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Showing 381 to 400 of 1914 Records
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2016 (12) TMI 1536
Pre-deposit - Business auxiliary service - commission agent service - The agreement entered into with M/s Hyundai Motors no doubt provides that the appellant has to actively and vigorously promote Hyundai products. They are also required to undertake servicing of Hyundai vehicles - is the service classified under business auxiliary services? - Held that: - The important aspect of definition of commission agent is that there should be a relationship of agent and principal with the appellant acting as agent of M/s Hyundai Motors. A perusal of the agreement entered into by the appellant with M/s Hyundai Motors, reveals that it has been made on principal to principal basis - Prima facie, it appears that the levy of service tax does not appear to be sustainable especially in view of the fact that the relationship between the appellant and M/s Hyundai Motors are on principal to principal basis - the case merits waiver of pre-deposit in full - appeal allowed - waiver of pre-deposit granted till disposal of the appeal.
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2016 (12) TMI 1535
Business Auxiliary Services - services of brand promotion of ‘INTEL' and ‘MICROSOFT' - activity of ‘promotion or marketing of logo or brand' - the advertisements of computers (the Appellants final products), carrying a foot note “Intel Inside” and “Microsoft Windows” logos, belonging to their respective owners - advertisement expenses is received from Intel and Microsoft? - suppression of facts - extended period of limitation - levy of penalty - difference of opinion - 3rd member decision
Held that:- We need not concern ourselves with all the specific activities enumerated in section 65(19) and may restrict ourselves to that of ‘promotion or marketing or sale of goods produced or provided by or belonging to the client’.
A question that arises is whether the two supplies benefit in any manner from the inclusion of their logos in the advertisement and publicity material deployed by the appellants. In scale and reputation, appellants are incomparable with the two global giants. It is difficult to conceive that the products of these two entities will find additional acceptability in the market owing to the inclusion of their respective logos. The products themselves are amenable to utilization only by computer manufacturers and the publicity, if any, among the potential customers of the two appellants is unlikely to derive any economic benefits to the supplier.
At best, it may be surmised that the scheme incentivizes the appellants to procure more products from the two suppliers and to enhance the sales of the computers manufactured by the two appellants. Such a benefit to the appellants would not qualify as promotion of product of client. Indeed, the impugned order should have ascertained the existence of a client-provider relationship between the appellants and the two suppliers along the nature of the fiscal flow accruing to the appellants as a prelude to determining the taxability.
The activity of ‘promotion or marketing of logo or brand’ does not cover under the category of Business Auxiliary Service - In view of the judgment in the case of Jetlite (India) Ltd. [2010 (12) TMI 40 - CESTAT, NEW DELHI], demand set aside - decided in favor of appellant.
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2016 (12) TMI 1534
Default u/s 201(1) - failure to deduct TDS - liability to pay interest u/s 201(1A) if the payee of such amounts has files a nil return or a return showing a loss - Held that:- We will presume that the first proviso to sub section (1) operates retrospectively and that the proviso to sub section (1A) does not. As the amendment of 2009 is with effect from 01.07.2010, a question may arise in a given case whether it applies only from the next assessment year i.e. From 01.04.2011 or whether it applies to the assessment year 2010-11 only from 01.07.2010 and prior to that i.e. From 01.04.2009 to 30.06.2010 the unamended provisions applies. The issue, however, does not affect the result of this appeal.
Even if the proviso to sub section (1) is not retrospective, it would make no difference to the assessee's case in view of the judgment of the Supreme Court in Hindustan Coca Cola Beverage P. Ltd. vs. Commissioner of Income Tax [2007 (8) TMI 12 - SUPREME COURT OF INDIA ].The last sentence makes it clear that even if the deductee assessee has paid the tax dues, it would not alter the liability to charge interest under Section 201(1A) till the date of payment of taxes by the deductee assessee. It is further held that the same would not even affect the liability for penalty under Section 271C. Thus, even prior to the amendment on 1st July, 2012, the liability to pay interest under Section 201 (1A) was there even in cases where the deductee assessee had paid the tax dues.
The language of Section 201 is clear and unqualified. It indeed does not permit an assessee to decide for itself what the liability of the deductee assessee is or is likely to be. That is a matter for the assessing officer who assesses the returns of the deductee assessee. It is in fact not even possible for him to do so. He cannot ascertain with any degree of certainty as to the financial position of the deductee assessee. A view to the contrary would enable an assessee to prolong the matter indefinitely. If accepted, it may even entitle the assessee to contend that it is not liable to pay interest till the finalisation of the assessment of the deductee assessee. This could never have been contemplated by the Legislature. The language of Section 201 does not even suggest such an intention.
Even if the assessee is in a position to ascertain the tax liability of the deductee assessee, it would make no difference for the reasons already stated. The section does not distinguish between cases where an assessee is in a position to determine the tax liability of the deductee assessee and cases where it is not in a position to do so.
The terminal point has to be taken as a date on which the payee/deductee should have filed returns. Thus, even before and de hors the amendment of 1st July, 2012, the assessee would be liable to pay interest under Section 201(1A). The amendment which introduced inter-alia the first proviso to Section 201(1) is of no assistance to the assessee either.
Section 197 establishes that where the deductor assessee wishes to reduce its liability on account of a possible absence of liability or a reduced liability of the deductee assessee, the deductee assessee must obtain a certificate. In the event of such a certificate being issued in favour of the deductee assessee, the person responsible for paying the income i.e. the deductor assessee would be entitled to deduct tax at the rates specified in such certificate or deduct no tax as the case may be. Section 197 thus, militates against the deductor assessee unilaterally not paying or paying an amount less than the specified amount of TDS. It militates against the deductor-assessee deciding for itself the deductee assessee's liability to tax.
Sub section (1A) as amended by Finance Act, 2010 with effect from 1st July, 2010 is applicable in respect of the assessment year 2010-11. The section as amended also does not make any difference to the assessee's liability to pay interest. In the circumstances, the question of law is answered in favour of the appellant-revenue and against the respondent-assessee.
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2016 (12) TMI 1533
Reversal of credit - Rule 6(3)(b) of the CENVAT Credit Rules, 2002 - Held that: - considering the fact that while passing the impugned judgement and order the learned tribunal has relied upon the decision of the Larger Bench of the learned tribunal in the case of Nicholas Piramal (India) Limited [2008 (4) TMI 744 - CESTAT, MUMBAI], which subsequently has been reversed / set aside by the Hon’ble Bombay High Court in the recent decision COMMISSIONER OF C. EX., THANE-I Versus NICHOLAS PIRAMAL (INDIA) LTD. [2009 (8) TMI 224 - BOMBAY HIGH COURT], the impugned judgement and order passed by the learned tribunal cannot be sustained and the same deserves to be quashed and set aside and is accordingly quashed and set aside.
The benefits of amended Rule 6 of the CENVAT Credit Rules, 2002, amended by Finance Act, 2010, which is reported to be amended retrospectively w.e.f. 1/3/2002 is concerned, considering the decision of the Division Bench of this Court in the case of Shree Rama Multi Tech Ltd. [2011 (2) TMI 575 - GUJARAT HIGH COURT], it is observed that if the respondent makes an application within a period of one month from today with supporting documents for getting benefits of amended Rule 6 of the CENVAT Credit Rules, 2002, as amended by Finance Act, 2010, the same be considered in accordance with law and on merits and in light of the amended Rule 6 of the CENVAT Credit Rules, 2002, as amended by Finance Act, 2010.
Appeal disposed off - decided partly in favor of appellant.
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2016 (12) TMI 1532
Taxability - commission received - sale of branded hoses - Whether the appellant is required to discharge the Service Tax liability on the amount received as commission during the period July, 2003 to February, 2007 in respect of the goods sold by them? - section 80 - Held that: - in the case of Hindustan Petroleum Corporation Ltd. Vs. Commissioner of Central Excise, Mumbai [2014 (11) TMI 166 - CESTAT MUMBAI] as produced by the learned AR, the Bench took a call of upholding the penalties imposed at the HPCL, only on the ground that the agreement in that case specifically indicated that the HPCL will get the commission inclusive of Service Tax as applicable. In the case in hand, such clause is absent in the agreement and we are of the view that during the relevant period there could be a doubt as to whether Service Tax liability arises on the amount received as commission on the sale of items manufactured by someone else or otherwise - section 80 invoked - penalty set aside - tax and interest upheld - appeal disposed off - decided partly in favor of assessee.
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2016 (12) TMI 1531
Rejection of refund claim - service tax paid to M/s Aditi Computers who were engaged by the appellant for carrying out activities such as billing etc of the electricity distributed by the appellant to consumers - time bar - the service tax stands paid during the period August, 2004 to April, 2006 and the refund has been filed on 22.11.2007. The argument raised by the appellant is that the one year time limit will not be applicable to the present refund claim, since the service tax has been paid on a service which is not taxable.
Held that: - Refund of any amount paid as tax is necessarily to be governed by Section 11B of the Central Excise Act, 1944 which has been made applicable for purposes of refund of service tax by Section 83 of the Finance Act 1994. Consequently, refund of any amount of service tax has to satisfy the provisions of Section 11B of the Act. This section requires refund claim to be filed within a period of one year from the relevant date, which in this case is the date of payment of service tax - Since, the refund claim has not been filed within the time limit prescribed under Section 11B, the claim has been rightly rejected.
Appeal rejected - decided against appellant.
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2016 (12) TMI 1530
Valuation - reimbursable expenditure - incurring of certain expenditure on behalf of the principals like placing advertisements for procurement of materials required for executing the project, clearing & forwarding of such material from the port to the project sites etc - whether the reimbursable expenses to be included in assessable value? - Held that: - We find that reimbursed expenses in question are of a type which is not required to be rendered by consulting engineering services. The activities for which such charges are levied are not covered in the definition of consulting engineering services.
We also find that the identical issue was subject matter of Tribunal’s decision in the case of Louis Berger International Inc. Vs. CCE [2009 (3) TMI 375 - CESTAT, BANGALORE], where it was held that reimbursement of expenses incurred while rendering consulting Engg. Services are liable to be deducted from the gross value - no demand can be made on reimbursable expenses.
Entire demand beyond the normal period of limitation - barred by limitation.
Appeal allowed - decided in favor of appellant.
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2016 (12) TMI 1529
Service tax liability - Manpower Recruitment or Supply Agency service - Held that: - service rendered by the appellant in respect of the Magnaflux testing and rectification of defects, the agreement also does not indicate that what all functions that needs to be undertaken by the appellant for holding him under the category of Manpower Recruitment or Supply Agency service. Since this agreement and various other submissions as to the inclusion of tax liability etc. was not taken before the Adjudicating Authority in the absence of any reply or availing the opportunity of personal hearing, we deem it fit to leave the issue to be decided by the Adjudicating Authority on remand proceedings - appeal allowed by way of remand.
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2016 (12) TMI 1528
Denial of CENVAT credit - cement and steel - identical questions involved in the present Appeals is at large before the Hon’ble Supreme Court in the Appeal arising from the decision of the Division Bench of this Court in the case of Mundra Ports & Special Economic Zone Ltd. Vs. C.C.E & Customs [2015 (5) TMI 663 - GUJARAT HIGH COURT] - Registry to notify the Appeals for final hearing after the decision of the Hon’ble Supreme Court in Appeal against the decision of the Division Bench of this Court in the case of Mundra Ports & Special Economic Zone Ltd. (Supra) and on the note filed by the learned advocate appearing on behalf of either of the parties.
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2016 (12) TMI 1527
Rejection of refund claim - unjust enrichment - export of services - Held that: - the services rendered by the appellant for Institutional Investors situated abroad from whom brokerage is charged by them. In any case, the services were rendered by the appellant to the Institutional Investors who are situated abroad hence service tax law does not apply to them as also on the export of services. Services provided by the appellant to Foreign Institutional Investors can be termed as export of services as the service tax being a destination based tax, the recipient of the services are situated abroad.
Identical issue came up before the bench in the case of Commissioner of Service Tax, Pune II v. HSBC Software Development (I) Pvt Ltd [2016 (2) TMI 475 - CESTAT MUMBAI], where it was held that service rendered outside the country are outside the ambit of taxation.
The question of unjust enrichment does not arise in the case of export of service - appeal allowed - decided in favor of appellant.
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2016 (12) TMI 1526
Business auxiliary services - sale of goods to M/s. Amar Products on commission basis - Circular no. 59/8/2003 dated20.06.2003, 62/11/2003-ST(F.No. B3/7/2003) dated 21.08.2003 and B/2/8/2004-TRU dated 10.09.2004 - Time bar - Held that: - There is no dispute on the facts that the appellant in his individual capacity has provided services to M/s. Amar Products and was not having any commercial concern for undertaking the business in regular course. As such we find no infirmity in the views adopted by Commissioner (A) or the original adjudicating authority which is based upon boards circular and the precedent decisions.
Time bar - Held that: - during the relevant period there was a lot of confusion. All the activities undertaken by the appellant were a part of the reflection made in the balance sheet and income tax return in which case no suppression or malafide can be attributed to the assessee. No malafides could be proved by Revenue - the extended period would not be available to the Revenue.
Appeal rejected - decided against Revenue.
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2016 (12) TMI 1525
Rejection of refund claim - denial on the ground that the amount of service tax sought as refund has not been paid by the appellant but has been paid by M/s Bata India Ltd. - time bar - M/s Bata India Ltd., Chennai are one of the tenants of appellants - Held that: - The appellant has filed refund claim of ₹ 9,47,140/- on the ground that the tenant M/s Bata India Ltd., has also paid the service tax on the rent paid to appellant on which the appellant has also discharged the liability. The appellant's contention is that there is excess amount of payment of service tax to the Government and therefore apellant is eligible for refund. This contention cannot be accepted for the simple reason that the appellant who is liable to pay service tax in Guntur Commissionerate has paid the service tax and the liability is discharged. If M/s Bata India Ltd., has also paid the very same amount erroneously in Chennai Commissionerate it is for M/s Bata India Ltd., to apply for refund. So also if M/s Bata India Ltd., did not pay the service tax to the appellant, it is for the appellant to proceed against M/s Bata India Ltd., to recover the said amount. This is wholly an internal affair between the appellant and M/s Bata India Ltd. - rejection justified.
Time bar - Held that: - The date of payment of service tax by appellant is 20.04.2012. The refund claim is 14.06.2013 which was received in the office of department on 17.06.2013. Therefore the refund claim is beyond the period of one year as prescribed under section 11B of Central Excise Act read with Section 83 of the Finance Act - rejection justified.
Rejection of refund claim upheld - appeal dismissed - decided against assessee.
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2016 (12) TMI 1524
100% EOU - Rejection of refund claim - input services availed for export of services - N/N. 5/2006-CE (N.T) dated 14.03.2006 - rejection on the ground that software services were not taxable during the relevant time - Held that: - The lower authorities have taken the view that input services availed during April 2006 to March 2007 are not relatable to the services exported in September 2007. This situation has arisen from the fact that the credit of input services has not been taken during the period for which the refund has been claimed. This brings us to the question whether credit availed for a period prior to the quarter/month for which the refund has been claimed is eligible for refund or not?
This specific issue has been considered at length and decided in favor of the appellant in the case of Sai Advantium Pharma Ltd.[2015 (3) TMI 1230 - CESTAT BANGALORE], where it was held that Once credit was admissible and unless there was no nexus between the output service exported and input services were used when credit was taken, the refund of the same also could not have been denied since the substantive ground of taking CENVAT credit in the first place being correct would lead to the obvious conclusion that ultimately if it gets accumulated the refund has to be sanctioned - rejection of the refund claim filed under Notification 5/2006-CE (NT) is without justification - appeal allowed - decided in favor of appellant.
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2016 (12) TMI 1523
Refund - Cenvat credit - Rule 5 of CENVAT Credit Rules (CCR) 2004 - NNo.27/2012-CE - Held that: - The adjudicating authority has reached to a categorical finding of nexus between the input service and the manufacture of excisable goods by the appellant. Learned counsel further submitted that all the services have been held to be input service by various decisions of the Tribunal and the High Court and in support of his submission - Appeal allowed - decided in favor of the assessee.
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2016 (12) TMI 1522
Cenvat credit - Input services - Pnelaty - Rule 15(2) of CCR, 2004 - Time limitation - I find force in the contention of the Ld. Advocate for the appellant in as much as on the very same issue of the eligibility of Cenvat Credit on security services, audit had raised objection in the year 2008 (Copy of the letter enclosed at Page No 97 and 98 of Appeal Memorandum). Therefore, it cannot be said that the appellant had suppressed the facts in availing the credit on such Input Services from the knowledge of the department - Appeal partly allowed.
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2016 (12) TMI 1521
Reversal of Cenvat credit on CVD - Rule 26 of Central Excise Rules, 2002 - Interest - Penalty - the Appellants are eligible to avail credit on the inputs which were brought to the factory with intention to use in the manufacture of finished goods but soon after they came to know that the inputs could not be used and required to be destroyed, they should have reversed the credit voluntarily under intimation to the department. Having continued to retain the credit after destruction of the same till being pointed out by the department, in my opinion, cannot be construed as a bonafide act. - Levy of interest and penalty confirmed.
In the absence of any valid reason and specific evidence against the employee Shri K.D. Dholakia, penalty imposed on him is set-aside - Decided against the assessee.
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2016 (12) TMI 1520
Refund - Classification of Di-calcium Phosphate - Held that: - I find from the records viz. letter dt. 20.07.2006 that the said amount has been claimed as paid by debiting the CENVAT credut amount towards discharge of duty on disputed product Di-calcium Phosphate which was later classified as an exempted product - Whereas, in the letter dated 20.07.2006, the appellant had categorically submitted that the credit of ₹ 10,96,976/- involved in the raw materials/inputs used in the manufacture Di-calcium Phosphate has been debited by them while computing the refund amount - Appeal allowed by way of remand.
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2016 (12) TMI 1519
Imposition of penalty u/r 25 of the Central Excise Rules 2002 - The appellants have defaulted monthly payment of excise duty on due date in respect of the clearance of their final product for more than one month - demand on the ground that during the default period the duty should have been paid on consignment basis and also from PLA and not by utilizing the cenvat credit - Held that: - The only lapse on the part of the appellants was they were supposed to pay duty through PLA on consignment basis. In this fact, it cannot be said that the appellants had any intention to evade payment of duty as each and every consignment was undisputedly cleared on the invoices issued under Rule 11 of Central Excise Rules, 2002 - Since the appellants have paid the duty even from cenvat account and the department has accepted the said payment for the reason that the said payment of duty, therefore the only lapse at present is that the appellants have not paid the duty on consignment basis but on monthly basis. For this lapse in my considered view, the penalty under Rule 25(1) (a) cannot be imposed.
However there is no doubt that the appellants have contravened the provision inasmuch as they have paid duty on monthly basis as against requirement of payment of duty on consignment basis. Therefore they are liable for penalties but not under Rule 25(1) (a) but under Rule 27 of the Central Excise Rules. As per my above discussion, I reduce the penalties from ₹ 1lakh each to ₹ 5,000/- each.
Appeal disposed off - decided partly in favor of appellant.
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2016 (12) TMI 1518
Valuation - manufacture of Air Conditioners/Refrigeration equipment and supplying the same on self basis at site and undertaking the job of erection and installation of such Air Conditioners/Refrigeration - whether the freight charges to be included in the assessable value? - most appropriate method in the case is Rule 8 - Held that: - On a plain reading of Rule 8 it is clear that the value should be 115% of the cost of manufacture of the product. The provision does not provide to add any elements over and above the 115% of the cost manufacture. Therefore addition of freight charges in the value of 115% is without authority of law - freight charges is not includible in value adopted by the respondent - appeal dismissed - decided against Revenue.
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2016 (12) TMI 1517
Valuation - Cash discounts - scope of ambit - whether the cash discount realized back by the appellants through debit notes is chargeable to central excise duty? - Held that: - what has to be seen in order to arrive at the correct value of excisable goods under Section 4 is such value at the time of removal, and this being so under both the old Section and the new Section, cash discount has to be allowed as has been held in Union of India v. Bombay Tyre International Limited [1983 (11) TMI 70 - SUPREME COURT OF INDIA] - there will be no need to add back the discounts to the assessable value, even if the same are subsequently recovered - appeal allowed - decided in favor of appellant.
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