|
Advanced Search Options
Case Laws
Showing 221 to 240 of 1564 Records
-
2024 (8) TMI 1344
Violation of principles of natural justice - Seeking clarification of the judgment dated 30.05.2023 - RP has locus to file the Application or not - appointment of the Resolution Professional (RP) and the objections raised by the Personal Guarantors - HELD THAT:- There cannot be any denial that principles of natural justice are also attracted in the proceeding in Application under Section 95. However, the Hon’ble Supreme Court, after noting the scheme of insolvency proceeding, has held that Adjudicating Authority role cannot be held to be applicable at the stage of Section 97(5), i.e., at the stage when RP has been appointed.
It is to be noted that Appeal(s) were filed by the Appellant challenging order dated 10.04.2023 by which, RP was appointed in the Application under Section 95 filed by the Financial Creditor. The Appellant while challenging order dated 10.04.2023, did not implead the RP as one of the party, whereas RP was required to be impleaded, since the appointment of RP was sought to be challenged in the Appeal, the Appellant cannot take benefit of its own mistake, in not impleading the RP in the Appeal, who was required to be impleaded. It does not lie in the mouth of the Appellant to contend that RP has no locus to file the Application. The objection, which are sought to be raised by the Appellant, are only clear endeavor to prolong the proceedings under Section 95 - the submission of the Appellant that RP has no locus is rejected. Furthermore, the Adjudicating Authority in its order dated 09.05.2024 has observed that there is no assistance from the learned Counsel for the RP in the matter. It was due to the above observations that present Application has been filed by the RP, which cannot be said to be without any locus.
RP cannot be precluded form submitting its Report as per the law laid down by the Hon’ble Supreme Court and the Adjudicating Authority has to consider all objections raised by the Appellant(s) at the time of hearing of Section 100 and the order passed by this Tribunal dated 30.05.2023, cannot be read in any manner as to exclude the applicability of judgment of Hon’ble Supreme Court dated 09.11.2023 in Dilip B Jivrajka.
The Adjudicating Authority may proceed in the proceedings under Section 95 as per the law - Application disposed off.
-
2024 (8) TMI 1343
Prayer for clarification of the order dated 26.05.2022 passed by this Tribunal - prayer that Respondent - seeking Restraint on enforcement or execution of Arbitral Awards - HELD THAT:- It is noted that by order dated 11.01.2019, this Tribunal directed for continuation of pending proceedings before Arbitral Tribunals, which was with a caveat that Arbitral Tribunals are prohibited to pass any order under Section 17 of the Arbitration & Conciliation Act, 1996 against IL&FS or any of its Group Companies. Award passed, if any was to be kept in sealed cover till final decision of the petition under Section 241 and 242 of the Companies Act, 2013 pending before the NCLT. It was further observed that after the Award is given in favour of the IL&FS or any of its Group Companies, in such case, the Award need not be kept in sealed cover, even during the pendency of the Company Petition. An IA No.2114 of 2021 was filed by Respondent - Sadbhav Engineering Ltd.
This Tribunal in the order has observed that the order dated 26.05.2022 clearly indicate that Tribunal did not enter into the issues raised by the respective parties. It was further observed that the observations made in the order dated 26.05.2022 cannot be read to mean that it has in any manner varied the order dated 15.10.2018 passed in the Appeal, which was operating till date. It is reiterated that order dated 26.05.2022 neither vary, nor modified the order dated 15.10.2018 or the entire order dated 11.01.2019. The only modification was made in paragraph 2 of the order dated 11.01.2019 that sealed cover be opened, which was directed to be kept till the final decision of the Company Petition filed under Section 241 and 242. When the order dated 15.10.2018 has not been varied or modified, even if an Award has been opened from the sealed cover and communicated to the Respondents, the Respondents are not entitled to enforce the Award during the continuation of the interim direction dated 15.10.2018, which was subsequently affirmed by this tribunal on 12.03.2020.
Application allowed.
-
2024 (8) TMI 1342
Effect of moratorium when symbolic possession has already been taken over by the appellant - If the proceedings under the SARFAESI Act, 2002 were complete on 20.06.2019 when symbolic possession of the property of the Corporate Debtor was taken over by the Appellant and whether the moratorium under Section 96 of the Code would not affect the rights of the appellant?
HELD THAT:- This issue has already been answered in a recent judgement in Sanjay Dhingra Vs IDBI Bank Ltd & Ors [2024 (7) TMI 812 - DELHI HIGH COURT] where it was held that 'The respondent-bank cannot proceed further under the SARFAESI Act, in view of the interim moratorium, operating on account of the Insolvency Proceedings pending against the petitioner, the personal guarantor.'
The impugned order dated 25.02.2021 need not be interfered - the appellant shall not proceed further under the SARFAESI Act qua the subject property till the moratorium is lifted - appeal dismissed.
-
2024 (8) TMI 1341
Eligibility of “reason to believe” before effecting seizure - as argued non-consideration of such evidence and tangible material placed on record by the appellant, would by itself, vitiate not only the seizure orders but also the order passed by the Competent Authority.
HELD THAT:- As perused the Seizure Orders and find that the Officer has examined the relevant material before him in great detail and has, apparently after analysing the same, coupled with the statement of the CEO of the appellant, formed his “reasons to believe” before effecting seizures.
We have also examined the orderof the Competent Authority under the FEMA and find that the same is based on tangible material which was analysed and consequently the seizure orders were confirmed.
At that stage a Constitutional Court is not to interdict the investigations or probe the evidentiary value of such material gathered. It is trite that Courts exercising powers of judicial review would consider as to whether there was objective and tangible material available with the authorities before any action of effecting seizure was contemplated. A Court exercising writ jurisdiction is not sitting as an appellate court or authority. Thus, we are satisfied that the learned single Judge has exercised the jurisdiction vested, correctly.
As urged many facts which cannot be evaluated or considered by a writ Court since the same would require evidence and the evaluation thereof - The issue as to what constitutes “capital account transaction” and “current account transaction” and as to how the appellant has transacted its business and by what mode etc. and whether the appellant is connected to the Opera Group and other entities like Mobimagic and HK Fintango, with whom and through whom, it is alleged that financial transactions were made which are alleged to be in violation of the provisions of FEMA, in our considered opinion, are highly disputed questions of fact. Having regard to the fact that the records indicate that there exists an absolutely diametrically opposite and contrary set of disputed facts, it is apparent that the Court exercising powers of judicial review under Article 226 of the Constitution of India, does not have the necessary wherewithal to render its opinion thereon.
Impugned order relegating the appellant to the proceedings before the Adjudicating Authority without deciding the matter on merits itself - We find that the ld' Single Judge has noted that the respondents have already filed a statutory complaint before the Adjudicating Authority and substantial hearings have already taken place before it.
We have found that the learned Single Judge has already examined the issue on merits and passed the impugned judgment. Having regard to the fact that the Adjudicating Authority while deciding the complaint shall obviously also decide the sanctity of the seizure as also the validity of the Confirmation Order dated 04th February, 2022 passed by the Competent Authority, we too find no reasons to interfere with the observations rendered by the learned Single Judge in the impugned judgment.
-
2024 (8) TMI 1340
Jurisdiction to issue order - Recovery of service tax with interest and penalty - Challenge to assessment order - execution of works contracts as a sub-contractor to the main contractor - petitioner having declared income from sub-contracts, and paid income-tax, failed to pay the service tax by duly filing the ST-3 returns - HELD THAT:- As against the order-in-original statutory appeal lies to the Commissioner (Appeals). However, without availing the said remedy the petitioner has approached this Court stating that the order of the 3rd respondent is without jurisdiction, in as much as the services rendered by it to the main contractor are exempt from payment of service tax in terms of the Notification No. 25/2012-Service Tax, dated 20.06.2012.
On the basis of the material before it, the 3rd respondent has passed the order in original. If the petitioner is really aggrieved by the said order remedy is to file an appeal before the appellate authority before which the petitioner can in a better manner, if he has some material to support his contention, establish his case of sub-contract.
It could not be argued by learned counsel for the petitioner as to how the order is without jurisdiction. The issue of the work in question was done as contractor or sub-contractor is one of fact on which finding has been recorded by the 1st authority against the petitioner.
No justifiable ground has been pointed out by the petitioner seeking indulgence of this court under Article 226 of Constitution of India - the writ petition cannot be entertained - Writ Petition is dismissed on the ground of availability of alternative remedy to the petitioner.
-
2024 (8) TMI 1339
Invocation of extended period of limitation - SCN issued on the third party data - Recovery of service tax - levy of penalty - HELD THAT:- The show cause notice dated 06.09.2018 seeks to cover the period 2012-13 onwards as submitted by the learned Counsel for the appellant; the period before 01.10.2012 is clearly beyond even the extended period; for this reason, the demand confirmed cannot be sustained and confirmation of demand, if any, has to be for the period 01.10.2012 to 31.03.2013 only. In addition, learned Counsel for the appellant submits that as the appellant has rendered only one service, abatement @60% in terms of Rule (2C) of the Service Tax (Determination of Value) Rules, 2006 should be allowed to them. The argument of learned AR that the appellant has not obtained registration and not filed returns should not come in the way of the benefit i.e. legally due to the appellant.
On going through the facts and circumstances of the case, this Bench finds that there are no reasons to disbelieve the learned Counsel for the appellant. This Bench appreciates the fairness of the learned Counsel in accepting the liability even when extended period cannot be invoked. This Bench finds its appropriate to confirm the duty for the period 01.10.2012 to 31.03.2013 along with interest. This Bench is of the considered opinion that no penalty is imposable on the appellant.
The appeal is partially allowed by confirming the demand of Rs.42,013/- for the period 01.10.2012 to 31.03.2013 along with interest.
-
2024 (8) TMI 1338
Refund of service tax paid on the services availed in course of export by whatever name the said services are availed under N/N. 41/2007- ST dated 06.10.2007 - procedural violation - HELD THAT:- The Tribunal in the case of M/S. DURGA MARBLE & MINERALS VERSUS C.C.E. JAIPUR-II [2016 (12) TMI 993 - CESTAT NEW DELHI] has held that 'Since, export of goods in question has not been disputed by the Department, service tax paid on the taxable services used for ultimte exportation of goods, in our opinion, should merit consideration for refund in terms of the Notification dated 6- 10-2007.'
The appellants are eligible to avail refund on GTA Services; however, as submitted by the learned Authorized Representative, the refund shall be limited to the GTA Services availed from the ICD to the Port of export; for this purpose, the matter has to travel back to the Original Authority for verification of the claim of the appellants. Also, in the case of Inspection and Testing Charges, as per their own averment, the appellants did not submit the copies of agreements before the Original Authority; the appeals as far as these charges are concerned also require to be verified by the Original Authority only to the extent of verification of concerned agreements - the credit of service tax paid for C & F Services shall be admissible only w.e.f. 07.12.2008.
The appeals are partly allowed by way of remand to the Original Authority.
-
2024 (8) TMI 1337
Classification of service provided by PwC - Chartered Accountant Services or not - Classification of service - Market Research Agency’s Services or not - Export of service - Time Limitation - Interest and penalty.
Classification of service - Chartered Accountant Services or not - HELD THAT:- The appellant, which is a Private Limited Company i.e. an Incorporated Company, is not engaged in the practice of Chartered Accountancy and does not function as statutorily required for Practicing Chartered Accountants and the appellant is not permitted to practice as a firm of chartered accountants by the Institute of Chartered Accountants of India. Therefore, the services rendered by the appellant cannot be classified under ‘CA Services’ by any stretch of imagination.
Classification of service - Market Research Agency’s Services or not - HELD THAT:- The nature of services rendered by the appellant includes providing consultancy or advice, assistance in mergers & acquisition of companies, conducting due diligence under specific situations/transactions, conducting health check or diagnostic reviews, evaluation financial viability of a transaction amongst others. Rather, the nature of services rendered by the appellant, it can be rightly classified under the category of Management or Business Consultants Services. The word management signifies ways and means for managing the organization, by any means i.e. by directions or by regulations or by administration. The word ‘direction’ indicates framing of policy and the word ‘regulation or administration’ indicates the standard operating procedure to be followed for achievement of the policy.
The demand of Rs.1,27,90,193/- has been confirmed considering that the services are to be classified under the practicing Chartered Accountant Services and the Market Research Agency’s Services; but it has not been quantified in the impugned order as to how much is the demand under each category; therefore, the impugned order is bad classifying the services rendered by the appellant under the category of Chartered Accountant Services and the Market Research Agency’s Services.
Export of service - HELD THAT:- The appellant has entered into contract/agreement with PwC Overseas Network Firms and not with the clients of PwC Overseas Network Firms under which the appellant provides services, which can either be provided from the premises of the appellant or any other place as agreed with PwC Overseas Network Firms. The privity of contract arises between the appellant and PwC Overseas Network Firms and not between the appellant and the clients of PwC Overseas Network Firms, because the PwC Overseas Network Firms have separate agreement with its clients.
The issue whether the services provided by the appellant to the Foreign Network Firms and other Foreign Companies for a consideration collected in convertible foreign exchange would be qualified for export services under Export of Services Rules, 2005 or otherwise is no more res integra and has been settled by the Hyderabad Bench of the Tribunal in the appellant’s own case CCCE&ST, HYDERABAD-II VERSUS PRICE WATERHOUSE (VICE-VERSA) [2018 (11) TMI 32 - CESTAT HYDERABAD] where it was held that 'It is undisputed that the appellant herein rendered services to their overseas network entities as well as to their clients located outside India and the consideration for such services was collected inconvertible foreign currency. The findings of the adjudicating authority is that the services rendered by the appellant are in the form of auditing and accounting of various entities situated in India but had only forwarded the certificate to the foreign entities which is not service rendered outside India; it is also finding that the services are rendered to foreign clients, but performed wholly within India.'
Time Limitation - HELD THAT:- The dispute in this case involves interpretation of classification of service and eligibility for export of service and it has been held by the Hon’ble Apex Court in the case of PADMINI PRODUCTS VERSUS COLLECTOR OF C. EX. [1989 (8) TMI 80 - SUPREME COURT] that when the matter involves interpretation of statutory provisions, extended period of limitation cannot be invoked. Further, the extended period cannot be invoked in the present case as there is no evidence on record to show that there is any fraud or collusion or wilful mis-statement or suppression of facts or contravention of any of the provisions of law or rules made thereunder with intent to evade payment of tax.
Interest and penalty - HELD THAT:- When the demand of service tax itself is not sustainable, therefore, the question of interest and penalty does not arise.
The impugned order is not sustainable in law and is set aside - appeal allowed.
-
2024 (8) TMI 1336
Classification of service - Construction of complex service or Works Contract service - scope of SCN - Time limitation - HELD THAT:- While the SCN demanded the Service Tax under the category of ‘Works Contract service’ for the period 01.06.2007 to 31.03.2011, the Adjudicating Authority has confirmed the demand under the different category i.e., under the category of ‘Construction of Residential Complex service’ and has also given some justification to come to this conclusion. This would amount to traversing beyond the scope of SCN. This will also amount to non-following of principles of natural justice. The Appellant was never put to notice that the demand is going to be confirmed under the category of ‘Construction of complex service’. They were issued notice seeking as to why the demand should not be confirmed under the category of ‘Works Contract service’. Therefore, they are defending the demand made under the category of Works Contract, without taking any defence on account of Construction of Complex service.
The confirmed demand is not legally sustainable since the demand was confirmed under the category of ‘Construction of Residential Complex service’ while the SCN was issued under the category of ‘Works Contract service’. The Tribunals have also been holding that no Service Tax is payable till 01.07.2010 irrespective of the category under which the service may fall - Appeal allowed.
Time limitation - HELD THAT:- First of all, the Appellant was properly registered with the Department and they have been filing their Returns regularly. Their ST3 Returns are one of the relied upon documents while issuing the SCN. Further, the VAT Returns have been referred to in the SCN, which shows that they have filed their VAT Returns regularly. Thus, all the data with regard to their turnover was very much being shown in the Returns. Further, in order to clarify the issue as to whether ‘Construction of Residential Complex service’ would be taxable or not, CBIC had issued various circulars between the period 2006 and 2012 - Hence, it can also be said to be as an issue of interpretation. In such circumstances, the Appellant cannot be fastened with the allegation of suppression - Accordingly, the confirmed demand for the extended period set aside on account of time bar also.
Appeal disposed off.
-
2024 (8) TMI 1335
Classification of services - Management, Maintenance & Repair Service or Works Contract Service (WCS) - appellant were providing services and were also using their own goods - short payment of service tax - denial of Cenvat Credit - GTA Services - penalties.
Classification of services - Management, Maintenance & Repair Service or Works Contract Service (WCS) - appellant were providing services and were also using their own goods - HELD THAT:- There are force in the Appellant’s argument that no Service Tax was payable for the period till 31.05.2007 as held in catena of decisions. The Adjudicating Authority is required to verify the documentary evidence to the effect that the services would fall under the category of Works Contract service and once he is satisfied, the demands till 31.05.2007 should be dropped. In case of MMRS, the Appellant has also pleaded that even under this category, they would be eligible for tax exemption if the service is provided to Government. The Adjudicating Authority should give opportunity to the Appellant to make their submissions on this count also.
Short payment of service tax - HELD THAT:- The Appellant submits that Rs.24,26,857/- along with interest of Rs.9,34,164/- has already been paid by them and appropriated by the Adjudicating Authority while passing the impugned order. In respect of the balance Rs.6,36,381/-, their pleading towards services being provided under Works Contract service for the period till 31.05.2007 is to be verified by the Adjudicating Authority and if it is found so, the demand has to be dropped.
Denial of Cenvat Credit - HELD THAT:- The Adjudicating Authority should consider all the documents together and pass his Order accordingly. In respect of denial of Cenvat Credit of Rs.39,47,390/-, the Appellant has admitted that they are not in a position to provide any documentary evidence, whatsoever, for an amount of Rs.9,16,391/-. Therefore, the Appellant is directed to pay this amount along with interest thereon. The Appellant is directed to produce photo copies of the invoices in respect of the balance Cenvat Credit along with other corroborative evidence in the form of ledgers for having received the stocks and using the same for provision of taxable services. The Adjudicating Authority to pass considered decision after going through the documentary evidence placed before him.
GTA Services - HELD THAT:- The Appellant’s pleading is that out of demand of Rs.9,77,011/-, they have already paid Rs.8,06,767/-. The Appellant is required to pay interest on this amount and also provide evidence as to why the balance amount is not payable. The Adjudicating Authority to consider these facts and if any further amount is required to be paid for which the Appellant has not provided proper evidence, the balance amount towards GTA services should be recovered from the Appellant along with interest.
Penalties - HELD THAT:- To a great extent, the Appellant has been able to prove that if the service happens to be falling under Works Contract service; that too prior to 31.05.2007, no Service Tax is required to be paid. Further, in many cases they have paid the Service Tax with or without interest. The Adjudicating Authority to consider the factual details and impose the penalty as per the statutory provisions.
Appeal disposed off.
-
2024 (8) TMI 1334
Miscellaneous application seeking change of name of the Respondent - Scope of SCN - it is submitted that in the SCN in the present case there was no allegation for proposing demand on the appellant for services provided to HPCL under the head site formation and clearance, excavation and earthmoving and demolition' - Violation of principles of natural justice - HELD THAT:- The SCN was issued to the appellant proposes to classify the demand under ‘Commercial or Industrial Construction Service’ under Section 65(105)(zzq) of the Act, whereas in the impugned order the demand has been confirmed by changing the classification under the head ‘Site Formation and clearance, excavation and Earthmoving and Demolition’ which cannot be done and hence the impugned order is bad in law.
Secondly, it is undisputed that the services rendered by the appellant is classifiable under ‘Works Contract Service’ as provide under Section 65(105)(zzzza) of the Finance Act, 1994 as it involves both supply of goods as well as service; once, it is not disputed, it is the works contract service then demand of service tax under ‘site formation and clearance, excavation and earthmoving and demolition’ is not sustainable in law.
The impugned orders are not sustainable in law and the same are set aside by allowing the appeals of the appellant with consequential relief - Appeal allowed.
-
2024 (8) TMI 1333
Classification of service - appellant had performed service in India and delivered clinical study report to their foreign client through E-mail, Courier or website - case of the department is that since the performance of service is in India and the clinical study was carried out on the goods supplied by the service recipient, therefore, the service of the appellant does not fall under the category of Export of Service in terms of Rule 4 of Place of Provision of Service Rules, 2012 - HELD THAT:- The appellant have carried out the clinical study on the drugs supplied by the foreign based service recipient. After carrying out the clinical study on the goods supplied by the service recipient the technical report thereof was supplied to the service recipient. The service recipient is located outside India.
On the identical facts and the activity involved in the present case, various judgments have been passed - reliance can be placed in COMMISSIONER OF CENTRAL EXCISE PUNE-I VERSUS SAI LIFE SCIENCES LTD. [2016 (2) TMI 724 - CESTAT MUMBAI] where it was held that 'it can be safely said that the Research & Development Service performed by the Appellant is export of service in terms of Rule 3 of Rules, 2012. Earlier also for the period July, 2012 to September, 2012, October, 2012 to December, 2012 and January, 2013 to March 2013, the said services were treated as export of services by the department and no relevant material has been placed on record to treat the same differently for the period in dispute. Therefore the Scientific and Technical Consultancy Services provided by the Appellant to DITC is to be treated as export of service.'
In the case of M/S FERTIN PHARMA RESEARCH & DEVELOPMENT INDIA PVT. LTD. VERSUS COMMISSIONER OF CGST, NAVI MUMBAI [2018 (10) TMI 1373 - CESTAT MUMBAI] the tribunal observed 'the appellants are eligible to cash refund of the accumulated Cenvat credit under Rule 5 of the Cenvat Credit Rules, 2004, except in relation to credit availed input services denied by the Learned Commissioner (Appeals) observing that necessary evidences in relation to Building maintenance charges were not produced to establish the nexus with the output service and secondly the rent-a-cab service since placed under the exclusion clause of the definition of input service after amendment to Rule 2(l) of the Cenvat Credit Rules, 2004 with effect from 1-4-2011.'
Thus, the activity of clinical trial on the drugs supplied by the foreign service recipient to the appellant amounts to export of service, hence, same is not liable to service tax - the impugned order is set aside - appeal allowed.
-
2024 (8) TMI 1332
Denial of abatement as per N/N. 32/2004-ST dated 03.12.2004 - benefit denied on the grounds that the invoices issued by the GTA operators did not carry an endorsement to the effect that CENVAT credit has not been availed - HELD THAT:- It is found that the condition laid down in the N/N. 32/2004 is understandably for the GTA Service providers, who pay service tax themselves. It is not applicable to the appellant who pays the service tax on GTA Services received on Reverse Charge basis. Therefore, the Department is reading beyond the scope of the Notification.
Hon’ble Apex Court in the case of M/S. SANDUR MICRO CIRCUITS LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, BELGAUM [2008 (8) TMI 3 - SUPREME COURT] held that 'The issue relating to effectiveness of a Circular contrary to a Notification statutorily issued has been examined by this Court in several cases. A Circular cannot take away the effect of Notifications statutorily issued. In fact, in certain cases, it has been held that the Circular cannot whittle down the Exemption Notification and restrict the scope of the Exemption Notification or hit it down. In other words, it was held that by issuing a circular a new condition thereby restricting the scope of the exemption or restricting or whittling it down cannot be imposed. The principle is applicable to the instant cases also, though the controversy is of different nature.'
The issue is no longer res integra being covered by a catena of judgments. Therefore, the impugned order cannot be sustained - the issue of limitation etc. not gone into as the appellants succeed squarely on merits.
Appeal allowed.
-
2024 (8) TMI 1331
Applicability of Sr. No. 45 as as inserted on 01.04.2015 in the Mega Exemption N/N. 25/2012-ST dated 20.06.2012 - amount collected on account of vintage classic car collection w.e.f. 01.04.2015 - Department alleged that the appellant does not fall under the said entry for the reason that the space in the appellants’ premises for keeping the vintage car cannot be called as ‘Museum’ covered under the said entry.
Whether, after 01.04.2015 also, the appellant was still liable to pay service tax on the entry fee as the display of vintage car collection in appellant’s hotel cannot be called as ‘museum’?
HELD THAT:- It is the settled principle of statute interpretation that the terms which have not been defined in a statute are to be understood in their ordinary or popular sense instead of being defined in technical sense. The adjudicating authorities below have relied upon the technical definition of ‘Museum’ given by ICOM statutes adopted by 22nd General Assembly in Vienna, Austria on 24.08.2007.
Support drawn from the decision of Hon’ble Apex Court in the case of MSCO PVT. LTD. VERSUS UNION OF INDIA AND OTHERS [1984 (10) TMI 44 - SUPREME COURT] wherein it has been held that while construing a word in a statute or a statutory instrument in the absence of any definition in that very document it must be given the same meaning which it receives in ordinary parlance or understood in the sense in which people conversant with the subject matter of the statute or the statutory instrument understand it. The Hon’ble Apex Court clarified that it is hazardous to interpret a word in accordance with its definition in another statute or statutory instrument and more so when such statute or statutory instrument is not dealing with any cognate subject.
The said decision of Hon’ble Supreme Court is sufficient to hold that the Adjudicating Authorities have committed an error while relying upon ICOM for the definition of word ‘Museum’ as a building in which objects of historical etc., interest are stored or a place having an archive of objects. It is undisputed fact that the appellants were displaying historical/vintage cars in a specific earmarked area in their hotel - the amount collected as entry fee is towards ‘admission to museum’ as is covered under Sr. No. 45 of the exemption notification number.
The amount of entry fee is the fee collected for providing service as that of admission to the vintage car museum in the appellant’s premises, hence, is clearly exempted unless entry no. 45 of the exemption notification. Hence, the demand with respect to the amount of service tax confirmed in this appeal vis-à-vis entry fee to vintage car museum, the demand is held liable to be set-aside. To that extent, the findings in the order under challenge are liable to be set-aside.
The order under challenge of M/s Lake Palace Hotels and Motels Private Limited set aside - appeal allowed.
-
2024 (8) TMI 1330
Levy of service tax - appellant’s activity of charging market fee for using licenses to traders/agents/factory etc. - Jurisdiction of officials of the DGGSTI - HELD THAT:- This issue is no more res-integra. The Hon’ble Supreme Court in the case of Krishi Upaj Mandi Samiti vs. Commissioner of Central Excise & Service Tax [2022 (2) TMI 1113 - SUPREME COURT] and held 'The fact that, on and after 1-7-2012, such activity by the Market Committees is put in the Negative List, it can safely be said that under the 2006 circular, the Market Committees were not exempted from payment of service tax on such activities. At this stage, it is required to be noted that it is not the case on behalf of the Market Committees that the activity of rent/lease on shop/land/platform as such cannot be said to be service. However, their only submission is that the Market Committees are exempted from levy of service tax on such service/activity as provided under the 2006 circular, which as observed hereinabove has no substance.'
The adjudication is a quasi-judicial function of the departmental officers of the Central Board of Indirect Taxes and Customs. It is mandatory that a Show Cause Notice (SCN) is issued if the department contemplates any action prejudicial to the assessee. The SCN would detail the provisions of law allegedly violated and ask the noticee to show cause why action should not be initiated against him under the relevant provisions of the Act/Rules. Thus, an SCN gives the noticee an opportunity to present his case. It is noted that the SCN in the present case was issued by the Central Excise officer on 19.06.2014, which is well before the introduction of GST in India. Thereafter, the impugned order was passed in 2018, which was after the introduction of GST - Section 174 of the CGST Act 2017, unequivocally saved all rights, obligations, privileges and liabilities that were available under the old laws, which would continue in the new regime - Section 174 of the CGST Act 2017, unequivocally saved all rights, obligations, privileges and liabilities that were available under the old laws, which would continue in the new regime.
It is noted that in the impugned order, the Commissioner (Appeals) has already upheld the demand for the normal period only. Therefore, this argument of the Counsel does not hold.
The impugned order upheld - appeal dismissed.
-
2024 (8) TMI 1329
Classification of goods - bins - to be classified under Tariff Sub-Heading 8474 90 or under Tariff Sub-Heading 7308 90? - Applicability of Rule 57U and Rule 57AH - HELD THAT:- The SCN was issued under Rule 57U and not under Rule 57AH. Admittedly, Rule 57U was omitted by the time the SCN was issued. This issue was never argued at any stage by either side nor had this Tribunal examined if Rule 57U existed at all while passing the final order remanding the matter to the Commissioner. Everyone including this Tribunal proceeded on the presumption that it had existed at that time.
Even in the written submissions given to the Commissioner on 8.3.2021, the appellant did not raise this issue. After two years, on 26.4.2023, the Commissioner held a personal hearing when the appellant had appeared and made submissions. It does not appear that at any of these stages, the Commissioner had pointed out to the appellant that their case would be examined under Rule 57AH and not under 57U and had given then an opportunity to examine Rule 57AH and make submissions. Only in the discussions part of the impugned order, the Commissioner held that Rule 57U was already repealed and examined the case under Rule 57AH - there are no reason why the Commissioner did not point out that Rule 57U had not existed at the relevant time and therefore, he would be examining the case under Rule 57AH.
Also, the new Rule 57AH increased the time limit from 6 months to one year and therefore, the liability of the appellant was increased in the impugned order behind the appellant’s back without ever giving the appellant even an opportunity to defend itself.
The SCN was issued under Rule 57U which was not existing at that time and the appellant was never given an opportunity defend against or were even put to notice that their case will be examined under a new Rule 57AH which increased their liability.
The impugned order is set aside - appeal allowed.
-
2024 (8) TMI 1328
Eligibility for input Cenvat credit and its utilisation for payment of duty demanded on job worked goods - invocation of Extended period of limitation - levy of fines and penalties.
Whether the Appellant is eligible to the input Cenvat credit and its utilisation for payment of duty demanded on job worked goods? - HELD THAT:- There is no evidence on record to show that the goods have been directly received by the Appellant on the directions of the principals. The Appellant (A1) has failed to comply with Rule 9(5) of CCR as they have failed to maintain proper records for the receipt, disposal, consumption and inventory of the inputs in which the relevant information regarding the value, duty paid and Cenvat credit taken and utilised, the persons from whom such inputs are procured is recorded and the burden of proof regarding the admissibility of Cenvat credit shall lie upon the manufacturer which is the Appellant (A1) in this case.
It is a settled law that adjustment of Cenvat credit of inputs is permissible whenever demand is made by the Department on the final manufactured goods.
The Appellant (A1) is eligible to avail Cenvat Credit on the inputs used in the manufacture of job worked goods provided the suppliers of these raw materials endorse the documents in favour of the Appellant (A1) and subject to verification of the duty paid nature of input invoices / documents / Bills of Entry, which were already submitted to the Adjudicating Authority. In paragraph 46.15 of the Order of Adjudicating Authority, it was mentioned that all the documents in five spiral bound booklets for examining the Appellant’s eligibility for input Cenvat credit were sent to the Assistant Commissioner of Central Excise, Coimbatore-II division for conducting verification - As there is a considerable delay, verification of the documents submitted to be got completed within a period of 6 months from the date of communication of this order.
Whether Extended Period is invokable or not considering the evidence and facts in this appeal? - HELD THAT:- The Appellants have not given the true picture of the activity carried out by them on job work. It is also to be noted that the Appellant (A1) has not paid service tax till the raising of the Audit objection in March 2012 though they have started job work production for the suppliers of raw materials from June, 2010. Neither they have paid excise duty nor service tax during this period. The details relating to manufacture of excisable goods on job work basis out of the raw materials supplied by the traders and non-payment of central excise duty thereon was not disclosed by the Appellant (A1) either in the ER-1 Returns filed or by service tax payment or in any other manner - Even, the conduct of appellant defies logic when they have not discharged the excise duty on job worked goods but were paying on its own production of identical goods. In view of the above detailed reasoning, it is held that larger period has been rightly invoked.
Whether the imposed fines and penalties are justifiable or not? - HELD THAT:- There are no merit in submission of Shri Vikas Sanghrajka (A5), Executive Director of Appellant (A1) that they were under mistaken impression that job work activity undertaken by them would not be manufacturing activity when they have obtained registration and treating the identical activity as manufacture. He is well aware that there was no difference between the manufacturing activity in respect of their own goods and the job work done in respect of suppliers’ goods - As in charge of day to day activities of the company, he is accountable for deliberate and well planned contravention of the provisions of law in job work manufacture and clearance of the excisable goods without payment of duty. The statement of Smt. Libra, Director of Appellant (A1) to the effect that the company had made incorrect mention of the activity as ‘cutting’ with an objective to limit duty liabiity supports wilful contravention of law to evade payment of applicable excise duty. Thus, he has played a crucial role in facilitation of removal of excisable goods manufactured on job work without payment of duty.
The Appellants (A2-A4) had connived in the commission of offence of non payment of duty on the job worked goods and so are liable to penalty under the Rule 26 (1) of the Central Excise Rules, 2002 - however, the penalties imposed are on the higher side and to meet the ends of justice, the same are reduced.
The appeals are partly remanded and partly allowed.
-
2024 (8) TMI 1327
Special Additional Excise Duty (SAED) levied as a Surcharge under Section 147 of the Finance Act 2002 - Additional duty of Excise (AED) levied as Road and Infrastructure Cess under Section 112 of the Finance Act 2018 - goods manufactured and exported by the Respondent viz. Reliance Industries Limited - rejection of refund application on the ground that SAED (Surcharge) and AED (Cess) were payable on MS, HSD and ATFwith effect from 1-7-2022 under the said Notification no.4/2022-CE dated 30-6-2022, Notification No.5/2022-CE dated 30-6-2022 and Notification no.10/2022-CE dated 30-6-2022.
Whether the levy of special additional excise duty as surcharge under Section 147 of the Finance Act, 2002 and additional duty of excise levied as road and infrastructure cess under Section 112 of Finance Act, 2018 read with relevant Notifications Nos.04/2022-CE dated 30.06.2022, 05/2022-CE dated 30.06.2022, 10/2022-CE dated 30.06.2022 and 19/2022 dated 19.07.2022 in respect of SEZ unit is correct and if not whether the respondent are eligible for the refund of the duty which has already been paid by the respondent?
HELD THAT:- Under both the Sections 147 and 112 of the Finance Act, 2002 and 2018 respectively, it is clear that both the duties are in addition to the duties of excise chargeable on such goods under the Central Excise Act. Therefore, these duties are in other words become a part of duties of excise chargeable on such goods in terms of Section 3 of the Central Excise Act, 1944. Moreover, sub section (3) of both the Sections 147 of the Finance Act, 2002 and Section 112 of Finance Act, 2018 clearly provide that the provision of Central Excise Act and the Rules made there under, shall as far as may be apply in relation to levy and collection the SAED and AED on the goods in question under that Act or those rules as the case for. In view of this clear position since the levy of SAED and AED under Section 147 and 112 of the Finance Act 2002 and 2018 respectively are in addition to the duties of excise chargeable on such goods under the Central Excise Act, the provision of relevant Section 3 of Central Excise Act, 1944 shall be statutorily invoked and applied in this case.
From the Section 3 which is Parent Act for levy of Excise duty clearly provides that the duties of excise to be called as central value added tax shall be levied and collected on all excisable goods which are produced or manufactured in India. However, it clearly eschewed the goods produced or manufactured in Special Economic Zone. The levy of SAED and AED cannot be made in isolation in terms of Section 147 of the Act, 2002 and Section 112 of Finance Act, 2018 without applying the provision of Section 3 of the Central Excise Act as per the mandate given in sub Section (3) of Section 147 and Section 112 of the Finance Act, 2002 and 2018 respectively - in view of the clear statutory provision as reproduced above. In respect of goods manufactured or produced in special economic zones, no excise duty as well as SAED and AED is levied.
It is a settled law that the subordinate legislation cannot overrule the primary legislation. The primary legislation is enacted by parliament and under the said legislation the executive power is given to make laws in order to implement and administer the requirements of the primary legislation. Such law is the law made by a person or body other than the legislature but with the legislature’s authority. Article 13(3) of the Indian Constitution includes within the definition of law forms of subordinate legislation such as order, rule, regulation, notification. Therefore, the subordinate legislation in the present case i.e. Notification No.19/2022-CE dated 19.07.2022 which was issued contrary to the provision of Section 3 of Central Excise Act read with Section 147 and 112 of Finance Act, 2002 and 2018 respectively. Hence the same cannot prevail over the primary legislation - even though, the Notification No.19/2022- CE created the same is not binding for the reason that the same is not in consonance with primary legislations which is Section 3 of Central Excise Act, 1944 read with Section 147 of the Finance Act, 2002 and Section 112 of the Finance Act, 2018. This Tribunal has to give primacy to the primary legislation and not to the subordinate legislation.
For levy under Section 147 and 112 of 2002 and 2018 Act respectively the taxable territory needs to be decided on the basis of Section 3 of Central Excise Act 1944 which excludes the territory of SEZ. Therefore as regard the taxable territory such exclusion shall apply mutatis mutandis for levy of SAED and AED under Section 147 of 2002 Act and 112 of 2018 of Finance Act.
Similar issue has been considered in the respondent’s own case by this Tribunal RELIANCE INDUSTRIES LTD. VERSUS C.C.E & ST-CGST & CE-RAJKOT [2024 (2) TMI 1419 - CESTAT AHMEDABAD] wherein, this Tribunal held that goods manufactured in the SEZ unit are not liable to said SAED ( surcharge ) AED (road and infrastructure cess) under Section 147 of Finance Act, 2002 and Section 112 of Finance Act 2018 respectively.
From the plain reading of the Section 51 of SEZ Act, 2005, it makes clear that the provision of SEZ Act shall have overriding effect on any law or Act in respect of the provision which is inconsistent with the provision of SEZ Act. In the present case, the SEZ Act exempts all duties in respect of the goods manufactured in the SEZ whereas the Revenue contented that Section 147 of Finance Act 2002 and Section 112 of Finance Act, 2018 are independent Act under which the levy of SAED and AED are applicable on SEZ unit also. In this position, since the Section 147 of the Finance Act, 2002 and 112 of Finance Act, 2018 creating an inconsistency with the provision of SEZ Act then the provision of SEZ Act overrides the provision of Finance Act, 2002 and 2018. For this reason also, the Revenue’s proposal for levy of SAED and AED on the respondent’s SEZ unit is illegal and incorrect.
The respondent was not liable for payment of SAED and AED being an SEZ unit. Hence the said duties so paid are refundable to the respondent along with interest, in accordance with law. As a result the revenue’s appeal is dismissed.
-
2024 (8) TMI 1326
Interpretation of provisions of the Maharashtra Municipal Corporation Act, 1949 (the Act) and the Maharashtra Municipal Corporation (Local Body Tax) Rules (the Rules) - Scope of the phrase “disputed tax” as appearing in Section 406 (8) of the Act - whether Petitioner is liable to pay Local Body Tax (LBT)? - HELD THAT:- The scheme of levy of LBT makes a distinction between levy of tax and interest and penalty. Rule 5 of the said rules provides for liability to pay LBT in certain cases and various sub-rules therein prescribes liability to pay LBT including any interest and penalty. Rule 27 of the said Rules provides for lump sum payment of LBT in case of registered dealer having small turnover and the LBT based on the turnover ranges from Rs. 2,000/- to Rs. 5,000/-.
The provisions in the Act, the said Rules and Forms point to the fact that even the law makers wanted to indicate that tax, interest and penalty are distinct. If the legislature intended to make tax, interest and penalty as a pre-condition they would have simply stated “disputed demand” and not “disputed tax”.
In Chennai Network Infrastructure Limited [2017 (4) TMI 1152 - BOMBAY HIGH COURT] the issue that arose before Co-ordinate Bench of this Court was for filing an appeal under Section 406 of the Act for challenging the penalty imposed under Section 267-A of the said Act, whether the appellant is required to pay the said penalty as a condition precedent for entertaining appeal. It was the contention of the appellant therein that penalty is not a tax and Section 406 requires, as a condition precedent for entertaining appeal, payment of disputed tax and since the penalty imposed was not a tax, no amount is required to be paid. This Court rejected the contention of the appellant after analysing the provisions of Sections 128-A, 129 and 267-A which dealt with property taxes - the Court came to a conclusion that an appellant has to pay penalty amount for entertaining the appeal.
In the present case the issue does not relate to property tax under Sections 128-A, 129 and 267-A of the Act nor it is the case made out by respondent in the impugned order that Section 406 (2) of the Act is applicable to petitioner. The issue raised in the appeal by petitioner is with respect to levy of LBT on entry of goods within the Municipal limits of respondents and the interest is charged on the premise that the demand made for the period 2015 to 2017 has not been paid and further penalty of Rs. 15,000/- is imposed under Rule 48 of the said Rules. The levy of LBT is governed by Section 127 of the Act read with the said Rules. Therefore, the provisions of Sections 128-A, 129 and 267-A are not applicable and are also not the subject matter of the appeal filed by petitioner.
The impugned order dated 22nd February 2024 is hereby quashed and set aside and the matter is remanded for denovo consideration. The appellate authority shall dispose the appeal in accordance with law by giving a personal hearing, notice whereof shall be communicated atleast 5 working days in advance - Petition disposed off.
-
2024 (8) TMI 1325
Refusal of the 1st respondent in accepting the ‘C’ Forms and ‘F’ Forms produced by the petitioner - refusal on the ground that the assessment had been completed - HELD THAT:- The Hon’ble Division Bench of the erstwhile High Court of Andhra Pradesh in the case of RAJESWARI STONE POLISHERS VERSUS STATE OF ANDHRA PRADESH [1982 (11) TMI 158 - ANDHRA PRADESH HIGH COURT]. The Hon’ble Division Bench, after considering the proviso had held that the dealer can file the said ‘C’ Forms at any time after making of the assessment as long as he is able to satisfy the authority about the sufficient cause why the ‘C’ Forms could not be filed within time.
This judgment was followed by another Hon’ble Division Bench of the erstwhile High Court of Andhra Pradesh in the case of GODREJ AGROVET LTD. VERSUS COMMERCIAL TAX OFFICER, ELURU, WEST GODAVARI DISTRICT & NOVARTIS HEALTH CARE PVT. LTD. (FORMERLY NOVARTIS NUTRITION INDIA PVT. LTD.) VERSUS COMMERCIAL TAX OFFICER, BENZ CIRCLE, VIJAYAWADA [2005 (10) TMI 516 - ANDHRA PRADESH HIGH COURT]. The Hon’ble Division Bench, in the subsequent judgment, had also held that the assessing authority need not wait for the ‘C’ Forms to be received before passing an assessment order, if there is a danger of limitation expiring for passing of such an assessment order. However, the assessing authority would have to consider any ‘C’ Forms filed subsequent to the assessment order, provided the dealer is able to make out sufficient cause while such ‘C’ Forms could not be filed within the time stipulated under Rule 12 (7) of the CST (R&T) rules. The Hon’ble Division Bench went on to hold that passing of an assessment order would not preclude the assessing authority from taking these into account and modifying the assessment order.
A perusal of the assessment order would show that the objections raised by the petitioner, in relation to the arithmetical or clerical mistakes in the order should also be considered as a prima facie reading of the order shows that there are various discrepancies in the figures and such discrepancies can be construed to be arithmetical or clerical mistakes.
This Writ Petition is disposed of directing the 1st respondent to consider the request of the petitioner to accept the ‘C’ Forms and ‘F’ Forms produced by the petitioner subject to the 1st respondent being satisfied that sufficient cause has been shown by the petitioner explaining the delay in filing these Forms.
............
|
9911796707
