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Showing 261 to 280 of 1167 Records
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2012 (7) TMI 915
Issues involved: Service tax demand on management, maintenance, and repair services of immovable property.
Summary:
The judgment by the Appellate Tribunal CESTAT MUMBAI addressed a service tax demand of Rs. 3,58,22,777/- u/s the Finance Act, 1994, confirmed against the applicants for management, maintenance, and repair services of immovable property from June 2005 to March 2010. The applicant argued that they modified their contracts post the introduction of the service tax levy in June 2005, paying tax on maintenance activities but not on the operation of the power plant. Citing precedents like Hyundai Heavy Industries Co. vs. CCE, Wartsila India Ltd. vs. CCE, and Operational Energy group India Pvt. Ltd. vs. CCE, the Tribunal agreed that the operation of a power plant does not fall under the category of management, maintenance, and repair services, granting a stay on the demand. The Revenue contended that the applicant's activities constituted management and maintenance of the power plant, advocating for a pre-deposit. After hearing both sides and examining the contract clauses, the Tribunal found that the applicant was only liable for service tax on maintenance activities, not on operational activities. Relying on the cited decisions, the Tribunal granted a stay on the requirement of pre-deposit and recovery during the appeal's pendency.
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2012 (7) TMI 914
The Gujarat High Court heard an appeal regarding substantial questions of law, including issues related to cross-examination of witnesses, serving of documents, weighing of inputs, and providing supporting documents for show cause notice. The court admitted the appeal and issued notice to the respondents for filing the paper book within three months. (2012 (7) TMI 914 - GUJARAT HIGH COURT)
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2012 (7) TMI 913
Whether the Ld. CIT(A) was right in allowing relief on account of deduction u/s 80IB on Central Excise Duty - Held YES . See Shree Balaji Alloys v. CIT and Another(2011 (1) TMI 394 - Jammu and Kashmir High Court ) by holding that the Excise Duty refund is to be treated as ‘capital receipt’ and not liable to be taxed.
Disallowance made u/s 40(a)(ia) on TDS default - HeLd that:- The issue in dispute is decided in favour of the assessee and against the Revenue.
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2012 (7) TMI 912
Waiver of pre-deposit - Penalty - Rule 15(2) of Cenvat Credit Rules, 2004 - Held that: - the applicants are not serious to pursue their stay petitions. Therefore the applicants are directed to make 50% of the duty demanded in each case within 8(eight) weeks and report compliance on 12.09.2012. On compliance the pre-deposit of remaining dues adjudged would stand waived and recovery thereof would stand stayed during pendency of the appeal - Appeal dismissed.
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2012 (7) TMI 911
Issues involved: Appeal against order of CIT(A) for A.Y. 2005-2006 regarding addition u/s 69B and disallowance u/s 69B.
Addition u/s 69B:
The appellant Revenue challenged the deletion of addition of Rs. 1,69,83,383 made by the A.O. u/s 69B, arguing that the deletion contradicted findings in the CIT(A)'s order. The dispute arose from the variance in valuation certificates for construction costs. The CIT(A) found that the actual amount spent on the project was Rs. 12.96 crores, including Rs. 3.95 crores on the 2nd and 3rd floors, whereas the projected cost in the second valuation certificate was Rs. 5.65 crores. The Tribunal upheld the CIT(A)'s decision, stating that the A.O. was wrong in presuming the entire projected cost had been spent before 31.3.2005.
Disallowance u/s 69B:
The Revenue also contested the deletion of disallowance of Rs. 1,50,00,000 made u/s 69B, arguing that the CIT(A) did not fully address the AO's contentions. However, the CIT(A) reconciled the loan amounts and found no basis for the significant addition made by the AO. The Tribunal upheld the CIT(A)'s decision to delete the disallowance, noting that the A.O. had erred in the calculation, adding Rs. 1,50,00,000 instead of Rs. 1,55,00,000. The Tribunal dismissed the Revenue's appeal.
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2012 (7) TMI 910
Issues Involved:
1. Legality of the quashing of charge sheets dated 12th November 1999 and 11th October 2004.
2. Delay in the disciplinary proceedings and its impact on the respondent's career and promotions.
3. Procedural irregularities in the disciplinary proceedings and adherence to CCS (Conduct) Rules, 1964.
Summary:
Issue 1: Legality of the Quashing of Charge Sheets
The petitioners challenged the judgment of the Central Administrative Tribunal (CAT) which quashed the charge sheets dated 12th November 1999 and 11th October 2004 against the respondent. The CAT directed the petitioners to open the sealed cover concerning the respondent's promotion and, if found fit, to promote him with all consequential benefits. The CAT concluded that the respondent was given a raw deal by prolonging the departmental inquiries without any cogent and rationally acceptable explanations, causing great prejudice to the respondent.
Issue 2: Delay in the Disciplinary Proceedings
The CAT observed that the disciplinary proceedings against the respondent were unduly delayed, spanning over a decade, which caused significant prejudice to the respondent. The inquiry reports for the charge sheets were completed on 29th September 2008 and 26th December 2008, respectively. The CAT noted that the delay was not satisfactorily explained by the petitioners, and the respondent had suffered immensely due to the inordinate delay, as he was denied promotions and had to wait for final orders on the charge sheets.
Issue 3: Procedural Irregularities
The CAT found that the disciplinary proceedings were hurriedly concluded by the petitioners in violation of procedural requirements. The CAT noted that the respondent was not given a chance to represent his case properly against the findings of the Enquiry Officer. The CAT also observed that the charges against the respondent were not of a serious nature involving moral turpitude or mala fides but were related to procedural irregularities. The Enquiry Officer had found that the charges were either not proved or only technically proved without substantial evidence.
Conclusion:
The High Court upheld the CAT's decision, noting that the disciplinary proceedings were unduly delayed without satisfactory explanation, causing significant prejudice to the respondent. The charges were primarily related to procedural irregularities without any evidence of moral turpitude or mala fides. The High Court dismissed the writ petition and imposed a cost of Rs. 30,000 on the petitioners for the hardships and miseries suffered by the respondent.
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2012 (7) TMI 909
The Calcutta High Court dismissed an application for condonation of delay exceeding 60 days, citing a previous judgment. The delay in this case was about 96 days. The appeal related to the application was also dismissed.
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2012 (7) TMI 908
Addition u/s 145 - Held that:- According to section 145(1), income chargeable under the head ‘profit and gains of business’ shall be computed in accordance with the method of accountancy adopted by an assessee subject to the conditions enumerated in sub-sections (2) (3) of section 145. It means that the AO has to determine the income in accordance with the method of accounting adopted by an assessee, provided that method enabled the Assessing Officer to deduce the true income of an assessee.
If it emerges out from the record that on the basis of the account maintained by an assessee, it is not possible to deduce true income then he can resort the estimation of the profit. In the present case, the assessee was not maintaining stock register quality-wise. In the absence of such details, it is quite difficult what type of paddy the assessee has purchased which was converted into rice. The assessee can easily manipulate the purchases as well as the sales in the absence of the quality-wise details. AO has rightly rejected the book results and made an ad hoc addition.
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2012 (7) TMI 907
Issues involved:
The issue involved in this case is whether the appellant, a manufacturer of Polyester Filament Yarn, was required to pay duty u/s Rule 57 S(2)(c) of Central Excise Rules, 1944 for clearing scrap of Iron, Steel, and Cable without payment of duty during the period from September 1994 to September 1998.
Details of the Judgment:
Issue 1: Duty payment on clearance of scrap
The Department contended that duty was required to be paid on the clearance of scrap under Rule 57 S(2)(c) as it was old and used capital goods for which modvat credit had been taken. A show cause notice was issued for demand of duty, interest, and penalty. The Addl. Commissioner confirmed the demand and imposed a penalty. The Commissioner (Appeals) upheld this decision, leading to the appeal.
Issue 2: Arguments of the Appellant
The appellant argued that the scrap cleared was not used in respect of any cenvatable item. They claimed that the scrap, including steel, iron, M.S. Scrap, Aluminium Scrap, and cable scrap, did not relate to capital goods for which modvat credit was taken. They asserted that Rule 57S(2)(c) did not apply as they had not availed modvat credit on the capital goods sold as scrap.
Issue 3: Arguments of the Revenue
The Revenue argued in support of the impugned order, stating that the appellant's plea was an afterthought without substantiating evidence. They claimed that the appellant did not provide evidence to show that they had not availed modvat credit on the goods resulting in the cleared scrap.
Judgment
The Commissioner (Appeals) found the scrap marketable and liable to duty, invoking the extended period of limitation due to non-compliance with Central Excise Rules. However, the Commissioner did not address the appellant's argument regarding Rule 57 S(2)(c) applicability or the origin of the scrap. As neither the original nor appellate authority determined if modvat credit was taken on the original items sold as scrap, the Tribunal could not accept the Department's contention. Despite the usual remand for fresh adjudication, the lengthy period since the show cause notice made evidence availability unlikely. Consequently, the Tribunal set aside the impugned order, accepting the appeal.
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2012 (7) TMI 906
Issues involved: Challenge against the order transferring the case under Section 127(2) of the Income Tax Act, 1961 and the assessment notices.
Transfer Order Challenge:
The petitioner challenged the transfer order under Section 127(2) of the Income Tax Act, 1961, from ITO, Ward-1, Shimoga to DCIT, Central Circle-1(2), Pune, citing lack of proper notice and absence of reasons for the transfer. The main contention was the necessity of a valid notice before such transfers, as highlighted in previous judgments emphasizing the importance of reasons for transfer and the right to fair hearing. The petitioner argued that the notice received did not provide adequate information for effective representation against the transfer, rendering the order unsustainable in law.
Legal Precedents:
Reference was made to previous judgments emphasizing the significance of a valid notice in administrative adjudication processes. The judgments stressed the importance of clear and precise notices, stating reasons for actions, and providing the party concerned with sufficient information to present an effective defense. The adequacy of notice was highlighted as a crucial element of natural justice and good administration, ensuring fairness and the opportunity to rebut evidence.
Judgment and Order:
The High Court held that the notice received by the petitioner prior to the transfer order was inadequate as it lacked reasons for the proposed transfer, failing to enable effective representation. Consequently, the court set aside the impugned transfer order and the assessment notices. The respondent was directed to issue a proper notice to the petitioner and take action in accordance with the law. The writ petitions were disposed of accordingly, with an additional order regarding the interim stay application.
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2012 (7) TMI 905
Waiver of pre-deposit, interest, penalty - The case of the Revenue is that bagasse and press mud are excisable goods, and the manufacturer of sugar and molasses are not maintaining separate records hence, as per the provisions of Rule 6 of the CENVAT Credit Rules, 2004, the manufacturer has to pay 5%-10% of the price of the exempted goods i.e. bagasse and press mud - Held that: - It may be noted that crushing of sugarcane is necessary to extract can sugar juice which in turn is processed for production of sugar and molasses - Thus, in our considered view, the amendment in Finance Act, cited by Shri Nagesh Pathak, AR and the Board Circular would not make any difference in the facts and, circumstances of the case. Moreover, neither the show-cause notice nor the impugned order in appeal mentions as to which common CENVAT credit availed inputs have been used in manufacture of sugar and molasses (dutiable final products) and bagasse (exempted final product). Since Bagasse emerges at sugarcane crushing stage, there is no possibility of any input-chemicals etc. having been used at that stage.
The expression exempted goods has been defined for the purpose of CENVAT Credit Rules in Rule 2(d) to mean excisable goods which are exempt from the whole of duty of excise leviable thereon and includes goods which are chargeable to nil rate of duty. As per this definition, the impugned goods namely press mud and sludge would be covered under the definition exempted goods , though the same cannot be treated as excisable goods for the reasons stated in paragraph 5 above. The question raised in this case is whether in terms of Rule 6(3)(i), an amount equal to 10% / 5% would be payable on such goods.
Considering the precedent decisions cited above, Board’s Manual provisions as well as Board’s circular cited above, I am of the view that the demand of 10% / 5% on press mud and sludge, which are in the nature of by-product and waste and also non-excisable cannot be sustained - Appeal allowed.
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2012 (7) TMI 904
Waiver of pre-deposit - Notification No. 01/2006-ST dated 1.3.2006 - Finishing and Completion Service - As the applicant has not produced any evidence in respect of the goods and raw materials sold, before the adjudicating authority and in the present appeal, therefore, prima facie we find merit in the contention of the Revenue that the applicants are not entitled for the benefit of the Notification. Taking into the facts and circumstances of the case, the applicants are directed to deposit Rs One crore fifty lakhs only within eight weeks eight weeks and report compliance on 25.10.2012 - Decided against the assessee.
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2012 (7) TMI 903
Issues involved: The judgment addresses the following common issues: i) Whether the deduction of expenses as an application of income, rather than expenditure incurred for earning income, is justified; ii) Whether allowing expenditure is justified when the assessee is not registered u/s 12A and not entitled to exemption u/s 11.
Details of the judgment:
Issue i) Deduction of expenses as an application of income:
The assessee, registered under the Societies Registration Act, sought exemption under u/s 10(23C) of the Income Tax Act until 2002-03. Subsequently, the respondent applied for registration u/s 12A from 2003-04 onwards. Despite facing initial rejection, registration was granted w.e.f. 1.4.2005. The appellant claimed expenses for promoting sports in various assessment years, which the AO initially denied due to lack of u/s 12A registration. However, the Ld. CIT(A) allowed the claimed expenses, emphasizing the legitimate nature of the expenditure incurred for sports activities.
Issue ii) Expenditure allowance without u/s 12A registration:
The Ld. DR contended that without u/s 12A registration, the assessee was ineligible for benefits under sections 11 and 12 of the Act, citing a Supreme Court decision. In response, the Ld. AR supported the first appellate order, highlighting the application of income towards sports promotion. The Ld. CIT(A) found that the expenses were genuine and related to sports activities, supported by documentary evidence and accounting details. While the principle of mutuality was raised, the Ld. CIT(A) did not apply it in this case. The judgment upheld the Ld. CIT(A)'s decision, emphasizing the genuineness of the claimed expenses for sports activities.
Conclusion:
The judgment concluded that the Ld. CIT(A) did not grant benefits under sections 11 & 12, making the Supreme Court's precedent on u/s 12A registration inapplicable. As the claimed expenses were found legitimate and related to sports activities, the revenue's appeals were deemed untenable. The judgment rejected the appeals and upheld the decision of the Ld. CIT(A) in favor of the respondent.
Separate Judgment: No separate judgment was delivered by the judges.
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2012 (7) TMI 902
Issues:
Whether CENVAT credit of Basic Excise Duty can be utilized for payment of education Cess.
Analysis:
The appeal was filed by the revenue under Section 35G of the Central Excise Act, 1944, questioning the utilization of CENVAT credit of Basic Excise Duty for education Cess payment. The issue was whether the assessee could use this credit for such payment. The appellants referred to a previous judgment where a similar question was addressed. The Court observed that Rule 3(7) limits the utilization of CENVAT credit for specific duties, but it does not restrict the use of credit from other sources for payment of a particular duty. The Court concluded that the Commissioner was mistaken in disallowing the utilization of CENVAT credit of Basic Excise Duty for NCC duty.
In the present case, the assessee used CENVAT Credit of Basic Excise duty for education Cess payment, which was objected to by the department. The Adjudicating authority held that such credit could not be used for education Cess payment and deducted the amount from the refund owed to the assessee. However, the revision petition under Section 35EE of the Act favored the assessee's action, stating that utilizing CENVAT Credit for education Cess payment on exempted final products was correct as education cess is also a duty of excise. The Tribunal upheld this view, emphasizing that there was no prohibition on using CENVAT Credit of Basic Excise Duty for education Cess payment.
The Tribunal's decision aligned with the Court's previous judgment, which allowed the utilization of CENVAT credit from various sources for payment of specific duties. Consequently, the Court dismissed the appeal, affirming the Tribunal's decision that there was no legal impediment to using CENVAT Credit of Basic Excise Duty for education Cess payment.
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2012 (7) TMI 901
The High Court of Rajasthan dismissed stay application No. 15909/2011 regarding the order dated 30th Nov., 2010 passed by CESTAT.
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2012 (7) TMI 900
Issues Involved:
The issue involved in this case is whether relief under Section 129E was impermissible and if the circular relied upon was in conflict with the CENVAT and duty drawback scheme and provisions of the Act and Rules applicable.
Judgment Details:
Issue 1: Relief under Section 129E and Interpretation of Circular
The appellant, a merchant exporter, claimed benefit under a circular for relief of set off of the duty component available through the prevalent duty drawback scheme. The Tribunal held that the circular was contrary to the statute and relief could only be granted to the extent of drawback on customs, not excise duty. The appellant argued that the Tribunal erred in not giving primacy to the circular and that the order was contrary to the circular, causing financial hardship. The Court noted that the appellant had arranged its affairs based on the circular and had not evaded duty payment. The Court found the Tribunal's view plausible but favored the appellant due to the circular's interpretation. Considering past favorable decisions and to serve justice, the Court ordered the appellant to deposit 30% of the duty payable instead of the 100% directed by the Tribunal, with adjustment of the amount already paid.
Issue 2: Payment of Duty and Security
The Court partially allowed the appeal, directing the appellant to deposit 30% of the duty payable within 6 weeks, excluding interest and duty, while furnishing security to the Assessing Officer to the satisfaction, excluding a bank guarantee.
This judgment addressed the conflict between the circular providing relief under Section 129E and the Tribunal's interpretation, ultimately granting partial relief to the appellant based on the circumstances and past favorable decisions.
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2012 (7) TMI 899
The Appellate Tribunal CESTAT Mumbai confirmed a service tax of Rs. 1,47,18,765 against the applicant for the period April 2006 to July 2008 and February 2009 to March 2010 for banking charges paid to foreign bankers. The Tribunal waived the requirement of pre-deposit of the entire amount during the appeal, following a similar decision in the case of Reliance Industries Ltd.
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2012 (7) TMI 898
Issues involved: Interpretation of clauses 4 and 5 of Notification No. 8/2003-C.E., dated 1st March 2003 for exemption benefit and clearance of goods with another brand name. Maintainability of appeal under Section 35G of the Central Excise Act, 1944.
Interpretation of Notification No. 8/2003-C.E.: The Tribunal was questioned for misinterpreting clauses 4 and 5 of the notification, allowing exemption benefit despite goods being cleared with another brand name. The issue pertained to whether the product can be marketed under only one brand name, and the Tribunal's decision to extend SSI exemption benefit to the respondent was challenged. The contention was that goods bearing a brand name/trade name of another person would not qualify for SSI exemption.
Maintainability of Appeal: The respondent's counsel objected to the maintainability of the appeal under Section 35G of the Central Excise Act, 1944, arguing that the determination of the question involved the rate of duty of Excise or the value of goods for assessment, making it appropriate for appeal under Section 35L before the Supreme Court. Citing a precedent from Navin Chemicals Mfg. & Trading Co. Ltd. v. Collector of Customs, it was highlighted that questions relating to the rate of duty, valuation of goods, classification of goods under the Tariff, and exemption notifications fall within the scope of determination for assessment purposes.
Decision: The High Court concluded that the Tax Appeal was not maintainable under Section 35G of the Central Excise Act, 1944, as the issue related to the determination of rates of duty payable by the respondent, falling within the ambit of Section 35L for adjudication by the Supreme Court. The appeal was dismissed with the liberty for the appellant to file an appropriate appeal under Section 35L before the Hon'ble Supreme Court for further consideration.
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2012 (7) TMI 897
Issues Involved:1. Fraudulent Availment of Cenvat Credit 2. Allegations of Collusion and Conspiracy 3. Tribunal's Oversimplification of the Case 4. Remand for Fresh Decision by Tribunal Summary:Fraudulent Availment of Cenvat Credit: The appeal was filed u/s 35G of the Central Excise Act, 1944, challenging the CESTAT's order dated 21.07.2009/31.07.2009. The respondent had taken Cenvat Credit of Rs. 3.86 Lakhs based on invoices from M/s Nerka Chemicals Pvt. Ltd., which were found to be fabricated, as no duty was paid by the manufacturer, M/s N.H.Harsora Pvt. Ltd. The Additional Commissioner ordered recovery of Rs. 7.72 Lakhs, which was upheld by the Commissioner (Appeals). However, the Tribunal allowed the respondent's appeal, stating that the proceedings should have been initiated against the manufacturer. Allegations of Collusion and Conspiracy: The department alleged that the respondent, along with M/s N.H.Harsora and M/s Nerka Chemicals, engaged in a conspiracy to avail Cenvat Credit fraudulently. Investigations revealed that the respondent availed credit based on fake invoices, leading to wrongful availment of Rs. 7.72 Lakhs in Cenvat Credit. The adjudicating authority concluded that the respondent was part of a pre-planned conspiracy involving illicit removal of goods and wrongful availment of Cenvat Credit. Tribunal's Oversimplification of the Case: The Tribunal's decision was based on the premise that the respondent could not be expected to verify if the dealer had availed credit or if the manufacturer had discharged duty liability. The Tribunal held that the remedy lay in initiating proceedings against the manufacturer. However, this Court found that the Tribunal oversimplified the case by ignoring allegations of fraud and collusion and failing to discuss the merits of the case in detail. Remand for Fresh Decision by Tribunal: This Court remanded the matter to the Tribunal for a fresh decision, emphasizing that the Tribunal should comprehensively address the factual aspects and allegations of fraud and collusion. The Tribunal is directed to decide the matter afresh by 30th April 2013, without being influenced by its earlier order or this Court's observations. The substantial question of law is answered accordingly, and the appeal is allowed to the extent of remanding the case for a fresh decision.
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2012 (7) TMI 896
Condonation of delay - Whether Tribunal was justified in non-suiting the appellant on the ground that Commissioner (Appeals) had no power to condone the delay beyond 30 days - Whether approach of the Tribunal in regard to condonation of delay of 120 days in filing the appeal before Commissioner (Appeals), is sustainable in law - Whether withdrawal of the second notice dated 14-12-2001, did not constitute sufficient cause for the Appellant not to pursue the matter any further? This resulted in filing of the appeal after a delay of 120 days?
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