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Showing 321 to 340 of 354 Records
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2003 (6) TMI 36
Issues involved: Determination of liability to pay service tax on residual process design and detailed engineering in a construction contract.
Summary:
The case involved a contract between M/s. Indian Oil Corporation Ltd. and M/s. Daelim Industrial Co. Ltd. for the construction of a diesel hydro-desulphurisation plant. The dispute arose when the Additional Commissioner of Central Excise issued a show cause notice holding the appellant liable to pay service tax on engineering services. The appellant contended that theirs was a construction contract and not an engineering consultancy service. Despite appeals, the duty demand was upheld. The main argument was that the contract was primarily for the construction of the desulphurisation plant, and the engineering services provided were incidental to the main objective.
The key issue in the appeal was whether consulting engineer services were involved in the contract. The contract details revealed that the project was for the construction, erection, and installation of the plant, with specific clauses outlining the responsibilities of the contractor. The contract was on a lump sum turnkey basis, and the appellant's role was focused on executing the construction work rather than providing consultancy services. The Tribunal concluded that the contract was a work contract and not a consultancy contract, emphasizing that a work contract cannot be dissected for the purpose of levying service tax.
Therefore, the Tribunal set aside the impugned orders, allowing the appeal and directing the return of any amount paid by the appellant to the department.
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2003 (6) TMI 35
Issues Involved:
1. Determination of Normal Value
2. Injury Analysis
3. Cooperation of the Exporter
Detailed Analysis:
1. Determination of Normal Value:
The appellants argued that the Designated Authority (DA) erroneously found that there was dumping of Acrylonitrile Butadiene Rubber (NBR) by them, asserting that a correct evaluation of their data would have shown no dumping. They contended that the DA should have worked out the correct cost of production from the data they provided instead of relying on other sources. The DA declared the appellant a non-cooperative exporter and determined the Normal Value based on "facts available" under Rule 6(8) of the Anti-dumping Rules. The DA noted discrepancies in the data provided, such as the appellant furnishing data for the financial year 1999 instead of the investigation period (April 1999 to March 2000) and inconsistencies in raw material costs. The DA also found issues with the allocation of Sales and General Administration Expenses (SGA) on a volume basis rather than a turnover basis, leading to a skewed picture of costing. Due to these discrepancies, the DA selectively utilized the appellant's data and adopted data from other sources to determine the Normal Value.
2. Injury Analysis:
The appellants contended that the injury analysis norms should be the same in both new and review investigations. They emphasized the improvement in the Domestic Industry's performance after the initial imposition of anti-dumping duty. The DA, however, argued that in a review proceeding, the standard of analysis is "recurrence." The DA's findings showed a significant increase in the appellant's exports and a steep fall in unit prices during the review period. The DA emphasized that the domestic industry continued to face intense price competition despite the anti-dumping duty. The DA's injury analysis was based on relevant parameters mentioned in Annexure II to the Anti-dumping Rules, concluding that price undercutting would lead to serious consequences if the duty were withdrawn. The Tribunal found the DA's injury analysis justified by the factual data presented.
3. Cooperation of the Exporter:
The DA treated the appellant as a non-cooperative exporter due to inadequate, contradictory, and irrelevant data provided. The DA noted that the appellant furnished data for the calendar year 1999 instead of the investigation period and failed to provide requested additional information promptly. The DA's compilation exposed discrepancies in raw material consumption data, price of raw materials, and NBR production. The appellant argued that they had diligently cooperated by responding to every letter from the DA and that the DA should have reverted to them if any information was found inadequate. The Tribunal found that the data provided by the appellant had gaps, discrepancies, and contradictions, justifying the DA's decision to treat them as a non-cooperative exporter and rely on data from other sources.
Conclusion:
The Tribunal concluded that the DA's determination of Normal Value based on "facts available" was justified due to the discrepancies and gaps in the data provided by the appellant. The injury analysis conducted by the DA was also found to be sound and justified by the factual data. Consequently, the appeals were rejected.
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2003 (6) TMI 33
Issues Involved:
1. Whether Om Prakash Punjabi is the real importer in all three imports.
2. Whether the goods imported under Bill of Entry dated 4-6-1993 in the name of R.K. International and Bill of Entry dated 21-7-1993 in the name of Natraj Metal Pvt. Ltd. contained ball bearings in the guise of lead scrap.
3. Whether the import of ball bearings was made in the guise of lead scrap or attempted to be made in the guise of lead scrap with the knowledge and connivance of the noticee officers.
4. The role and liability of various individuals and entities, including customs officials, in the smuggling operation.
5. The appropriateness of penalties imposed by the adjudicating authority.
Detailed Analysis:
1. Whether Om Prakash Punjabi is the real importer in all three imports:
The Revenue contended that Om Prakash Punjabi was the real importer behind the fictitious names M/s. Natraj Metal Pvt. Ltd. and M/s. Ram Metal Industries. The Tribunal found sufficient materials to connect Om Prakash Punjabi with the imports made in the name of these fictitious entities. Statements from Solly Perumal consistently implicated Om Prakash Punjabi, and independent evidence corroborated these claims. For instance, Solly Perumal's statements on 8-8-1993 and 1-1-1994 indicated that Om Prakash Punjabi was involved in the import operations, and these were corroborated by other witnesses like Kanthibhai and Suresh Kumar Dhoka.
2. Whether the goods imported under Bill of Entry dated 4-6-1993 in the name of R.K. International and Bill of Entry dated 21-7-1993 in the name of Natraj Metal Pvt. Ltd. contained ball bearings in the guise of lead scrap:
The Tribunal examined the evidence regarding the imports by R.K. International and Natraj Metal Pvt. Ltd. The Revenue raised doubts about the genuine nature of these imports, citing similarities with the consignment imported by Ram Metal Industries. However, the investigation failed to conclusively prove the presence of ball bearings in these consignments. The Tribunal noted the lack of conclusive proof and the failure to verify claims regarding the storage and disposal of the goods.
3. Whether the import of ball bearings was made in the guise of lead scrap or attempted to be made in the guise of lead scrap with the knowledge and connivance of the noticee officers:
The Tribunal found that the Revenue failed to prove conclusively the presence of ball bearings in the earlier consignments. Consequently, no liability could be fixed on the other noticees, including the officers allegedly involved in the smuggling operation. However, the conduct of some officers, such as Shri Mahendra Doshi, was found to be inappropriate and not befitting their office.
4. The role and liability of various individuals and entities, including customs officials, in the smuggling operation:
The Tribunal noted that there was evidence of close association between customs officials and the CHA, which was inappropriate given their duties. Specific instances of misconduct were highlighted, such as Shri Mahendra Doshi's involvement in the clearance of consignments and his travel with Solly Perumal. The Tribunal criticized the lack of proper coordination and direction in the investigation by the then Commissioner of Customs, Kandla.
5. The appropriateness of penalties imposed by the adjudicating authority:
The Tribunal upheld the penalty imposed on Om Prakash Punjabi, increasing it to Rs. 50 lakhs, considering the deliberate fraud and the value of the smuggled goods. The penalty on Solly Perumal was reduced from Rs. 25 lakhs to Rs. 5 lakhs, acknowledging his role as an agent and his inexperience in the business. The appeals filed by the Revenue were dismissed, except for the one involving Om Prakash Punjabi, which was allowed.
Conclusion:
The Tribunal concluded that Om Prakash Punjabi was the real importer behind the fictitious names and was liable for penal action. The evidence against other individuals and customs officials was insufficient to prove their involvement conclusively. The penalties were adjusted accordingly, with Om Prakash Punjabi facing a higher penalty and Solly Perumal receiving a reduced penalty. The Tribunal emphasized the need for proper conduct and coordination among customs officials in such cases.
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2003 (6) TMI 32
Issues involved:
The issue in this case is whether the running royalty of 5% payable by the importer to its foreign collaborator should be added to the invoice value of the imported goods.
Summary:
The appellant, a manufacturer of compressor valves, entered into a collaboration agreement with a foreign company for the manufacture of certain products. The agreement specified a royalty payment of 5% to 8% of the net selling price of the products manufactured and sold in India. The Customs department contended that this royalty was not related to the imported goods and was not a condition of sale. The Commissioner (Appeals) initially upheld the department's view based on a Supreme Court decision. However, the appellant challenged this decision.
The appellant argued that the royalty payment was not related to the imported goods and was not a condition of sale. The terms of the agreement indicated that the royalty was for the know-how granted for manufacturing certain products, and the payment was not a prerequisite for the sale of the imported goods. The Tribunal found that the Commissioner (Appeals) had incorrectly applied the Supreme Court decision and cited precedents where similar situations were dealt with differently. Consequently, the Tribunal set aside the impugned order and allowed the appeal in favor of the appellant, granting all consequential relief.
In conclusion, the Tribunal ruled in favor of the appellant, stating that the running royalty should not be added to the invoice price of the imported goods.
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2003 (6) TMI 31
Redemption fine - Valuation (Customs) - import of rough semi-precious stones - Whether authorities can direct confiscation of goods and payment of fine u/s 125 of the Customs Act, along with allowing re-export of goods, was referred to the Larger Bench due to conflicting views in previous Tribunal decisions - HELD THAT:- The provisions of section 125 are equally apply to the goods to be exported as well as imported goods. Where the goods which have been tendered for export are ordered to be confiscated and an option to redeem the goods on payment of fine, it would follow that option is for the export of the goods. This is no doubt different from re-export. Re-export is a facility permitting export of goods which have already been permitted to be imported. Except in cases where import is prohibited by any law, those goods which have been imported may be permitted to be exported. The formal procedure of filing a shipping bill and observing other formalities relating to export of goods would have to be followed. There is no prohibition on the adjudicating authority from permitting re-export of the goods. When an adjudicating authority after ordering confiscation of imported goods permits their re-export, he is in effect first ordering the redemption of the goods on payment of fine and thereafter permitting them to be re-exported. Each of these two actions is independent and is permitted by law. An order whereby both are combined, therefore, is not contrary to law.
We find that in reply to the show cause notice in para 5 the appellants specifically mentioned that supplier M/s. Lee Gems & Jewellery, Hongkong vide letter dated 15-3-2000 had agreed to supply the goods in question at a negotiated price. The appellants also produced a copy of the letter before the adjudicating authority. The appellants also produced copy of the letter dated 13-2-2002 where the supplier quoted the higher price which on negotiation was reduced. This evidence produced by the appellants is not taken into consideration while passing the impugned order by the learned Commissioner. The adjudicating authority in the impugned order held that the value declared by the Trade Panel Members appears to be an appropriate against the declared value.
We find that the learned Commissioner also held that the appellants failed to produce any documentary evidence in support of the transaction value in spite of the fact that the letters from the exporters were produced before him along with the reply to the show cause notice. In these circumstances, we find that the goods were imported at a negotiated price and the value was declared which was duly supported by the evidence by way of correspondence between the appellants and the exporters.
Therefore, the allegation of misdeclaration in terms of value is not sustainable. Hence, the impugned order is set aside and the appeal is allowed.
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2003 (6) TMI 30
Issues involved:
The appeal challenges the order regarding the addition of lump sum royalty and running royalty to the invoice value of imported goods under Rule 9(1)(c) of the Customs Valuation Rules, 1988.
Summary:
1. The appellant, a joint venture company, imported capital goods and raw materials for manufacturing exhaust systems under a cooperation and technical license agreement. The issue was whether the lump sum royalty and running royalty were required to be added to the invoice value of the imported goods.
2. The Deputy Commissioner initially accepted the invoice value after enhancing it by 20%, but this decision was set aside by the Commissioner (Appeals) due to a violation of natural justice principles.
3. On re-adjudication, the Deputy Commissioner held that the royalties were not required to be added to the value of the imported goods under the Customs Valuation Rules. However, the Commissioner (Appeals) disagreed, citing a Supreme Court decision and held that the royalties were related to the imported goods.
4. The appellant argued that the royalties were not related to the imported goods and referenced a previous Tribunal decision in a similar case. They also highlighted that most imports were from unconnected parties and that the royalty payment had not been made due to financial difficulties.
5. The Departmental Representative contended that considering the agreement as a whole, the royalties would cover the imported goods.
6. The Tribunal found merit in the appellant's argument, stating that the royalties were payable in connection with the manufacturing process and not the import of goods. They distinguished the case from the Supreme Court decision and held that the royalties were not required to be included in the invoice value.
7. The Commissioner (Appeals) was found to have erred in concluding that the appellant was bound to purchase from the foreign collaborator and in stating that all capital goods and raw materials were purchased only from them. The decision to include the royalty in the invoice value was set aside, and the appeal was allowed with consequential relief granted to the appellant.
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2003 (6) TMI 29
Issues:
1. Details of Deputy/Assistant Commissioners during specific periods.
2. Details of Commissioners holding charge during specific periods.
3. Directions issued to the Commissioners/Dy. Commissioners and Asstt. Commissioners to file affidavits regarding implementation of a Final Order.
Analysis:
1. The judgment provides a detailed list of Deputy/Assistant Commissioners along with their names, designations, periods of service from and to, and the division they were in charge of during the specified time frame. The list includes officers like Sh. B.L. Goel, Sh. R.K. Mishra, Sh. Akhilesh Pandey, Sh. Ranjit Kumar, and Sh. Rajendra Kumar, among others, highlighting their roles and timelines within the organization.
2. The judgment also outlines the details of Commissioners who held charge during specific periods. It mentions officers like M.S. Badhan, S.K. Goel, and Vineet Kumar, specifying the periods they were in charge, additional responsibilities they undertook, and their current postings. The judgment emphasizes the responsibilities and additional charges assigned to these Commissioners, particularly focusing on their roles within the Central Excise Commissionerate in Ghaziabad.
3. Furthermore, the judgment issues a notice to the aforementioned Commissioners/Dy. Commissioners and Asstt. Commissioners, directing them to file affidavits detailing the steps taken to implement a Final Order passed by the Tribunal. The notice specifies the deadlines for filing the affidavits and schedules the cases for further orders on a specific date. The judgment ensures that the concerned officers are served with copies of earlier orders related to the proceedings, emphasizing the importance of compliance and accountability in implementing the Tribunal's directives.
This comprehensive analysis of the judgment highlights the meticulous documentation of officer details, responsibilities, and directives issued by the Tribunal, underscoring the significance of adherence to legal procedures and accountability within the customs and central excise framework.
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2003 (6) TMI 28
The Appellate Tribunal CESTAT, New Delhi ordered the return of excess customs duty, redemption fine, and penalty totaling Rs. 7,15,350 with 12% interest. The Commissioner's delay in implementing the order was not justified, and responsibility will be fixed later.
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2003 (6) TMI 27
The Appellate Tribunal CESTAT, New Delhi, in a case involving a refund claim, found that the department had acted on legal advice in not considering the claim initially. Once the correct position was clarified, the applicant was granted a refund of Rs. 11,87,317/- with interest. The Tribunal dismissed the Misc. Application as the officers had acted in good faith based on legal advice.
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2003 (6) TMI 26
Demand/Recovery - Duty liability - short-levy of the excise duty - recovery of the dues once - manufacturer or the warehouse keeper or the purchaser - HELD THAT:- We have to ascribe meaning to the person, taking into account the broad concept as well. This is case of short-levy of duty. The proceedings can be continued against the manufacturer if he had moved the products paying the duty less than what is liable under the Act. Obviously he has to pay the balance duty as well, if there was a short-levy. This demand has to be met, if it remains unpaid by the legal representatives even after the death of their predecessor-in-interest. This is a case where the short-levy has been noticed during the life of their predecessor.
Suppose there had been a case of excess levy from the predecessor-in-interest. If the argument advanced by the learned Counsel for the writ petitioners is accepted, it will lead to a situation that the legal representatives of a manufacturer who had paid more duty, than is necessarily payable under the Act will be disabled to claim excess amount paid by their predecessor. The law will not create such an anomalous position. Therefore the liability as well as entitlement has to be viewed in the same angle with reference to the death of the predecessor-in-interest.
There is another moral principle behind it as well. If the manufacturer concerned had become unlawfully enriched, because of non-payment of Excise duty or short-levy of excise duty due to some mistake on the part of the Taxing Officer, that enrichment, after his death falls upon his legal representatives, in this case, the writ petitioners. The law will not permit unlawful enrichment. Such interpretation does not in any way militate against any provision at all. Accordingly, we set aside the judgment and hold that the proceedings as per Ext. P4 shall be proceeded with.
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2003 (6) TMI 25
Refund the excess customs duty paid - Protest - manufacturing of industrial chemicals - HELD THAT:- The import of machinery is not by any individual or by Government or educational or charitable institution and hence the limitation for making claim of refund of duty is before the expiry of six months from the date of payment of duty. Admittedly, the petitioner has not paid the duty under protest and the second proviso will not apply to the case of the petitioner. During the course of argument, Mr. P.S. Raman, learned Counsel for the petitioner, referred to the decision of Apex Court in Mafatlal Industries Limited v. Union of India [1996 (12) TMI 50 - SUPREME COURT]. The Constitutional Bench of the Supreme Court, while dealing with the claim for refund under Section 11B of the Central Excise Act,
Admittedly, in the present case, the petitioner has not made the payment of duty under protest and in that case, the period of limitation of six months will apply to the petitioner and the claim not being made within a period of six months from the date of payment has been rightly rejected by the respondent.
There are no merits in the writ petition. The writ petition is dismissed. No costs.
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2003 (6) TMI 24
Notice issued under section 147 read with section 148 - challenge to the notices is mainly on the ground that these have been issued after the expiry of four years from the end of the relevant assessment year even though the conditions as contemplated under section 147 of the Act were not satisfied. - the impugned notices dated May 29, 2001, issued under section 147 read with section 148 of the Act are without jurisdiction as the conditions precedent to reopen the assessment in terms of the proviso to section 147 are totally non-existent and, therefore, we allow the petition and quash the impugned notices.
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2003 (6) TMI 23
"Whether, on the facts and in the circumstances of the case, the Tribunal was correct in upholding the order of the Commissioner of Income-tax (Appeals) in allowing exemption under section 54E of the Income-tax Act, 1961, on gains arising out of transfer of depreciated assets, when unabsorbed depreciation of earlier years was claimed and allowed to be set off?" - whether the assessee who has claimed and allowed depreciation on capital assets is entitled for benefits under the provisions of section 54E and claimed deduction while calculating his income or by virtue of section 50 - question is answered in favour of the assessee and it is held that the assessee is entitled for exemption or deduction as provided under section 54E of the Income-tax Act on capital gains.
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2003 (6) TMI 22
Whether a building of a cold storage is a plant. Revenue, had sought to draw a distinction between a plant and a building. According to him, if it is a setting or canopy for sheltering a particular business, then it would not be a plant. The building has a more durability than a plant. Therefore, only the thermocole part of the building is the plant and not the rest. - we remit the matter to the learned Tribunal for deciding the case afresh in the light of the observation as made hereinabove in order to allow at 33.33 per cent. on the part of the cold storage building housing the chambers, after giving opportunity to the parties.
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2003 (6) TMI 21
The question involved in these appeals is whether the building in question is a "plant" and therefore the assessee is entitled to claim higher rate of depreciation. - we hold that the building in question is a plant and therefore the assessee is entitled to higher rate of depreciation as claimed by him. The appeals are allowed
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2003 (6) TMI 20
Non-resident - In the writ petition the petitioners have challenged two notices. One dated passed by the Deputy Commissioner of Income-tax. treating CESC Limited as "representative assessee"/"agent" of the non-resident assessee, u/s 163 of the Income-tax Act, 1961. The other notice is dated March 20, 2001, passed by the same officer under section 148 seeking to reopen the assessment - In the result, this appeal succeeds in part only with regard to the notice under section 148 relating to reopening of the assessment under section 147 on the ground that this notice was issued on March 20, 2001, when the return submitted by the principal was pending and the assessment whereof was not completed till March 30, 2001. The notice, dated March 20, 2001, issued under section 148 impugned in the writ petition is, therefore, hereby quashed
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2003 (6) TMI 19
By this writ application the writ petitioner has challenged an order, passed by the Settlement Commission refusing to entertain the case on the ground that the failure on the part of the petitioner in deducting tax at source does not come within the purview of section 245C(1) - I am unable to accept the contentions of the learned advocate for the petitioner that for the purpose of assessing the jurisdiction of the Commission the provisions contained in section 245C(1) of the Act should be ignored. I thus find that the Commission rightly refused to entertain the application filed by the petitioner as it had no jurisdiction to entertain the dispute involved. The writ application is thus devoid of any substance and is dismissed accordingly.
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2003 (6) TMI 18
Reassessment notice – exclusion from limitation - A time bared assessment cannot be reopened in the absence of any specific power available to the Revenue in the matter of reassessment. As observed by the apex court, finality has to be at one stage or the other. - These petitions are allowed. The impugned notices are set aside. A direction is issued to the respondent not to proceed further in the given circumstances by way of reopening of the assessment proceedings
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2003 (6) TMI 17
"Whether, in law and on facts, the assessee is entitled to depreciation at the rate of 30 per cent. on two items, namely, (1) hot mixing plant, and (2) paver finishing machine used by the assessee in its activity of road building ?" - The Tribunal was not right when it allowed the appeal and directed the Income-tax Officer to grant depreciation at 30 per cent. in respect of the said machineries. - We answer the question in the negative, i.e., in favour of the Revenue and against the assessee.
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2003 (6) TMI 16
Share transactions – loss - assessee has placed on record to indicate that all the share transactions entered into by the assessee-companies have been supported by contract notes and bills of recognized share brokers of stock exchange and also other documentary evidence showing that all the payments have been made/received through account payee cheques or drafts - no evidence on record placed by the Revenue to indicate that the disputed share transactions have been entered into between parties, who are close relatives or friends or the persons having common interests, nor there is any material placed on record to indicate that the share transactions have been entered in to between the same parties adopting the same modus operandi for a reasonable span of period – Held that share transactions were genuine and the assessee-companies are entitled to claim benefit under those transactions for the loss suffered
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