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Service Tax - Case Laws
Showing 61 to 71 of 71 Records
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2022 (5) TMI 202 - DELHI HIGH COURT
Levy of service tax - If service tax was not leviable by the respondent during the relevant period, should not the money be returned to the flat buyers, if they are identifiable? - HELD THAT:- This aspect of the matter has not been examined by the Tribunal.
Issue notice - List the matter on 23.05.2022.
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2022 (5) TMI 144 - GUJARAT HIGH COURT
Validity and legality of FORM SVLDRS 3 - cleaning services - period between 16.06.2005 and 31.03.2008 - demand of service tax alongwith interest and penalty - grievance is that despite the fact that 50% amount towards the predeposit had already been made, the Committee constituted for the purpose of looking into the claim under the Scheme while issuing the SVLDRS 3 granted deduction of Rs. 20,11,712 /- only and the balance amount of Rs. 21,60,023 /- was shown as payable which appears to be on the count that the writ applicant has not made payment of such amount.
HELD THAT:- When the Tribunal itself has recorded in its order dated 14.03.2011, that out of the total confirmed duty of Rs.83,43,470/-, the appellant i.e. the writ applicant herein has already deposited an amount of Rs.49,33,521/- along with interest of Rs.3,93,178/-, then what further objection the Committee could have had for the purpose of processing the application filed by the writ applicant.
The Committee should once again look into the aforesaid aspect, more particularly, the order passed by the Tribunal itself and thereafter, proceed further in accordance with law.
Let the aforesaid exercise be undertaken within 8 weeks from the date of receipt of writ of this order.
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2022 (5) TMI 143 - GUJARAT HIGH COURT
Refund claim - time limitation - claim was delayed by a period of 4 days - Constitutional Validity of clause 3(g) of Notification No. 41/2012-ST dated 29.6.2012 along with Explanation thereto - ultra-vires Section 83 of the Finance Act read with Section 11B of the Excise Act or not - period of limitation for the purpose of filing refund application under the Finance Act in case of export of goods through air or sea - HELD THAT:- The refund application is to be filed within one year from the ‘relevant date’ and the expression ‘relevant date’ in the context of export by sea or air is defined as the date on which the ship or the aircraft in which the goods are loaded leaves India. It is to be further noted that as per clause (A) of the Explanation, refund includes rebate.
Explanation to clause 3(g) of the Notification states that the date of export shall be the date on which the proper officer of the Customs makes an order permitting the clearance and loading of the goods for exportation under Section 51 of the Customs Act. Hence, as per the Notification, the refund claim is to be filed within one year from passing of the order permitting the clearance and loading of the goods for exportation under Section 51 of the Customs Act. Such prescription of limitation is in direct conflict with the statutory provision, i.e. Section 11B of the Excise Act, which provides for limitation to commence from the date when the ship leaves India.
Since the acknowledgment of the refund application was given on 18.2.2014, i.e. within one year from the date when the ship left India, i.e. on 20.2.2013, such refund application being within the period of limitation as stipulated under Section 11B of the Excise Act could not have been rejected as being barred by limitation.
In any case, once it is held that the impugned clause 3(g) and the Explanation thereto of the Notification No.41/2012-ST dated 29.6.2012 is ultra vires Section 83 of the Finance Act read with Section 11B of the Excise Act, the impugned orders rejecting the refund on the ground of limitation cannot be sustained.
The impugned clause 3(g) of the Notification No.41/2012-ST dated 29.6.2012 along with the Explanation is declared as being ultra vires Section 83 of the Finance Act read with Section 11B of the Excise Act - Application disposed off.
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2022 (5) TMI 142 - CESTAT HYDERABAD
Levy of service tax - entire construction activity is sub-contracted - appellant not undertaking any construction by themselves - whether the Appellant is liable to pay Service Tax under complex service prior to 1.6.2007? - HELD THAT:- As per decision of the Hon’ble Supreme Court in COMMISSIONER, CENTRAL EXCISE & CUSTOMS VERSUS M/S LARSEN & TOUBRO LTD. AND OTHERS [2015 (8) TMI 749 - SUPREME COURT] held that composite contracts involving transfer of property in goods is not liable to Service Tax prior to 1.6.2007.
Thus, the law on this point is well settled. Though the said grounds were not raised in the Show Cause Notice or in the impugned order, since the decision of the Hon’ble Supreme Court is binding on this Tribunal it cannot be held that the Appellant was liable to pay Service Tax. Hence, the finding of the Commissioner that the Appellant was not liable to pay Service Tax during the relevant period i.e. from April 2005 to March 2007, is upheld.
Once the Appellant is not liable to pay Service Tax, they are also not entitled to avail cenvat credit of the amount collected in the name of Service Tax and is liable to be paid to the Government Exchequer.
Applicability of provisions of Section 11D - HELD THAT:- The present case is one where tax was collected even though the activity was liable to tax. Only sub-section (1A) of Section 11D covers such a situation and this sub-section was introduced only in 2008 - The present case is not covered under Sub-section (1) which deals with collection of an amount of tax in excess of the liability - the demand under Section 11D for the period upto 17.04.2006 is set aside.
Demand under Section 73A(2) for the period after 18.04.2006 is upheld - The demand of interest under Section 73B is set aside - The imposition of penalty under Section 77 (2) set aside - The demand towards ineligible credit is confirmed and the amount reversed as payment of Service Tax will be treated as reversal - The demand of Service Tax of Rs.17,85,000 on import of service, along with interest and imposition of penalty are set aside.
Appeal allowed in part.
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2022 (5) TMI 141 - CESTAT HYDERABAD
Valuation - amount of withhold tax paid by the Appellant, over and above the consideration paid to the foreign service providers, to be included in the assessable value or not - import of services - reverse charge mechanism - period from May 2006 to March 2010 - recovery of CENVAT Credit on various input services availed in connection with the construction of the hotel.
Service Tax liability on the withholding tax component - HELD THAT:- It is true that, the issue is covered in favour of the Appellant in various decisions relied upon by the learned counsel for the Appellant. However, it is observed that, the issue as to how the withholding tax paid in India would be treated by the Foreign Service provider, while determining his tax liabilities, has not clearly come out in those decisions - With regard to limitation, the decision in M/S. T.V.S. MOTOR COMPANY LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE & SERVICE TAX, CHENNAI [2021 (9) TMI 81 - CESTAT CHENNAI], is squarely applicable to this case, where it was held that when the TDS amount has been borne by the assessee and only the consideration for the services as agreed upon by the parties has been paid to the service provider, the same cannot be included in the taxable value for determining the Service Tax liability.
The demand of Service Tax of Rs.10,24,257/- for the period May 2006 to March 2010, by way of issue of SCN on 08.06.2011, by invoking the extended period of demand, is not sustainable, in the absence of any justification for invoking the extended period. Accordingly, the above demand of Service Tax, along with demand interest and penalties is set aside as time barred.
CENVAT Credit - HELD THAT:- During the relevant period, the definition of the term “input service” specifically covered services used in relation to “setting up of the premises of the provider of output services”. The reliance placed by the Commissioner on CBEC Circular No.98/1/2008 dated 04- 01-2008, is not sustainable in as much as the said circular has been held to be contrary to the provisions of law, in several judgments. It is a fact on record that these services were used for construction of hotel premises, from which various taxable services would be provided by the Appellant, after completion of construction - The definition of the term “input” has been amended from 07.07.2009 so as to specifically exclude the goods used for construction of immovable property from the scope of “inputs”, whereas there is no such restriction in the definition of “input service”.
Even though there was an observation in the impugned order that the disputed credit has been reversed voluntarily by the Appellant, admitting their ineligibility to credit, the said observation is effectively countered by the learned counsel for the Appellant, by drawing reference to the reply to the SCN and written submissions.
The demand for denial of CENVAT Credit is not sustainable in law. Since the demand itself is not sustainable, the demand of interest and imposition of penalty are also liable to be set aside. Since the credit has already been reversed, the Appellant is entitled for consequential relief as per Section 142 (6)(a) of CGST Act, in view of the introduction of GST - Appeal allowed.
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2022 (5) TMI 78 - DELHI HIGH COURT
Benefits under the Sabka Vishwas (Legacy Dispute Resolution) Scheme 2019 - benefit could no be availed of due to technical glitches - It is the petitioner’s case that because of Covid-19, it could not take necessary steps for availing the benefits of the Scheme, within the timeframe fixed by the respondent - HELD THAT:- Mr. Bhatia says that the instant writ petition could be treated as a representation, which the concerned Commissionerate can be called upon to consider and dispose of.
The writ petition will be placed before the Delhi East Commissionerate, which issued the show cause notice dated 07.09.2018. 9.1. The Delhi East Commissionerate will, inter alia, consider the submission advanced before us by Mr. Bhatia, that in certain cases, exceptions have been made and those wanting to avail the benefits of the Scheme have been entertained, even after the deadline fixed under the Scheme i.e., 30.06.2020 had been crossed.
Petition disposed off.
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2022 (5) TMI 77 - CESTAT BANGALORE
Classification of services - Business Auxiliary Service or not - Storage and Warehousing Services or not - appellant purchases liquor from distilleries from in and outside State of Karnataka and distribute the same in the State - appellants also store liquor for a maximum period of 90 days without charging any storage fee - period October 2011 to September 2012 - HELD THAT:- The case is no longer res integra as submitted by the learned counsel for the appellant - this very Bench in the appellant’s own case KARNATAKASTATE BEVERAGES CORPN. LTD. VERSUS COMMR. OF ST, BANGALORE [2007 (8) TMI 55 - CESTAT, BANGALORE] has held that there is also no justification for imposing such a savage penalty on a State Government Corporation.
In the present case, the appellants have discharged their statutory functions as the mandate given by the Karnataka State Excise Act and Rules thereunder and have not rendered any services such as ‘Business Auxiliary Service’ and ‘Storage and Warehousing Service’. Therefore, the payments received by them in the form of commission or warehousing charges are not exigible to service tax - the impugned orders as far as they relate to the party’s appeals are not sustainable and needs to be set aside.
Appeal allowed - decided in favor of appellant.
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2022 (5) TMI 13 - CALCUTTA HIGH COURT
Violation of principles of Natural Justice - procedure of pre-consultation before issuance of show cause notice has not been adhered to - HELD THAT:- The process of pre-consultation as done in the instant case appears to have not been a statutory procedure but a procedure carved out by the Central Board with a view to promote compliance and to reduce the necessity for issuing the show cause notice. The object behind such process can be culled out from the master circular issued by the Central Board dated 10th March, 2017.
The record of the proceedings has been minuted on 13th October, 2016. Though the learned Advocate for the appellant would contend that the record of pre-show cause notice consultation meeting held on 13th October, 2016, is not comprehensive, it indicates the contentions, which were advanced by the appellant. The net result is thus if the Central Board has evolved a procedure to balance the interest of the assessee as well as the revenue, such procedure should be given due regard. This is precisely the reason the Central Board in its master circular dated 10th March, 2017 has directed that the authority, who has issued the pre-consultation notice, should be the authority, who shall issue the show cause notice and adjudicate the same in cases where pre-consultation does not resolve the dispute.
That apart, it is also noted that in the show cause notice dated 14th October, 2016 issued by the Audit- II Commissionerate, there is no reference to the pre-consultation process. This is incorrect as when the department has evolved a procedure, such procedure should be a meaningful procedure. At least a brief discussion is required to be made as the appellant was invited to participate in the pre-consultation before issuance of the show cause notice with a view towards trade facilitation and promoting voluntary compliance and to reduce the necessity of issuing the show cause notice in terms of the instruction issued by the Board dated 13th October, 2016.
The matter is remanded to the file of the Commissioner, Central Excise & Service Tax, Bolpur Commissionerate, West Bengal with a direction to issue show cause notice to the appellant within 15 days from the date of receipt of the server of this judgment and order wherein brief discussion with regard to the pre-consultation procedure, which was adopted shall be given - Appeal allowed by way of remand.
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2022 (5) TMI 12 - MADRAS HIGH COURT
Constitutional Validity of Rule 5(1) of Service Tax (Determination of Value) Rules - levy of service tax - Bank charges, CCTL charges, CFS charges from their clients payable to the respective Banks, it was specifically mentioned in the invoices that these charges are 'Non Taxable Services' - reimbursement of expenses or not - HELD THAT:- The issue involved herein is squarely covered by the decision of the Honourable Supreme Court in UNION OF INDIA AND ANR. VERSUS M/S. INTERCONTINENTAL CONSULTANTS AND TECHNOCRATS PVT. LTD. [2018 (3) TMI 357 - SUPREME COURT] in which, the order of the Delhi High Court declaring Rule 5 of Service Tax (Determination of Value) Rules as ultra vires and unconstitutional, was affirmed.
On a perusal of the order impugned herein, it is seen that the aforesaid decision was not taken into consideration by the learned Judge, while hearing the writ petitions filed by the appellant questioning the order / notices issued by the respondent authorities, demanding service tax towards 'non taxable services'; and the appellant was simply directed to approach the appellate authority by filing statutory appeals, after having observed that the issues involved are factual in nature. This court is of the view that such course adopted by the learned Judge cannot be countenanced. Therefore, the order of the learned Judge dated 17.06.2021 passed in the writ petitions is liable to be set aside and is accordingly, set aside. Consequently, the matters are remanded back to the authority concerned for fresh consideration.
Appeal disposed off.
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2022 (5) TMI 11 - CESTAT BANGALORE
Transfer of CENVAT Credit lying unutilized - amalgamation of entities - utilization of unutilized credit by transferree company - transfer of CENVAT credit by transferee entities and availment of the same by the appellants were disputed by the Department on the ground that as per the requirement of Rule 10(3) ibid, the transfer can only be effective, when stock of inputs as such or in process or the capital goods are also transferred from the transferor units to the transferee unit - CENVAT credit of service tax paid on the input services, can be availed by the transferee unit upon sale/merger with the business units of the transferors or not? - HELD THAT:- On a cogent reading of sub-rules (1) and (2) of Rule 10 ibid, it transpires that transfer and availment of unutilized cenvat credit is permissible under the statute, subject to fulfillment of the conditions that transfer of business must be on account of change of ownership or on account of sale, merger, amalgamation etc.; that there should be specific provision for transfer of liabilities of the business of service provider; that transfer is allowed only if stock of input as such or in process, or the capital goods are also transferred along with the business premises to the transferee company; and that the credit particulars are duly accounted in the books for satisfaction of the jurisdictional officer of Central Excise.
Learned Commissioner appears to have erred in finding that transfer of cenvat credit on input services is permissible only on the amalgamation whereas in terms of Rule 10 (1) & (2) of Cenvat Credit Rules, such a transfer is permissible on transfer of business on account of sale, merger, amalgamation, lease or transfer of business to a joint venture without specific provision for transfer of liabilities of such business. It is found that there is no provision in the statute that each one of the situations mentioned therein should be approved by the Hon‟ble High Court.
It is also noted that in the column ‘5B’ in the ST-3 return, titled as ‘cenvat credit taken and utilized', the appellants had reflected therein the credit particulars as ‘-', which means that as a result of merger, only cenvat credit of service tax was available in the books of accounts of the transferor company and no input or capital goods credits were available with them. Thus, it cannot be said that the appellants had not duly reflected the credit particulars in their books of accounts for the satisfaction of the Department officers - the appellants had duly complied with the requirements of Rule 10 ibid for availment of the cenvat credit lying unutilized in the books of the transferor‟s company and thus, denial of the cenvat benefit by the original authority will not stand judicial scrutiny.
There are no merits in the impugned order, insofar as it has confirmed the adjudged demands on the appellants - appeal allowed - decided in favor of appellant.
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2022 (5) TMI 10 - CESTAT NEW DELHI
Rejection of refund claim - non-supply of documentary evidence by which can be establish that the said amount is not utilised for discharging any other tax liability, and the said amount was lying in excess - revenue deposit - applicability of time limitation - HELD THAT:- The appellant had deposited the said amount of Rs. 2,00,000/- on 02.08.2019 during the course of audit and the said amount has been recognised in the audit report, although, it was deposited under the new registration number. Further, it is evident that the said amount has not been adjusted at the adjudication stage nor at the stage of settlement under the SVLDR scheme - Thus, under the facts and circumstances, the said amount is lying with the Department by way of revenue deposit. For such amount of Revenue deposit, there is no question of any limitation as provided under Section 11B of the Act and the appellant is entitled to refund of the said amount.
The Adjudicating Authority is directed to grant refund of Rs.2,00,000/- with interest under Section 11BB as per rule - Appeal allowed - decided in favor of appellant.
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