravity of the offence of smuggling such large quantity of cigarettes which would cause great damage to the health of the people, we find that the quantum of penalty was very balanced and certainly not excessive.
As far as the CHA, M/s. Guha Sarkar and Co. and its employee Shri Sunil Dixit are concerned, they filed the benami Bill of Entry at the behest of Ajay, Parshottam and Gagan in the name of R S Imports and Exports thereby facilitating the smuggling of the cigarettes. Therefore, they are squarely covered by section 112. A perusal of the appeal of these two appellants before us shows that they played an active part and it is not that the Bills of Entry were filed carelessly. Both Guha Sarkar and Co and Sunil Dixit have prayed for the goods to be released and return of the goods- essentially the same as the prayer of Ajay, Parshottam and Gagan. It is not their case that they had nothing to do with the imports and their failing was merely carelessly filing the Bill of Entry. The penalty of Rs. 5,00,000/- each imposed on Guha Sarkar and Co. and on Sunil Dixit in the impugned order u/s 112 is quite mild considering their role and the gravity of the offence. This does not call for any interference or reduction.
Penalty u/s 114AA can be imposed if any person knowingly and willingly makes a wrong declaration. Ajay, Parshottam and Gagan as the admittedly de-facto importers and S Guha Sarkar & Co. and Sunil as the CHA and its employee have deliberately filed the Bill of Entry in the name of R S Import & Export when the actual importers were Ajay, Parshottam and Gagan. They have also not declared the true nature of the goods imported and smuggled in cigarettes.
We have no hesitation in holding that all the five appellants are squarely covered by section 114AA. The maximum penalty imposable under this section is five times the value of the goods. The value of the smuggled cigarettes was Rs.1,22,03,500/- and the penalties imposed on Ajay, Parshottam and Gagan under this section is Rs. 20,00,000/- each and the penalty imposed on Guha Sarkar and Co. and Sunil Dixit is Rs. 5,00,000/-. We find these penalties to be balanced considering the gravity of the offence. These also call for no interference.
Thus, we uphold the impugned order insofar as these five appellants are concerned and dismiss all five appeals.
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2024 (4) TMI 1099
Revocation of Customs Brokers’ licence - forfeiture of security deposit and penalty - violation of regulation 10 (n) of the Customs Brokers Licensing Regulations, 2013? - non-existent entities have also been filing GST returns with the department - HELD THAT:- We have considered the submissions on both sides. DGARM did some analysis and came to the conclusion that several GST registrants did not exist and did not operate from their business addresses at all. It is undisputed that their registrations were issued by the very department which initiated the investigation. Thus, the irresistible conclusion is that if the DGARM is correct, then the department issued several benami (pseudonymous) GSTIN registrations to several entities which did not exist at all. Some of these non-existent entities have also been filing GST returns with the department.
These allegedly non-existent entities were also issued IEC by the DGFT. Thus, if the DGARM is correct, DGFT had issued benami IECs.
Even taking the reports at their face value, they do not show that the exporters never existed or had not existed at the time exports had taken place. There was no basis to draw such a conclusion, let alone, extrapolate it to conclude that the appellant had not fulfilled its obligations under Regulation 10(n).
Any of the three methods can be employed by the Customs Broker to establish the identity of his client. It is not necessary that it has to only collect information or launch an investigation. So long as it can find some documents which are independent, reliable and authentic to establish the identity of his client, this obligation is fulfilled. Documents such as GSTIN, IEC and PAN card issued etc., certainly qualify as such documents as none of these departments have any interest in the relationship between the client and the Customs Broker and these documents are presumed to be authentic and reliable having been issued by the Government officers. However, these are not the only documents the Customs Broker could obtain; documents issued by any other officer of the Government or even private parties (so long as they qualify as independent, reliable and authentic) could meet this requirement. While obtaining documents is probably the easiest way of fulfilling this obligation, the Customs broker can also, as an alternative, fulfill this obligation by obtaining data or information. In the factual matrix of this case, we are fully satisfied that the appellant has fulfilled this part of the obligation under Regulation 10(n).
The fourth and the last obligation under Regulation 10(n) requires the Customs Broker to verify the functioning of the client at the declared address using reliable, independent, authentic documents, data or information. This responsibility, again, can be fulfilled using documents or data or information so long as it is reliable, independent and authentic. Nothing in this clause requires the Customs Broker to physically go to the premises of the client to ensure that they are functioning at the premises. Customs formations are only in a few places while exporters or importers could be from any part of the country and they hire the services of the Customs Brokers. Besides the fact that no such obligation is in Regulation 10(n), it will be extremely difficult, if not, totally impossible, for the Customs Broker to physically visit the premises of each of its clients for verification.
In the factual matrix of this case, we find that the GSTIN issued by the officers of CBIC itself shows the address of the client and the authenticity of the GSTIN is not in doubt. In fact, the entire verification report is based on the GSTIN. Further, IECs issued by the DGFT also show the address. There is nothing on record to show that either of these documents were fake or forged. Therefore, they are authentic and reliable and we have no reason to believe that the officers who issued them were not independent and neither has the Customs Broker any reason to believe that they were not independent.
The responsibility of the Customs Broker under Regulation 10(n) does not include keeping a continuous surveillance on the client to ensure that he continues to operate from that address and has not changed his operations. Therefore, once verification of the address is complete as discussed in the above paragraph, if the client moves to a new premises and does not inform the authorities or does not get his documents amended, such act or omission of the client cannot be held against the Customs Broker.
We, therefore, find that the Customs Broker did not fail in discharging its responsibilities under Regulation 10(n). The impugned order is not correct in concluding that the Customs Broker has violated Regulation 10(n) because the exporters were found to not exist during subsequent verification by the officers.
Thus, the appeal is allowed and the impugned order dated 16.06.2021 passed by the Commissioner is set aside with consequential relief to the appellant.
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2024 (4) TMI 1098
Rejection of request of the appellant for conversion of free shipping bills to drawback shipping bills - Section 149 of the Customs Act, 1962 - HELD THAT:- N/N. 39/2003-C.E.(N.T.) allows drawback on petroleum products. The appellant has exported petroleum products to M/s. Nepal Oil Corporation and hence, they are eligible for the benefit of duty drawback as provided in the aforesaid Notification. The appellant could not claim the drawback benefit because they had not filed the drawback shipping bill at the time of export. The appellant has filed applications dated 12.08.2004 and 24.04.2007 requesting for conversion of their free shipping bills to drawback shipping bills. When their request was not considered, they approached the Tribunal and this Tribunal vide Final Order No. FO/75188/2016 dated 17.02.2016 [2016 (3) TMI 889 - CESTAT KOLKATA] has categorically directed the adjudicating authority to allow the conversion of free shipping bill into drawback shipping bill subject to the satisfaction of the conditions stipulation in Section 149 of the Customs Act, 1962.
The Tribunal in the Final Order dated 17.02.2016 [2016 (3) TMI 889 - CESTAT KOLKATA] has categorically directed the proper officer to allow conversion of the free shipping bills to drawback shipping bills in terms of Section 149 of the Customs Act independent of the C.B.E.C. Circular dated 16.01.2004. It is observed that the ld. adjudicating authority in the impugned order has rejected their applications for conversion on the grounds which are not there in Section 149. Since the appellant has all the documents necessary for considering the amendment, under Section 149 of the Act, the impugned order denying the request for conversion of free shipping bills to drawback shipping bills is legally not sustainable. In view of the above, the impugned order is set aside and the conversion of the free shipping bills to drawback shipping bills is allowed.
The impugned order is set aside - appeal allowed.
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2024 (4) TMI 1097
Seizure of plastic granules - Valuation - Confiscation of the vehicle - payment of redemption fine - Penalty - Interception and seizure of a truck carrying plastic scrap and granules allegedly of Nepalese origin. - HELD THAT:- In respect of the plastic scrap seized valued at Rs.2,16,180/-, I find that the documentary evidence clarifies that the Appellant had imported the 11,000 kgs. on 15.06.2016 vide Bill of Entry No.5638434, which is also affirmed by the Asstt. Commissioner and the invoice raised by them is for 10,000 kgs., whereas, the goods in question were weighted at 9388 kgs.. Reading together all these documents, I find that enough evidence has been provided by the Appellant to the effect that these are not procured illegally from Nepal, but are legally procured goods. Therefore, I set aside the confiscation order and the redemption fine of Rs.50,000/- imposed on the scrap valued at Rs.2,16,180/-. The Revenue is directed to release the plastic scrap to the Appellant forthwith.
So far as the penalty of Rs.14,854/- imposed on Shri Bindeshwari Poddar is concerned, I find that in respect of plastic scrap, there is no case made out against the Appellant. However, in case of plastic granules, the Appellant though initially has not claimed the ownership, but has come forward to redeem the same on payment of redemption fine and the relevant payment of the relevant Customs duty. Based on these facts, the penalty of Rs.14,854/- is reduced to Rs.5,000/- (Rupees Five Thousand only).
The Appellant has made a Security Deposit of Rs.64,854/-. This amount should be utilized to appropriate the redemption fine of Rs.20,000/- in respect of granules and the penalty imposed on Shri Bindeshwari Poddar and against the balance Customs duty and interest to be paid by the Appellant.
The Appeal is disposed of thus.
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2024 (4) TMI 1096
Correctness of Resolution plan - fair and equitable distribution or not - resolution plan failed to make any provision for the operational creditors - Nil Payment to Operational Creditors - waterfall mechanism - HELD THAT:- The resolution plan has been approved by 100% voting by the CoC. It is well settled that the commercial wisdom of the CoC is unjusticiable. Moreover, the liquidation value of the operational creditors is NIL and the amount which has been distributed to the CD in accordance with Section 53(1) shall have to be Nil as well, therefore, the resolution plan is not in violation of Section 30(2)(b) of the Code.
Moreover, admitted claim regarding the financial creditors is to the tune of Rs. 12067,57,69,383 and amount provided under the plan is Rs. 2500 Cr. which is to the tune of 20.098%, therefore, all the other creditors including unsecured financial creditors and operational creditors have been provided NIL.
There are no error in the impugned order having been passed in respect of the applications filed by the Appellants, therefore, the appeal is found to be without any merit and the same is hereby dismissed.
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2024 (4) TMI 1095
Rejection of review petition - Exemption from Service tax - governmental authority - educational institutions - Indian Institute of Technology, Patna (IIT Patna) - National Institute of Technology, Rourkela (NIT Rourkela) - covered by Mega Service Tax Exemption Notification No. 25/2012, G.S.R 467(E) dated 20th June, 2012 or not - it was held by SC that in the present case, the word “or” between sub-clauses (i) and (ii) indicates the independent and disjunctive nature of sub-clause (i), meaning thereby that “or” used after sub-clause (i) cannot be interpreted as “and” so as to tie it with the condition enumerated in the long line of clause 2(s) which is applicable only to sub-clause (ii).
HELD THAT:- No case for review of the judgment dated 13.10.2023 is made out - The review petition is accordingly dismissed.
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2024 (4) TMI 1094
Extended period of limitation - suppression of facts or not - Recovery of service tax - wrongful claiming of value of reimbursement (pure agent) - HELD THAT:- The Order-in-Original is observed to be silent about these allegations/observations in the show cause notice though the extended period is held to be invocable. These allegations also have factual basis which need appreciation of the returns and other related documents. Hence it is not deemed appropriate to decide the plea of limitation without appreciation of the documentary evidence which has been produced by the appellant at this stage before the Tribunal. The said documents need to be appreciated by the original adjudicating authority itself. Both the parties otherwise have acknowledged consents for remanding back the matter.
It is deemed proper that the original adjudicating authority shall decide the show cause notice afresh after giving the appropriate findings with respect to the allegations of suppression and misrepresentation and thus about the invocation of extended period of limitation.
Appeal allowed by way of remand.
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2024 (4) TMI 1093
Maintainability of SLP - petitioners do not press this special leave petition and they intend to file a Review Petition before the High Court - not given scope to participate in the hearing - violation of principles of natural justice - it was held by High Court that if the authority did not follow the direction of the CESTAT, there is gross laches on the part of the authority in passing the order. Had the petitioners brought the fact to the notice of the CESTAT with regard to laches of the authority, in that event the CESTAT could have considered the same. Without doing so, the petitioners having approached this Court, the writ petition is not maintainable.
HELD THAT:- The special leave petition is dismissed as not pressed with the aforesaid liberty - In the alternative, liberty is also reserved to the petitioners herein to file an appeal before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) within a period of one month from today.
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2024 (4) TMI 1092
Maintainability of review petition - time limitation - Process amounting to manufacture - purchase of duty paid chassis and undertaking body building activity - motor vehicles described in sub-headings 8702.10 and 8702.90 of Heading 87.02 - the SC held that given the structure of the statute which clearly comprehends Entry 87.02 [by specifically referring to Headings 8702.10 and 8702.90); that the activity carried on by the appellant results in a finished product i.e. useable buses, the appellant’s contention that fabrication does not amount to manufacture, does not merit consideration.
HELD THAT:- There is an inordinate delay of 389, 390 and 389 days, respectively, in filing the present review petitions - there are no good ground and reason to review the order dated 11.01.2023.
The review petitions are dismissed on the ground of delay, as well as, on merits.
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2024 (4) TMI 1091
Recovery of differential Central Excise Duty - Clearance of subsidized SSP under concessional rate of duty - Violations of the conditions of the Exemption Notification - entire production was meant for agriculture use only and it was explicitly mentioned so on every pack - case of the revenue is that after the SSP was removed and sold to IPL, IPL further sold it to Mahadhan who, further sold it to Hindustan who misused the SSP for agriculture use to manufacture other products in their industry - HELD THAT:- The diversion of SSP meant for and clearly marked as meant for agriculture use to non-agricultural use was done by Hindustan alone. It is undisputed that all bags of SSP were clearly “meant for agriculture use only”. Such being the case, there was absolutely no reason for Hindustan to have put the subsidized SSP cleared under concessional rate of excise duty and intended for agricultural use to industrial use.
The submission of Hindustan in its appeal that the SSP, which it purchased, was of sub-standard quality holds no water. As rightly pointed out by the lower authorities the Fertilizer Control Order 1994 clearly requires marking of fertilizer meant for agriculture use and non-agriculture use. There is nothing in the records to substantiate the appellant’s claim that the SSP sold by Manglam to IPL and IPL to Mahadhan and further by Mahadhan to Hindustan was of sub-standard quality unfit for agricultural use. Clearly, by diverting the fertilizer meant for agriculture use to other use, Hindustan was responsible for evasion of excise duty. In fact, Manglam and IPL could not have foreseen this diversion by Hindustan.
There are no justification to set aside the confiscation of the seized 33 MT of SSP or to set aside the imposition of 50,000/- redemption fine in lieu of confiscation. There are no justification to modify penalty of Rs. 20,000/- under rule 26 imposed on Hindustan by the Commissioner (Appeals).
Appeal allowed.
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2024 (4) TMI 1090
Short payment of Excise Duty - clearance of rough marble slabs - less quantity has been shown by the appellant by way of adopting the incorrect formula for converting the quantity of square feet (Sq. Ft.) of rough marble slabs into Square Meter (Sq. Mtr.) - suppression of facts - invocation of Extended period of Limitation - HELD THAT:- The appellant is admittedly a manufacturer of marble slabs out of the marble blocks. Thus it is clear that appellant is converting irregularly shaped rough marbles into the marble slabs of specific length, breadth and width. The area of slabs with specific dimensions can readily be calculated into Square Feet/ Sqr. Meters. However for the rough block/irregular shaped marble it is only the volume in cubic meters which can be ascertained to some extent of precision.
It is appellant’s case that the production quantity of marble slabs has been calculated by adopting the aforesaid option given - it cannot be denied by the reasonable prudence that once a particular volume of marble block will be converted into slabs of different thicknesses, the area in Sq. Ft./Sq. Mtr. For the slab having more thickness will be less. From the given standards it can be judicially noticed that the area for a slab of 16 mm thickness shall be 175 Sq Ft. per ton of the marble whereas for 18 mm Thick slab it will be 165 Sq, Ft. per ton and for 20 mm thickness slab it will be 150 Sq. Ft. per Ton.
There are no basis of the formula as has been impressed upon by ld. D.R. On the contrary the formula admittedly applied by the appellant is the formula as mentioned in the Central Excise Tariff. No evidence is produced by the department to even demonstrate as to how the formula has wrongly been applied. In the absence of the evidence, the said calculation cannot be held to be a wrong calculation.
Extended period of Limitation - the only ground taken for the same is that the right quantity was not mentioned in the ER-1 Returns and had no audit would be conducted the short-payment by the appellant would not have come to the notice of the department - HELD THAT:- It is a matter of fact that all details were available in the records of appellant whatever was mentioned by the appellant in the ER-1 Returns was as per their records maintained by applying the formula given in the Tariff Act. It is opined that the above all mere oral allegations. There is no evidence to prove that the intent of the appellant was to evade duty. Admittedly the appellant as per selfassessment has discharged his duty liability. The returns have also been furnished. It was now for the Department to scrutinize the returns and to ascertain if the service tax had been paid correctly or not.
Mere omission is not sufficient to be called as suppression of facts to invoke the extended period. Department has to prove that the act was deliberate to not to pay or to short pay the duty - there is no evidence for the same - thus, even extended period has wrongly been invoked. Resultantly, the Show Cause Notice itself is barred by time.
The demand under challenge does not sustain on its merits. It also stands hit by the bar of limitation. Hence the demand is held to have wrongly been confirmed. The order under challenge is therefore set aside - Appeal allowed.
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2024 (4) TMI 1089
100% EOU - Clandestine removal - penalty u/r 26(1) of Central Excise Rules, 2002 - entire charge based on the statement of the appellant - retraction of statements - violation of principles of natural justice - HELD THAT:- The adjudicating authority has not whispered anything with regard to the affidavit filed by the appellant. Moreover, in the event of giving affidavit by the appellant, the adjudicating authority should have conducted examination-in-chief in terms of Section 9D of Central Excise Act and thereafter only the statement could have been relied upon as an evidence but the adjudicating authority has neither made any comment on the affidavit filed by appellant nor conducted any examination-in-chief. Therefore, there is a gross violation of principles of natural justice in this case.
Accordingly, the matter needs to be reconsidered, limited to the imposition of penalty under Rule 26 on the present appellant.
The matter is remanded to the Adjudicating authority for passing a fresh order, after compliance of principles of natural justice.
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