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Service Tax - Case Laws
Showing 81 to 100 of 124 Records
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2020 (2) TMI 389 - CESTAT ALLAHABAD
Levy of service tax - Valuation - inclusion of cost of FOC material - Benefit of abatement - Works contracts services through competitive bidding - appellant provided various services to customers like NTPC, NHPC, Nuclear Power Corporation, Power Grid Corporation and some other customers and electricity boards - period covering April 2013 to March 2015 and April 2015 to June 2017 - HELD THAT:- Reliance placed in the case of M/S BHARAT HEAVY ELECTRICALS LTD. VERSUS COMMISSIONER, CENTRAL EXCISE, NOIDA-II [2018 (12) TMI 378 - CESTAT ALLAHABAD] where it was held that Prior the appellant started Civil Construction, Errection or Installation at the agreed site, the equipments to be erected/installed at that site were agreed to be supplied to the appellant vide a separate agreement. This particular fact makes it abundantly clear that property in goods which were to be erected and installed by the appellant had not transferred in his favour at the site of construction and erection.
Appeal allowed.
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2020 (2) TMI 368 - BOMBAY HIGH COURT
Encashment of Bank Guarantee and the Bond - the appeal is being withdrawn, on which bank guarantee and Bond was furnished - HELD THAT:- The issue of discharge of Bank Guarantee and the Bond may be properly determined by the designated Committee itself. Mr. Srivastava states that the applicant will have no serious objection even if the designated Committee orders the encashment of the Bank Guarantee for the purposes of appropriating the amount guaranteed thereby towards the settlement under the said scheme.
At this stage, we leave all these matters to the decision of the designated Committee itself. Based upon the decision of the designated committee, the parties will have liberty to apply to this Court for appropriate orders in relation to the Bank Guarantee and the Bond so furnished - application disposed off.
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2020 (2) TMI 354 - CESTAT CHENNAI
Refund of unutilized input Service Tax credit - denial for want of registration - HELD THAT:- This issue is covered by the decision of the Chennai Bench of the Tribunal, in the appellant’s own case although for a different period, in CST, CHENNAI-III VERSUS M/S. TEMENOS INDIA PVT. LTD. [2018 (4) TMI 1784 - CESTAT CHENNAI] and this Bench, after following the decision of the Hon’ble High Court of Judicature at Madras in the case of COMMISSIONER OF SERVICE TAX-III, CHENNAI VERSUS CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL, CHENNAI & M/S. SCIOINSPIRE CONSULTING SERVICES (INDIA) PVT LTD, CHENNAI [2017 (4) TMI 943 - MADRAS HIGH COURT] has ruled in favour of the assessee - the denial of refund for want of registration of the premises is bad - refund allowed.
Refund claim - denial on the ground of ineligibility/want of nexus - various input services - Gardening Service - Housekeeping Service - Transport Charges - Labour Charges for bore-well - Vehicle Hire Charges - Temenos day expenses - Interior Consultancy - Partition work - Insurance Service - Hotel Expenses - Other rental charges - Electrician and Plumber - Tour Operator Service - Pest Control Service - Car Parking Charges - AMC Charges - External Consultant.
Gardening services - HELD THAT:- This issue was dealt with by the Ahmedabad Bench of the Tribunal in the case of M/s. MURUGAPPA MORGAN THERMAL CERAMICS LTD. VERSUS CCE AHMEDABAD [2013 (4) TMI 384 - CESTAT AHMEDABAD] wherein the Tribunal held that the appellant was required to maintain a garden which is an obligation under the relevant pollution control law and CENVAT Credit with respect to the services used for maintaining the garden would therefore be admissible - refund allowed.
Housekeeping services - HELD THAT:- This issue is covered by the decision of the Delhi Bench of the Tribunal in COMMISSIONER OF CENTRAL EXCISE, DELHI-III VERSUS HERO HONDA MOTORS LTD. [2014 (5) TMI 724 - CESTAT NEW DELHI] wherein the Bench has ruled in favour of the assessee - refund allowed.
Transport charges - HELD THAT:- In COMMR. OF CUS. & C. EX., HYDERABAD-III VERSUS GREY GOLD CEMENTS LTD. [2014 (9) TMI 673 - ANDHRA PRADESH HIGH COURT], the Hon’ble High Court has held that the credit of input service tax on Transportation Charges is proper - refund allowed.
Maintenance Charges – (Labour charges for bore-well, Interior Consultancy, Partition work, Electrician and Plumber) - HELD THAT:- The above services can be comfortably clubbed under ‘Maintenance Charges’ and are covered by the decision of the Bangalore Bench of the Tribunal in KIRLOSKAR SYSTEMS LTD. VERSUS COMMISSIONER OF SERVICE TAX, BANGALORE [2014 (12) TMI 787 - CESTAT BANGALORE] - refund allowed.
Pest control service - HELD THAT:- The service is very much essential for maintaining a healthy atmosphere in the working premises/factory premises and hence, this would be an essential input service - there is direct nexus of this input service with the output service - refund allowed.
Car parking charges - HELD THAT:- The service was held to be an eligible input service by the Mumbai Bench of the Tribunal in PTC SOFTWARE (INDIA) PVT. LTD. VERSUS COMMR OF CENTRAL EXCISE, PUNE-III [2014 (12) TMI 498 - CESTAT MUMBAI] stating that car parking is part of the business premises of the appellant and is a business expenditure - refund allowed.
AMC charges - HELD THAT:- The Bangalore Bench of the Tribunal in the case of ADC INDIA COMMUNICATIONS LTD. VERSUS COMMR. OF C. EX., BANGALORE [2012 (12) TMI 388 - CESTAT, BANGALORE] has held that Annual Maintenance Contract (AMC) has nexus with manufacture of products and also that AMC for computers are used for manifold purposes in connection with manufacture and clearance of products. In view of the above requisite nexus, the Bench held that the assessee was entitled to take credit of the Service Tax paid - refund allowed.
External Consultant service - HELD THAT:- Credit denied on the ground of Incorrect Invoice/Excess Credit, we see no explanation offered by the assessee and hence, the denial of refund is upheld - refund cannot be allowed.
Non-disclosure of CENVAT Credit in the ST-3 returns - HELD THAT:- The appellant had contended that the credits were included in the CENVAT Credit Register, which fact has not at all been denied by the authorities below. In this regard, we find the decision in TARGET CORPORATION INDIA PVT. LTD. VERSUS COMMISSIONER OF CENTRAL TAX, BANGALORE EAST [2019 (10) TMI 1148 - CESTAT BANGALORE] to be very much apt wherein, the co-ordinate Bangalore Bench has inter alia ruled that the denial of refund only on the basis of non-disclosure of CENVAT Credit in ST-3 return was not legally sustainable - refund allowed.
Appeal allowed in part.
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2020 (2) TMI 349 - CESTAT NEW DELHI
Valuation - management, maintenance or repairs or not - activity of providing parking facility in the Malls - whether the Mall owners receive any payment or consideration from the appellant or not - extended period of limitation - HELD THAT:- Section 67(1)(i) clearly stipulates that where the consideration is not wholly or partly consisting of money, it would be such amount in money as, with the addition of service tax charged, is equivalent to the consideration. Further, in Section 67(1)(i) consideration has be taken as the gross amount charged by the service provider. Thus, there is no doubt that the right to collect parking fees given by the mall owners is nothing but a consideration provided to the appellant by the mall owners and the measure of such consideration is the gross income generated through the parking fees.
The learned Counsel for the appellant has sought to repudiate the liability on the impugned activity by contending that they are merely operating the parking area which is different from the service of ‘management maintenance and repairs’. We are not inclined to accept this distinction because as far as the business activity is concerned qua the appellant, it is operation of the parking area but when this activity is examined qua the mall owners they are providing the service of ‘management, maintenance or repairs’ to the mall owners.
Extended period of limitation - HELD THAT:- There was a clear mis-declaration and wilful suppression in as much as the appellant has suppressed the income of parking fees in the relevant returns with an ulterior motive to evade the service tax. They have wilfully designed their mode of operation to evade the service tax - the extended period is invokable in the case.
The levy of service tax on the activity under ‘management, maintenance or repair service’ is upheld - However, the appellant will be entitled to avail Cenvat credit of service tax paid by the service providers and cum duty benefit - The penalties under Section 78 of Finance Act, 1994 need to reworked accordingly - case remanded back to the Adjudicating Authority to re-determine the taxable demand, interest and penalties - appeal allowed partly by way of remand.
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2020 (2) TMI 344 - CESTAT MUMBAI
Refund of service tax - construction of complex service - levy of tax on the said service, ultra vies or not - refund sought following the decision of the Hon'ble High Court of Delhi in SURESH KUMAR BANSAL & ANUJ GOYAL & ORS. VERSUS UNION OF INDIA & ORS. [2016 (6) TMI 192 - DELHI HIGH COURT] declaring that, in the absence of machinery provision for segregation of service component of consideration, the levy would be ultra vires - refund rejected on the ground that the decision of the Hon’ble High Court of Bombay, in MAHARASHTRA CHAMBER OF HOUSING INDUSTRY AND ANOTHER VERSUS UNION OF INDIA AND OTHERS [2012 (1) TMI 98 - BOMBAY HIGH COURT] upholding the validity of the levy including the Explanation inserted in section 65 (105)(zzh) of Finance Act, 1994 by Finance Act, 2010, took precedence over that of any other High Court.
HELD THAT:- It cannot but be noticed that the dispute in re Maharashtra Chamber of Housing Industries arose from the incorporation of a legal fiction to distinguish rendering of service from supply of goods in a composite transaction the taxability of which was, itself, not denied. In re Suresh Kumar Bansal, the approval accorded to the legal fiction by Hon'ble High Court of Bombay was not discarded but its implementability was discarded in the absence of a mechanism, in the statute, for isolating the value of services in a composite transaction. Hence there is no bar on taxation of such composite transaction.
The dispute before the Hon'ble High Court of Delhi was on the inclusion of the tax in the amount charged in the invoice. It was not an appeal against rejection of a refund claim. While specific directions were issued on the handling of tax deposited, if any, the consideration of claim for refund under section 11B of Central Excise Act, was not a part of the document - Their applicability to the scheme of the negative list as well as the eligibility for refund has not been decided upon in the impugned order especially as the claim is not a consequential relief ordered by the Hon'ble High Court but needs examination in the context of section 11B of Central Excise Act, 1944.
The claim for refund is restored for consideration afresh by the original authority to ascertain the eligibility of appellant on the extent to which taxability under the ‘negative list regime’ is impacted - appeal allowed by way of remand.
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2020 (2) TMI 304 - MADRAS HIGH COURT
Reduction in the quantum of penalty imposed u/s 78 - Assessee paid the said short levied service tax only upon the Audit Objection raised in the matter - Section 73(3) and sub-section (4) of the Act - HELD THAT:- The Audit Objection raised by the Audit Officer is also ascertainment of tax by a Central Excise Officer within the meaning of Section 73(3) of the Act and there is no dispute that an Auditor of the Department is also a Central Excise Officer. Therefore, payment of the service tax with interest by the Assessee in the year 2013 itself, of course, not on his own or suo motu but on the basis of the Audit Objection viz., on the basis of the determination by an Auditor of the Department would not take out the case of the Assessee from the ambit and scope of Section 73(3) of the Act. Therefore, the question of imposition of penalty under Section 78 of the Act on the Assessee would not arise in the present case.
Unless the penalty under Section 78 of the Act itself is leviable on the Assessee, there is no question of any reduction of the quantum of penalty to 25% thereof by the learned Tribunal in its discretion. What is not at all leviable, cannot be reduced.
The Assessee is entitled to get the relief in the present case and the Appeal filed by the Assessee deserves to be allowed - the penalty order of original adjudicating Authority as well as that of the learned Tribunal upholding the imposition of penalty under Section 78 of the Act to the extent of 25% both deserve to be set aside - Appeal allowed.
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2020 (2) TMI 299 - MADRAS HIGH COURT
Refund of service tax - Whether the Tribunal was correct in allowing the appeal of the assessee in respect of the part of the refund claim relating to invoices for port services? - HELD THAT:- The learned Tribunal has not discussed the relevant facts relating to grant of refund of the service tax to the Assessee with regard to service provided by M/s.Natvar Parikh Industries to the Assessee. - the learned Tribunal has not decided the real issue arising in the matter as is sought to be canvassed before us by the learned counsel for the Revenue.
The case is remanded for detailed examination - appeal allowed by way of remand.
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2020 (2) TMI 294 - CESTAT NEW DELHI
Classification of services - construction service along with materials (composite contract) - classifiable under ‘works contract service’ or ‘commercial or industrial construction service’? - extended period of limitation - HELD THAT:- The service rendered by the appellant is taxable only and the category of works contract service in view of the law laid down by Hon’ble Supreme Court in Larsen & Toubro [2015 (8) TMI 749 - SUPREME COURT].
Also, the work relating to road construction, even in the premises of NTPC, which may be termed as private road is exempt service as per the definition of works contract service which specifically exempts ‘road service’. There is no distinction made out by the legislature with respect to public road and private road. Further, admittedly, the appellant have paid the service tax under the works contract composition scheme along with the interest. The appellant is entitled to pay tax under the ‘works contract composition scheme’ and once they have discharged the tax liability there is no further liability on them.
Appeal dismissed - decided against Revenue.
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2020 (2) TMI 292 - CESTAT CHENNAI
Photography services - exemption towards value of goods - Benefit of N/N. 12/2003-ST dated 20.06.2003 - allegation is that invoices raised did not specifically indicate the value of the goods and materials sold by the assessee - HELD THAT:- The Adjudicating Authority has categorically found that the invoices furnished by the appellant were not sufficient enough to conclusively establish the value of the goods and materials and hence it was all the more relevant for the assessee to furnish the necessary documentary proof. Therefore, going by the judicial discipline it has to be examined whether the assessee-appellant has successfully discharged the primary burden, with the support of documentary proof.
The appellant has also contended as to its eligibility to Cenvat Credit if service tax was demanded without extending the benefit of Notification No. 12/2003, but however, a perusal of the impugned orders does not reveal any such contentions urged by the appellant and therefore we deem it proper in the interest of justice to remit this issue of verifying the eligibility or otherwise of the appellant to the Cenvat Credit in question, to the file of the adjudicating authority who shall call for such documents as may be necessary in this regard.
Appeal allowed by way of remand.
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2020 (2) TMI 291 - CESTAT CHENNAI
Non-payment of service tax - services of construction of residential units (police quarters to Tamil Nadu Police Housing Corporation) - HELD THAT:- The issue whether the construction of residential units for Tamil Nadu Police Housing Corporation would be subject to levy of service tax was considered by the Tribunal in the case of N. RANGASAMY & CO. VERSUS COMMISSIONER OF CENTRAL EXCISE, SALEM [2019 (2) TMI 690 - CESTAT CHENNAI] where it was held that construction of such quarters for police personnel will fall under exclusion category and would not be exigible to service tax.
Appeal allowed - decided in favor of appellant.
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2020 (2) TMI 285 - CESTAT MUMBAI
Non-payment of service - demand alongwith interest and penalty - HELD THAT:- The appellant has not set out any ground explaining the reason for non-deposit of the service tax with the Government, even though collected from the customers, in providing the taxable service. Therefore, I do not find any reason to interfere with the orders of the authorities below.
Appeal dismissed - decided against appellant.
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2020 (2) TMI 282 - CESTAT AHMEDABAD
Business Support services - activity of purchasing space on ocean going vessels from shipping companies and selling the same to various exporters for export of goods - HELD THAT:- There is no dispute about the activity being carried out by the appellant i.e. they are engaged in purchase and sale of space on ocean going vessels. In the transaction of purchase and sale of space, they earn some profit for the reason that in some cases, the sale price of the space to various exporters is more than the purchase price of the space paid to shipping companies. There is no service involved in such transaction as the purchase and sale of the space is an activity of sale and purchase and hence, not liable to service tax.
This issue has been considered by various judgments time and again and this Tribunal held that since the activity of sale and purchase involves no service hence the profit earned on sale of space is not liable to service tax.
The issue is no longer res-integra and in all the judgments it has been categorically held that any amount charged for space on ocean going vessels, over and above the purchase price is not liable to service tax - Appeal allowed - decided in favor of appellant.
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2020 (2) TMI 231 - ANDHRA PRADESH HIGH COURT
Condonation of delay in filing appeal before the tribunal - sufficient cause for delay or not - Classification of services - Renting of Immovable Property Service or not - Whether sufficient cause is shown for the condonation of delay? - HELD THAT:- The delay deserves to be condoned, in the light of the contentions of the appellant that the reason for the delay is beyond the control of the appellant and that the said reason for the delay is on account of the ill health of the accountant and his leaving the job in June, 2014, without intimation, after having received the copy of the impugned order and placing it in audit file, which is not within the knowledge of the appellant. If the explanation is accepted and an opportunity is provided to have the cause in the proposed appeal decided on merits, the highest that would happen is that the cause would be decided on its merit after hearing the parties and in that view of the matter, it cannot be said that if the delay is condoned after accepting the explanation as a sufficient cause prejudice would be caused to the revenue/respondent herein. While considering the applications for condonation of delay, what is to be seen is whether the interest of revenue will stand protected, even while recognizing the right of the assesse to exercise the statutory remedies available to the assesse and the statutory right of appeal cannot be made redundant by dismissing the application for condonation of delay on technical grounds.
This is a fit case for condonation of delay and affording an opportunity to the appellant to have the intended appeal decided on its merit by the CESTAT. Hence, the impugned order is liable to be set aside and that such a course sub-serves the ends of justice.
Appeal allowed.
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2020 (2) TMI 230 - CESTAT KOLKATA
Refund of service tax - duty paying documents - non-submission of proper document admissible in terms of Notification No.40/2012-ST - HELD THAT:- The benefit of Notification No.40/2012-ST can be availed in either way i.e. the service provider may not tax the amount or the service recipient being SEZ can claim refund - Mere technical discrepancy in the invoices cannot be the ground for denying substantive benefit of refund available to SEZ unit. It is the policy of the Government to exempt or refund the input tax incurred by the SEZ unit.
Regarding re-conciliation of Service Tax payment with evidence of challans, I find that the same was produced before the lower authority and also before me and the same is satisfactory.
The appellant herein is eligible for claiming refund of the Service Tax paid by the service provider which is in consonance with the law - appeal allowed - decided in favor of appellant.
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2020 (2) TMI 229 - CESTAT BANGALORE
SEZ unit - refund in respect of services received for authorized operation by virtue of N/N.12/2013-ST dt. 01/07/2013 - HELD THAT:- The appellant is a SEZ unit and as per Section 26 read with Rule 31 of SEZ Rules, 2006 along with Section 51 of SEZ Act, the SEZ Act has overriding impact over other laws and other SEZ units are exempt from payment of service tax for any service which is used for authorized operations.
The issue is no more res-integra and is decided in the case of MAST GLOBAL BUSINESS SERVICES INDIA PVT LTD VERSUS COMMISSIONER OF CENTRAL TAX, BANGALORE [2018 (9) TMI 258 - CESTAT BANGALORE] where it was held that Keeping in view the intention of the Government in enacting the SEZ Act and giving special fiscal concessions to SEZs, It is held that this is only a procedural and is not a mandatory condition as held by the Commissioner(Appeals).
Further, refunds have been rejected on the ground that some of the services are not covered in the default list of services whereas factually those services are very much covered in the approved list of services issued by the office of the Development Commissioner which has been placed on record. Further, those services which are not specifically approved but the said services are used for authorized operation of the company, appellant still be eligible for the refund in view of the Section 26 and Section 51 of the SEZ Act.
The matter is remanded to the original authority to verify the invoices allegedly not produced before the authorities earlier - Appeal allowed by way of remand.
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2020 (2) TMI 228 - CESTAT BANGALORE
Demand of interest and penalty - irregularly availed CENVAT credit on BCD reversed on being pointed out - HELD THAT:- The appellant had sufficient balance during the relevant period and has not utilized the same. Therefore, in view of the decision of the Hon’ble Karnataka High Court in the case of COMMISSIONER OF CENTRAL EXCISE & SERVICE TAX LARGE TAXPAYER UNIT, BANGALORE VERSUS M/S BILL FORGE PVT LTD, BANGALORE [2011 (4) TMI 969 - KARNATAKA HIGH COURT], the appellant is not liable to pay the interest and the penalty.
CENVAT Credit - input services - insurance of vehicles - HELD THAT:- The vehicle belongs to the company and are used for an activity indirectly in relation to production and therefore by the amendment in the definition of ‘input service’ w.e.f. 01.04.2011, the services used for maintenance of vehicle is not excluded because the same is not used for personal use of a particular person - credit allowed.
CENVAT credit - input services - Outdoor Catering Service and Health Insurance Charges - HELD THAT:- The impugned order is wrong in denying the CENVAT credit of Service Tax paid on Outdoor Catering Service and Health Insurance Charges which had already been allowed in the OIO and the Department did not file any appeal against that nor the appellant has filed appeal before the Commissioner regarding Outdoor Catering Service and Health Insurance Charges - credit allowed.
Appeal allowed - decided in favor of appellant.
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2020 (2) TMI 227 - CESTAT CHANDIGARH
Business Auxiliary Services - appellant-cable T.V. operator, entered into an agreement with M/s Sify Limited, Chennai to provide internet services of M/s Sify Limited through their cable network to their clients - levy of service tax - HELD THAT:- A perusal of various clauses of the agreement would show that the agreement is not in the nature of an agreement between a principal and principal. It is in a nature of an agreement between a principal and an agent. As a principal, M/s Sify Limited is entitled to engage as many several agents as they please in addition to the appellant (para 3.5 of the agreement). On the other hand, as an agent the appellant cannot provide services of other internet service providers through their network (para 3.7 of the agreement). The agreement is for an initial term of 3 years and renewable at Sify’s option for further term of one year each. Either during the initial term or during any renewed term, Sify may, at any time, terminate the agreement without assigning any reason whatsoever after giving 90 days notice. Similar option of termination is not available to the appellant. The appellant collects the revenue on behalf of M/s Sify Limited from the customers and for the services rendered by the appellant, M/s Sify Limited will pay to the appellant 30% of the browsing revenue.
There is nothing in the entire agreement that would suggest that a new joint venture has been formed or a joint venture between the two companies has been established as a business. Nothing in the agreement suggests that the appellant and Sify have an agreement on Principal to Principal basis - in the present case based on the nature of the agreement the appellant is providing services to M/s Sify Limited which fall under the category of business auxiliary service.
Appeal dismissed - decided against appellant.
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2020 (2) TMI 226 - CESTAT BANGALORE
Recovery of interest u/s 87 without issuance of SCN - Delay in payment of service tax - HELD THAT:- In the present case the appellant paid the service tax liability but with delay. Appellants have shown the tax arrears in their returns and subsequently paid the tax due. Subsequently, during the audit, the Department detected that there was a delay and the appellant is liable to pay the interest for the delay in payment of the tax.
The original authority has given the decision in violation of the principles of natural justice and no opportunity whatsoever is given to the appellant to put forth his defense regarding the basis of calculation on which the interest payable is arrived. Further the provisions of Section 73(1B) which was inserted w.e.f. 14/05/2015 is not applicable in the present situation because Section 73(1B) covers situation where self-assessed tax is not paid in part or in full, recovery of such tax with interest can be made by invoking the provisions of Section 87 of the Finance Act, 1994 whereas in the present case there is no dispute regarding the payment of tax and the said payment of tax was paid much before the audit was conducted and there is no demand of tax in the present case. Hence, provisions of Section 73(1B) read with Section 87 are not applicable in the present case.
Applicability of time limitation for demanding of interest - HELD THAT:- In the present case, the demand is made for the period April 2011 to March 2016 by issue of a letter of demand dated 24/08/2017. The Tribunal has dealt with this issue of limitation in various decisions relied upon by the appellant cited supra and it has been consistently held that to demand interest also period of limitation is applicable - in the Master Circular No. 1053/02/2017-CX dated 10/03/2017, the Board has clarified that in case where duty and interest is demanded, it is quite clear that limitation prescribed in Section 11A applies. Further it may be noted that in cases where duty has been paid belatedly and interest has not been paid, interest needs to be demanded and recovered following the due process of demand and adjudication. In such cases, the period of limitation as prescribed in Section 11A applies for demand of interest.
The confirmation of demand of interest without issuing the show-cause notice is not sustainable - period of limitation is applicable as far as demand of interest is concerned - Appeal allowed - decided in favor of appellant.
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2020 (2) TMI 225 - CESTAT BANGALORE
CENVAT Credit - Right of User (ROU)-sharing/leasing of immovable property service - exempted services - Rule 6(3) CENVAT Credit Rules, 2004 - extended period of limitation - HELD THAT:- The demand of ₹ 3,81,152/- on the lease rent amount paid to M/s HPCL during the previous years and got reimbursed in the year 2013-14 is not sustainable because the appellant has paid the Service Tax on gross amount without any deduction of Service Tax and M/s HPCL has deposited the gross Service Tax to the Department without claiming any refund and only adjustment was made on the net amount payable to M/s HPCL. Therefore, the Service Tax Department has been paid with full amount of Service Tax and the demand of Service Tax on refund is not sustainable.
Demand of Service Tax of ₹ 1,03,947/- under Rule 6(3) of CCR, 2004 - HELD THAT:- The appellants have not rendered any exempted service by way of trading, in fact, the appellant had purchased the material during the year 2000 to 2002 and paid the full Excise duty and did not avail any CENVAT credit because at that time transportation service was not under the purview of Service Tax. Moreover, the activity of the appellant is not trading and they are neither manufactures nor trader and full Excise duty has been paid on all the goods purchased by them and no CENVAT credit was availed as output service was not taxable. In view of this, this demand is also not sustainable in law.
Demand of CENVAT credit of ₹ 58,775/- is concerned - HELD THAT:- The Commissioner (A) has rightly disallowed this credit on the grounds that there is an amendment in the definition of “input service’ w.e.f. April 2011.
Input service credit of ₹ 52,875/- availed during January 2014 on input service provided by M/s Barley Person C India Ltd. for pre-feasibility study connected for laying petroleum pipeline from Mangalore to Kannur in Kerala - HELD THAT:- The appellant, during the course of audit, has agreed to reverse the same. Similarly, the CENVAT credit on construction of civil structure is concerned, the appellant availed the CENVAT credit to the extent of ₹ 52,113/- and during the course of audit agreed to reverse the same.
Time limitation - April 2013 to March 2015 - HELD THAT:- The disputed period in this case is April 2013 to March 2015 whereas the SCN was issued on 04.03.2016 alleging suppression of material fact with intent to evade payment of duty. Further, the appellant is a PSU and is maintaining proper books of accounts in which all the transactions are recorded and some discrepancies were found during the course of audit; some of which appellant agreed and reversed ineligible CENVAT credit but with regard to others, the appellant contested the same and thereafter a SCN was issued and adjudication was done - Since all the discrepancies were noticed on the basis of audit, it cannot be alleged that the appellant being a PSU have indulged in suppression of material fact with intent to evade payment of tax. Since suppression cannot be alleged against the appellant, hence invoking the larger period of limitation to confirm the demand is not tenable in law - the entire demand is barred by limitation.
Appeal allowed - decided in favor of appellant.
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2020 (2) TMI 224 - CESTAT MUMBAI
100% EOU - refund of CENVAT Credit - export of services - Rule 5 of the Cenvat Credit Rules, 2004 - denial of benefit of refund in case of some of the input services on the ground that there were no nexus between such disputed input services and the output service exported by the appellant and that the disputed services are not conforming to the definition of the ‘input service’ as per Rule 2(l) of the Cenvat Credit Rules, 2004 - HELD THAT:- Rule 5 of the Cenvat Credit Rules was substituted by Notification No.18/2012-C.E.(N.T.), dated 17.03.2012 (w.e.f. 01.04.2012). Under the said substituted rule, it has been provided that the manufacturer or the service provider has to claim the refund as per the formula prescribed therein. Considering such amendment of Rule 5, the Tax Research Unit of Department of Revenue vide circular dated 16/03/2012 has clarified that the new scheme under Rule 5 does not require the kind of correlation that is needed at present between exports and input services used in such exports. Since the amended rule w.e.f. 01.04.2012 does not provide for establishment of nexus between the input and the output services and the benefit of refund is to be extended only on compliance of the formula prescribed therein, the denial of refund benefit on the ground of non-establishment of nexus cannot be sustained.
Tribunal in the case of M/S MAERSK GLOBAL SERVICES CENTRES (INDIA) PVT. LTD. VERSUS COMMISSIONER OF C.G. ST-NAVI MUMBAI [2019 (10) TMI 959 - CESTAT MUMBAI] has extended the refund benefit on the ground that establishment of nexus between the input and the output services cannot be insisted upon.
Since, correlation between the relevant invoices and the refund application is required to be scrutinized in a proper manner, the matter should be remanded to the original authority for verification of the relevant invoices and other documents for a proper fact finding whether, the refund benefit has been claimed once or twice - the matter is remanded for a limited purpose of verification of the relevant invoices with regard to the allegation of availment of double credit by the appellant.
Appeal allowed by way of remand.
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