TMI Tax Updates - e-Newsletter
October 22, 2016
Case Laws in this Newsletter:
Income Tax
Customs
Service Tax
Central Excise
CST, VAT & Sales Tax
Indian Laws
TMI SMS
Highlights / Catch Notes
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Income Tax:
TDS u/s 194C - The role of the lorry owners was very limited to the extent of carriage of goods without any other liability. Therefore, they cannot be considered as subs-contractors of the assessee. - AT
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Income Tax:
The assessee has not undertaken charitable activity during the year, therefore, it is not eligible for exemption u/s. 11 - AT
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Income Tax:
Eligibility of deduction u/s.80P(2)(a)(i) - when there were no takers for the money, which assessee as a part of its objects wanted to lend, the only available choice for assessee, in order not to keep the funds idle, was to place it in banks for earning interest - deduction allowed - AT
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Income Tax:
Disallowance of kist payment (lease rent) - prior period item - Kist payment for the previous period - It is not the case of the department that this method of accounting of kist payment on cash basis is not consistently followed by the assessee - claim of expenditure allowed - AT
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Income Tax:
Penalty u/s 271(1)(c) - conscious concealment of facts by the assessee - non disclosure of bank accounts in which cash was deposited - assessee deliberately concealed his income/furnished inaccurate particulars of such income - AT
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Income Tax:
Levy of penalty u/s 271(1)(c) - merely treating the business loss as speculation loss by the AO does not automatically warrant inference of concealment of income or furnishing of inaccurate particulars of income - AT
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Customs:
Valuation - rejection of declared value of import of goods - Only for the reason that the insurance policy of some of the consignments of being higher amount the value cannot be enhanced. - AT
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Service Tax:
Activity of toll collection on commission basis would not fall under the category of business auxiliary services, so as to make the same liable to service tax - service not liable to tax. - AT
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Service Tax:
Service provided by the appellant to the respondent M/s NTPC Ltd. clearly falls under the category of Commercial or Industrial Construction Service - service Tax leviable. - AT
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Central Excise:
Manufacture - intermediate product - job work - sugar syrup prepared within the factory in further manufacturing of biscuits for their principal - marketability of the product now in question cannot be established derivatively without ascertaining the actual nature of the impugned product and also its marketability in reality. - AT
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Central Excise:
Intention to remove the goods without the payment of duty - non-accountal of goods in the RG-1 register - search in the premises - malafide intention upheld - AT
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Central Excise:
Transaction value or MRP based valuation - the appellants had cleared 6 gms. sachet of the Hair Dye in a monopack carton containing six numbers of such sachet - appellant are to be assessed u/s 4 of the Central Excise Act without the same assessable u/s 4A - AT
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Central Excise:
Classification reusable Baby Cotton Nappies (diapers) - The Item description given for Chapter Heading 61.11 clearly covers the subject items viz., baby diaper and baby nappy. Chapter Heading 61.11 covers babies garments and clothing accessories and when these are made up of cotton, they would fall under Chapter Heading 6111.20 only. - AT
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Central Excise:
Rejection of refund claim - reversal of CENVAT credit under protest - There is no murmur or protest or disagreement with the view taken by the inspecting officers as can be inferred from this letter - Period of limitation cannot be ignored - AT
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VAT:
Exemption on polished granite stone - if a polished granite which is a slab and used on the floor, it cannot be called a tile for the purpose of coming within the ambit and sweep of Entry 8. Some other process has to be undertaken. If tiles are manufactured or produced after undertaking some other activities, the position would be different - SC
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VAT:
Taxability of a Car Stereo System - "electronic goods" falling under Entry 75 or "motor vehicle falling under Entry 18 - It cannot be gainsaid that a car stereo does add to the comfort for the use of a motor vehicle - car stereo held as accessory - to be taxed accordingly - HC
Articles
Circulars / Instructions / Orders
News
Case Laws:
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Income Tax
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2016 (10) TMI 717
Disallowance of payment of commission on account of payment to sister concern - Held that:- The nature of the services rendered by the MFPL has not been justified by the ld. AR. The AO never raised the issue that it was made to the sister concern therefore it is disallowed. The AR has not brought the specific services rendered by the MFPL. In the similar facts & circumstances the issue has been decided in favour of Revenue by the Hon’ble High Court of Gujrat in the case of Gujarat Insecticides Ltd. v. Deputy Commissioner of Income-tax [2012 (10) TMI 1072 - GUJARAT HIGH COURT] wherein Tibunal noted that the onus was on the assessee, claiming such deduction, to establish that such payments were made for services rendered. TDS u/s 194C - disallowance of carriage inward expenses on account of non deduction of TDS - Held that:- There is amendment of proviso to Sec. 40(a)(ia) of the Act r.w.s 1st proviso to Sec. 201, wherein, if any payee has paid the taxes by offering / disclosing the said receipt in its return of income, then the payer (the assessee herein) should not be treated as assessee in default. Accordingly no disallowance u/s. 40(a)(ia) of the Act could operate in that scenario. The said proviso though inserted by the Finance Act 2012 w.e.f 1-4-2013 has been held to be retrospective in operation by recent decision of the Hon'ble Delhi High Court in the case of CIT v. Ansal Land Mark Township (P) Ltd. [2015 (9) TMI 79 - DELHI HIGH COURT]. Thus we deem it fit and appropriate in the interest of natural justice and fair play to set aside this issue to the file of AO to decide the issue afresh in the light of the aforesaid judgment. Accordingly, we direct the AO to verify whether the payees have included the subject-mentioned receipts in their respective returns and paid taxes thereon or not. If that is so, then disallowance u/s. 40(a)(ia) of the Act shall not be made in the hands of assessee. Accordingly, assessee’s ground is allowed for statistical purposes.
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2016 (10) TMI 716
Rectification of mistake - Tribunal not adjudicated the submission of the assessee that at the time of grant of registration u/s 12AA of the Income-tax Act, 1961, the Director of Income-tax (Exemption) should not consider applicability of the provisions of section 13(1)(b) of the Act - Held that:- The assessee-society had neither raised ground to the effect that registration u/s 12AA cannot be denied, considering the provisions of section 13(1)(b) of the Act, nor the assessee-society has filed any evidence that pleading was made to this effect. The provisions of section 254(2) cannot be exercised to re-argue the matter afresh on different grounds or reasoning. The present Miscellaneous Petition is premised on the material which is not part of the record of the case. Therefore, we are of the considered opinion that the present Miscellaneous Petition is not maintainable as the assessee had failed to make out any mistake which is apparent from record which is capable of being rectified under the provisions of section 254(2) of the Act.
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2016 (10) TMI 715
TDS u/s 194C - disallowance of transportation charges paid by the assessee without deduction of TDS - Held that:- We find that the lorry owners are not connected with the party who is giving transportation work to the assessee. The assessee hired the lorries from outside as he was not able to manage the work with his own lorry. Therefore the assessee hired the lorries from outside on sub-contract basis and there was no contract between the principal and the lorry owners. The Revenue could not establish that these sub-contractors / lorry owners were fastened with any of the liabilities for the said carried of the goods In view of above, we find that as no part of the contract of the assessee was transferred to the lorry owners / sub-contractors. The role of the lorry owners was very limited to the extent of carriage of goods without any other liability. Therefore, they cannot be considered as subs-contractors of the assessee. Considering the facts and circumstances and cited case law, we reverse the orders of authorities below. - Decided in favour of assessee.
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2016 (10) TMI 714
Eligibility for exemption u/s. 11 - charitable activity - Held that:- In the instant case, the AO has examined the nature of activities in the light of statement of accounts, balance sheet and the activities undertaken by the assessee. The CIT(Appeals) has also examined the activities of the assessee and has noted that the main activity of the assessee is letting out of kalyana mantapa on hire charges and by doing so, assessee has earned some of ₹ 37,45,915. Besides, assessee has also collected generator hire charges and interest on FDRs, etc. Similarly, from the expenditure side, it is also noted that assessee has not incurred any major expenditure on account of education and medical relief to the poor. During the impugned assessment year, income over expenditure was of ₹ 30,72,028.44. From a careful perusal of the Income & Expenditure account for AY 2009-10, it is noticed that the main activities of the assessee was only letting out of kalyana mantapa and whatever income over expenditure was earned during the year, it was put in FDRs to earn interest thereon. No charitable activity as defined under the Act was undertaken by the assessee. In the light of these facts, it is of the considered view that the assessee has not undertaken charitable activity during the year, therefore, it is not eligible for exemption u/s. 11 of the Act. Accordingly find no infirmity in the order of the CIT(Appeals) and confirm his order.
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2016 (10) TMI 713
Eligibility of deduction u/s.80P(2)(a)(i) - object of society - idle money placed in bank with interst earned thereon - Held that:- There is no dispute that one of the main object of assessee society was providing credit facility to its members. AO himself has mentioned that this was the primary object for which assessee was incorporated. No doubt, out of substantial sum received as deposits from the members, only small portion were given by assessee as loans to its members. Major part of the funds were parked in FDs. However, it is an admitted position that assessee was bound to give interest to its members on the deposits received by it from them. Therefore, when there were no takers for the money, which assessee as a part of its objects wanted to lend, the only available choice for assessee, in order not to keep the funds idle, was to place it in banks for earning interest. As decided in CIT v. Tumkur Merchants Souharda Credit Cooperative Ltd [2015 (2) TMI 995 - KARNATAKA HIGH COURT] the money meant for lending, remaining surplus, there being no takers, if deposited in banks for earning interest, such interest income would be attributable to the business of banking carried out by the assessee. Thus as the facts of the case here fit perfectly well with the facts in the judgment mentioned above, therefore, hold that assessee was eligible for claiming deduction u/s.80P(2)(a)(i) of the Act. - Decided in favour of assessee
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2016 (10) TMI 712
Disallowance on low Net Profit percentage over turnover - AO has made the addition on the ground that the assessee has declared less profit in comparison to the AY 2010-11 - CIT granted the relief to the assessee as the AO failed to bring any defect in the booksHeld that:- In the instant case the AO has made addition on his surmise. It is well settled proposition of the law that for making any addition to the total income of assessee there has to be cogent evidence. In the absence of the same the addition shall not stand. The submission of ld. AR is that the profit ratio is the same as quoted by the AO i.e. 3.50% if we eliminate the interest and depreciation expenses from the profit. The same fact was communicated in the statement to the AO. There was no iota of defect in the books of the assessee. The case law cited by the DR is not relevant to the facts of the present case as besides the statement the AO has to bring sufficient evidence before making the addition. There is no material to justify the addition made by the IT authorities to the gross profit shown by the assessee in his account books. The additions were made on ad hoc basis and not on the evidence such as the trading conditions in similar trade or on the reconstruction of the account books of the assessee on the basis selected by the ITO which was different from the one adopted by the assessee. In view of above we do not find any reason to interfere in the order of the ld. CIT(A). Accordingly, we uphold the same. This ground of Revenue is dismissed. Addition u/s 40A(2) on expenses paid to the related parties - Held that:- AO has made the addition on his surmise and without bringing any defect in the expenditure incurred by the assessee. we also find that the similar expenses were claimed by the assessee in the earlier years and subsequent years and no disallowance was made. The ld. DR has also failed to bring anything contrary to the findings of ld. CIT(A). In view of above we do not find any reason to interfere in the order of the ld. CIT(A). Accordingly, uphold the same. This ground of Revenue’s appeal is dismissed.
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2016 (10) TMI 711
Reopening of assessment - exemption claimed by the assessee u/s 11 denied - corpus donations and advance given to Gopisetty Mallaiah & Co. - revision u/s 263 - Held that:- In the present case on hand, on perusal of the facts available on record, we find that the A.O. has conducted detailed enquiry and also examined the issues pointed out by the CIT in his show cause notice. The assessee explained each and every issue pointed out by the CIT with necessary evidences. The CIT cannot assume jurisdiction to revise the assessment order, once assessee explained that it had filed all the details before the A.O. on the issues on which CIT wants further verification. It is the general presumption of law that once the A.O. has considered all the details before completion of assessment and the CIT cannot presume that the enquiries conducted by the A.O. is insufficient and also the A.O. has not applied his mind, unless the CIT proves that the assessment order passed by the A.O. is erroneous. The assessment order passed by the A.O. u/s 143(3) r.w.s. 147 of the Act, is not erroneous in so far as it is prejudicial to the interest of the revenue in so far as three issues pointed out by the CIT in his order with regard to corpus donations, applicability of maximum marginal rate and advance given to Gopisetty Mallaiah & Co. In so far as determination of income from house property, the CIT has rightly revised the assessment order, as the A.O. has failed to examine the issue to bring the correct amount of income to the tax. Therefore, we modified the CIT’s order u/s 263 of the Act and upheld the findings of the CIT, with regard to income from house property and set aside order of the CIT in respect of corpus donations, applicability of maximum marginal rate and advance given to Gopisetty Mallaiah & Co.
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2016 (10) TMI 710
Disallowance of kist payment (lease rent) - section 43B applicability on kist payment - system of accounting followed - prior period item - Kist payment for the previous period - Held that:- As more than 93% of the expenditure pertains to the kist payment interest on kist and license fees which has been accounted on payment basis. Therefore undisputedly in the business of the assessee almost entire expenditure is incurred in respect of purchase of goods by making advance payment or simultaneous payment as the payment was being made to the Government. It is apparent that since beginning the assessee has been giving the treatment of kist payment on cash basis and the Assessing Officer accepted the same because of the reason that the department has taken a stand that the provisions of section 43B are applicable on the kist payment to the Government. Only after the judgment of Hon'ble jurisdictional High Court in Commissioner Of Income-Tax Versus Sri Balaji And Co. [2000 (1) TMI 17 - KARNATAKA High Court] and final settlement of the issue of applicability of section 43B, the Assessing Officer first time disallowed the expenditure in question. Therefore the assessee as well as revenue were under bona fide belief that the provisions of section 43B of the Act are applicable in respect of the kist payment uptil. The practice of accounting for a particular item of expenditure on cash basis was accepted for such a long time then it becomes revenue neutral as it was not claimed on due basis in the earlier assessment year. In view of the undisputed fact that in substance the system of accounting followed by the assessee is cash basis and further consistent treatment of expenditure of kist payment has been given and accepted over several years on payment basis then disallowance for this year is not justified. It is not the case of the department that this method of accounting of kist payment on cash basis is not consistently followed by the assessee. Therefore following this system of accounting consistently should not be disturbed in a particular year and particularly for the year under consideration when this claim was not made on accrual basis in the earlier year due to consistently followed accounting treatment otherwise it would result double taxation of the same income. In view of the above facts and circumstances of the case, we allow the claim of the assessee.
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2016 (10) TMI 709
Disallowance on account of expenditure u/s. 14A - Held that:- Own funds of the assessee are sufficiently in excess of both the borrowings and investments, borrowings are proved to be for a specific purpose and there is no possibility of investing them for generating the exempted income, investments that are generating the exempted income were made prior to the relevant previous years, and above all the legal requirement of the AO recording the reasons for resorting to Section 14A r/w 8D in this matter are conspicuously absent. Viewing from any angle, we are convinced that there is no justification for the authorities below to sustain the disallowance made u/s. 14A of the Act in AYs 2008-09 and 2009-10. - Decided in favour of assessee MAT Applicability u/s 115JB - Held that:- There is no dispute that the assessee is a Public Limited company engaged in the business of generation/distribution of power and energy and is governed by the provisions of Electricity Act, 2003. Under West Bengal Electricity Regulatory Commission (Terms and Conditions of Traffic) Regulations, 2007 issued pursuant to Electricity Act, 2003, Assessee is under an obligation to prepare its accounts as per the said regulations and not under Part II and III of Schedule VI of the Companies for computing Book Profit. As a matter of fact, a coordinate Bench of this Tribunal in the assessee’s own case for the AY 2007-08 [2016 (8) TMI 855 - ITAT KOLKATA] considered this issue in extenso and hold that the provisions of Section 115JB have no application to the assessee company. In the said case, this Tribunal, after going through the basic intention behind the introduction of Sec. 115JB of the Act, Department Circular No. 762 dated 18.02.1998, Memorandum explaining the provisions in the Finance Bill, 1996, under the caption “Rationalisation and Simplification”, hyden rules, decisions of various High Courts and Tribunal viz. Kerala State Electricity Board Vs. DCIT reported in (2010 (11) TMI 127 - Kerala High Court) and Maharashtra State Electricity Board Vs. JCIT reported in (2001 (8) TMI 310 - ITAT MUMBAI ) decided that the provisions of section 115JB of the Act are not applicable to the assessee company. - Decided in favour of assessee
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2016 (10) TMI 708
Disallowance of contributions of the employees towards ESI & PF - Held that:- As it is stated by the learned Counsel for the assessee that the payment was made before the date of filing of the return of income by the assessee. Further, we find that this issue is also covered by the judgment of the Hon'ble Supreme Court in the case of Alom Extrusion, reported in (2009 (11) TMI 27 - SUPREME COURT ) wherein it has been held that both the employees as well as employers contribution are allowable as deduction u/s 36(1)(va) provided assessee makes the payment before due date of filing of return. - Decided in favour of assessee.
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2016 (10) TMI 707
Penalty u/s 271(1)(c) - conscious concealment of facts by the assessee - non disclosure of bank accounts in which cash was deposited - Held that:- The assessee was well aware that he was having three bank accounts and deposited cash therein, did not disclosed the amounts and also the accounts to the Department, therefore, it was a conscious and deliberate act on the part of the assessee to hide something, consequently, the penalty was rightly imposed. It is also noted that the addition made by the Assessing Officer on this count was accepted by the assessee and no appeal was filed on quantum addition knowing-fully well that there is conscious concealment of facts by the assessee. For imposing penalty u/s 271(1)(c) of the Act, either there should be concealment of income or furnishing of inaccurate particulars of such income. The material facts, available on record clearly indicates that the assessee deliberately concealed his income/furnished inaccurate particulars of such income, therefore, in my view, the penalty was rightly imposed by the Assessing Officer and confirmed by the Ld. Commissioner of Income Tax (Appeal). - Decided against assessee.
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2016 (10) TMI 706
Levy of penalty u/s 271(1)(c) - inaccurate particulars of income claiming the loss as business loss as the loss is in the nature of speculative loss in terms of Explanation to Section 73 - Held that:- AO did not agree with the claim of the assessee that the loss claimed by the assessee as trading loss is actually speculation loss in view of application of Explanation to Section 73 of the Act and this loss of ₹ 50,12,977/- is allowed to be carried forward for set off of speculation profits in any subsequent year. We find that all the facts and figures are available on record and the disallowance of loss is due to wrong interpretation of Explanation to Section 73 of the Act by virtue of which the same is treated as speculation loss. We are of the view that merely treating the business loss as speculation loss by the AO does not automatically warrant inference of concealment of income or furnishing of inaccurate particulars of income, particularly when the assessee has furnished full details of purchase and sales of shares. Even otherwise, we are of the view that the AO himself is not sure of the charge for levy of penalty whether the same is for concealment of income or for furnishing of inaccurate particulars of income. In view of the above, we set aside the orders of the authorities below and delete the penalty imposed on the assessee. - Decided in favour of assessee.
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2016 (10) TMI 705
Rejection of books of accounts - Held that:- The assessee has furnished the Daily Stock Account of Copper Scrap and also the Job Work done by M/s. Kwality Tubes & Capillaries along with reference of challan, quantity, production loss etc. the assessee has also filed copy of RG 23A Register demonstrating that all the transactions were duly recorded. The assessee has also given ledger account of conversion charges of sister concerns and also copy of Form No. 16A. In respect of difference in conversion charges as per TDS Certificates and what was debited, it is stated that the difference of ₹ 19,30,603/- is due to the Credit of CENVAT included in the goods sent for job work and goods received from job work through the credit notes received from M/s. New India Extrusions Pvt. Ltd. on which though TDS is deducted but not debited to Conversion Charges A/c but to CENVAT Credit A/c. The difference of ₹ 2,77,796/- is due to the Credit Note of Discount received from M/s. SAM Enterprises on 31.03.2009 but on which TDS was already deducted earlier. Thus there is no error and difference of ₹ 22,08,399/- (1930603+277796) is reconciled. It is stated that these credit notes were produced before the AO but were not understood by the AO. It is stated that these objections of the AO that the difference could not be explained is contrary to the facts. It is further stated that books of accounts were duly submitted before the AO as the AO himself has noted in the assessment order that books of accounts, bills and vouchers etc. were examined on test check basis. We find that the AO has noted that in spite of repeated opportunity, the assessee has not submitted the books of account after the date 9.9.2011 on which the assessee was required to justify the defect as mentioned above to cross verify the contention of the assessee. We find force in the contention of the ld. Counsel for the assessee that assessee had submitted plausible explanation to the defects as pointed out by the AO. We also noticed that in the paper book the assessee has given certificate that except document at sl. No. 10, all other documents were part of the record of the lower authorities. Therefore, it can be inferred that these materials were available before the AO. The AO has not given any finding on this evidences, therefore, in our considered view, the AO was not justified in rejecting the books of account without properly examining the same and giving a specific finding on the material so placed before him. The books of account cannot be rejected in a casual manner and proceed to estimation of GP merely on the basis of past history of the assessee. If the assessee is able to demonstrate that the facts and circumstances were different from the earlier years resulting into fall in GP ratio, the GP rate adopted by the AO on the basis of past history would not be a better guide. After considering the totality of the facts and circumstances of the case, we are of the considered view that the AO was not justified in rejecting the books of account.
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Customs
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2016 (10) TMI 726
Exemption under N/N. 151/2009-Cus dated 31.12.2009 - import of Injection Moulds - certificate of origin - whether the appellants importer, who had imported certain goods from Korea and was entitled to benefit of exemption of Customs duty under Notification No.151/2009-Cus dated 31.12.2009, in respect of goods imported under Korea-India Comprehensive Economic Partnership Agreement and whether the appellant can claim the said benefit, subsequent to import and after assessment of the Bill of Entry, by filing appeal before the Ld. Commissioner(Appeals)? - Rule 15 of the Customs Tariff Rules, 2009 - Held that: - the Ld. Commissioner (Appeals) have erred in rejecting the appeal and it is a clear case of failure of his part to exercise jurisdiction. In the interest of justice, I allow these appeals by way of remand to the adjudicating authority with the direction to verify the claim of the appellant and to allow the same after verifying the authenticity of the certificate of Origin. The appellant is also directed to appear before the adjudicating authority with their representation and supporting within a period of 45 days from the date of receipt of the copy of this order and seek an opportunity of hearing - matter remanded - appeal allowed.
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2016 (10) TMI 725
Valuation - rejection of declared value - transaction value in terms of Section 14 of the Customs Act read with Rule 4 of the Customs Valuation rules (Determination of Price of Imported Goods) Rule 1988 - Polyester Metallic Yarn / Polyester Metallised Film - demand of differential duty u/s 28 of the (1) of the CA, 1962 - Pure Silver Metallic Polyester Yarn - Held that: - the investigation was initiated on the basis of intelligence that the Appellant firm had been importing Pure Silver Metallic Yarn/ Film at an undervalued price and the visit was made to the premises of jobworker M/s Divyesh Bros. The authorities did not conduct any test of goods as it turned out that the test report No. TC/LM/SE4464/2006-07 dt. 15.09.2006 issued by the Textiles Committee, Ministry of Textiles, Govt. of India, Textile Laboratory and Research Center, Mumbai on the drawn by the Customs, Shava from the B/ E No. 892058 dt. 05.09.2006 revealed that there is no silver or gold content in the films imported by the Appellant firms. The revenue thus accepted that the imported goods were Polyester Silver metallised polyester film/ yarn with no content of silver or gold. Only for the reason that the insurance policy of some of the consignments of being higher amount the value cannot be enhanced. The decision in the case of ANAND MAHINDRA Versus COMMR. OF CUS. (IMPORT), MUMBAI [2008 (2) TMI 104 - CESTAT MUMBAI] relied upon. In order to hold the imports as contemporaneous and to invoke Rule 6 of Customs Valuation Rules, it is necessary to show that the goods are identical goods' or similar goods'. Such goods have to be same in all specifications such as physical characteristics, quality, country of origin, quantity - the allegation of undervaluation against the Appellant firms does not establish. Demand of duty, penalty and fine not sustainable - appeal allowed - decided in favor of appellant.
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2016 (10) TMI 724
Import of white garlic - whether white garlic is dried garlic or fresh garlic? - Imposition of redemption fine and penalty - Held that: - the appellant had never declared the consignment of garlic before the lower authorities as ‘dried garlic’, instead has declared the consignment as ‘pure white garlic’. In our view pure white garlic cannot be considered as ‘dried garlic’ despite there being no samples drawn and tested. The decision in the case of Raisoni Exports (India) Pvt. Ltd. vs. Commissioner of Customs, Nhava Sheva [2011 (2) TMI 259 - CESTAT, MUMBAI] does not apply to the present case as the appellant therein had declared the goods imported from Pakistan as dried garlic but on test it was found that the goods were not dried garlic but fresh garlic. In the case in hand, we find that the consignment is declared as ‘pure white garlic’. Quantum of redemption fine and penalty found to be in excessive - ends of justice would be met if the redemption fine is reduced to ₹ 1 lakh as also the penalty from ₹ 30,000/- to ₹ 20,000/- - appeal disposed off - decided partly in favor of appellant.
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2016 (10) TMI 723
Confiscation of consignment - option to pay redemption fine of ₹ 5,20,000/- - imposition of penalty of ₹ 2,60,000/- - import of 25MTs of Turkish White Poppy Seeds after expiry of registration certificate - certificate of registration issued by the Central Bureau of Narcotics (CBN), Gwalior - whether the goods imported after the validity period of registration certificate liable to be confiscated? - reliance placed on the decision of the case of Guru Ispat Ltd. Vs. Commissioner of Customs (Port), Calcutta [2002 (7) TMI 642 - CEGAT, KOLKATA] - Held that: - the decision of the case Guru Ispat Ltd. does not apply as the issue decided is entirely different. In the case, the goods were shipped wrongly by the foreign supplier whereas as per the fact of the present case, the mistake is on the part of the appellant that despite knowing the validity of the registration they allowed foreign supplier to ship the goods. The mistake has occurred, there is no mala fide behind such mistake or to gain undue benefit from such mistake. The justice can be met if redemption fine and penalties are reduced - Redemption fine reduced from ₹ 5,20,000/- to ₹ 2 lakhs and penalties from ₹ 2,60,000/- to ₹ 1 lakh - appeal disposed off - decided partly in favor of appellant.
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2016 (10) TMI 722
Jurisdiction of Commissioner (Appeals) - Section 128 A(3) of Customs Act, 1962 - limited power of Commissioner (Appeals) only to confirm, modify and annual the Order-in-Original - the Commissioner(Appeals) has directed the Original Adjudicating authority to verify the documents, thus she has not finally decided the appeal but remitted to the original authority - whether the remand order passed by Commissioner (Appeals) is within his jurisdiction? - the refund was sanctioned and was credited to the Consumer Welfare fund therefore the limited issue before the Commissioner(Appeals) was to decide the aspect of unjust enrichment - Held that: - The Commissioner(Appeals) has no power to remand the matter whereas she could decide the appeal finally on the basis of documents placed before her. The issue of unjust enrichment can be decided by the Commissioner(Appeals) on the basis of documents produced before the Commissioner(Appeals) - impugned order set aside - matter remanded to the Commissioner(Appeals) for deciding the appeal finally only on the issue of unjust enrichment - Appeal disposed off.
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Service Tax
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2016 (10) TMI 746
Levy of service tax - management, maintenance or repair of immovable property - Section 97 of the Finance Act, 2012 vide which the management, maintenance and repair of roads, during the period on and from the 16/6/05 to 26/7/2009 were retrospectively amended with the provisions for grant of refund, if any, service tax stand paid on the same - Held that: - Section 97 of the Finance Act, 2004 grants exemption to the management, maintenance and repair of roads, with retrospective effect till 26th July, 2009. The period involved in the present appeal is 16/5/2005 to June, 2007, which periods stand covered by the above amendment. In view of the same, we find no merits for confirmation of demand of service tax on the said ground to the extent of ₹ 67,64,987/-. Accordingly, the same is set aside alongwith setting aside of penalty on the same count. Business Auxiliary Service - contracts by NHAI - collection of tolls and deposit the same with the authorities, while retaining a small percentage as their commission - Held that: - reliance placed in the decision of COMMR. OF SERVICE TAX, DELHI Versus INTERTOLL ICS CE CONS O & MP. LTD. [2013 (12) TMI 731 - CESTAT NEW DELHI] where it was held that such activity of toll collection on commission basis would not fall under the category of business auxiliary services, so as to make the same liable to service tax - service not liable to tax. As the demand stand set aside on merits, the plea of limitation raised by the appellant is not being adverted to. Appeal allowed - decided in favor of appellant.
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2016 (10) TMI 745
Levy of service tax - scope of commercial and industrial construction which came into effect from 10.9.2004 - scope of construction of complex services which came into effect from 16.6.2005 - construction work for government and PSUs. - Held that: - the work listed out at S. No. a and b is for the construction of staff quarters and Hostel for the staff of Ministry of Defence as well as Government of Chhattisgarh. It is to be noted that Government has given the permission to respondent to carry out the construction work but nature of use of the building on completion is clearly for the personal use of Government for allotment to its staff. In view of the Explanation in section 65 of the Finance Act, 1994, no service tax can be levied on such construction of complex service. In respect of the work at Sl. No. 3, there can be no doubt that this construction has been undertaken by the respondent for the Government Dental college cum Hospital at Raipur for the Government of Chhattisgarh. - In view of CBEC circular dated 17-9-2004, the service outside the ambit of service tax. All the three constructions outside the ambit of service tax - appeal dismissed - decided against Revenue.
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2016 (10) TMI 744
Power of Commissioner to direct lower authority to file an appeal before Commissioner (Appeals) on 14.08.2009 - refund of service tax - service utilized for export of the goods in terms of notification No. 41/2007-ST dated 6.10.2007 - Section 84 of the Finance Act, 1994 replaced subsequently on 19.08.2009 - whether it was within the jurisdiction of the Commissioner to direct the lower authority to file an appeal prior to 19.08.2009 on which date section 84 was replaced? - w.e.f. 19.08.2009 the provisions of section 84 were changed and the Commissioner was empowered to examine the order of the adjudicating authority and if he was not satisfied, to direct the said authority to file an appeal before the Commissioner (Appeals). Held that: - The impugned order of the Assistant Commissioner, in the present proceedings, was passed on 26.05.2009 and the order in review by the Commissioner directing the Assistant Commissioner to file an appeal was passed on 14.8.2009 i.e. before 19.08.2009. As such, it can be safely held that, during the relevant period, there were no powers or jurisdiction with the Commissioner to direct the Assistant Commissioner to challenge the order passed by him before the Commissioner (Appeals). As such, the appeal filed by the Assistant Commissioner before the Commissioner (Appeals) in terms of the order-in-review dated 14.08.2009 is without jurisdiction and against the clear law laid down in the Act. Consequently, the order-in-original passed by the Commissioner (Appeals) is bad in law, being beyond jurisdiction. At this stage, that the Commissioner has passed the review order dated 14.08.2009 in exercise of the provisions of sub-section (2) of Section 35-E of the Central Excise Act, 1944. The dispute in the present appeal relates to the refund of the service tax, excess paid by the assessee, and as such the provisions of the Finance Act, 1994 would apply - the issue stands considered in the case of BHANDARI FOILS PVT. LTD. Versus COMMISSIONER OF CENTRAL EXCISE, BHOPAL [2002 (4) TMI 122 - CEGAT, COURT NO. IV, NEW DELHI]. Appeal allowed - decided in favor of appellant.
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2016 (10) TMI 743
Construction services provided to NTPC - Commercial or Industrial Construction Service - whether services provided to NTPC is for social or philanthropic purposes and the demand of service tax is not justified? - the decision in the case of P.B. Rathod Vs. CCE, Nashik [2015 (10) TMI 1854 - CESTAT MUMBAI] referred - Held that: - the decision in the case is not applicable as service were provided to a Government of Gujarat Water Supply and Sewerage Board and Construction of Sports Complex Stadium, allowed to be used by public. Therefore the services were provided not for commercial or industrial uses. M/s NTPC Ltd. is a Public Ltd. Company and indeed engaged in the industrial and commercial activities i.e. generation of power and selling thereof. Therefore the laying of pipeline even for providing to water supply to staff quarter is not for social or philanthropic purposes. The staff quarter and welfare of the employee is part of the statutory obligation of M/s NTPC Ltd. for ultimate object of running the commercial and industrial organisation. Therefore the service provided by the appellant is for use in the activity of commercial or industrial activity - service provided by the appellant to the respondent M/s NTPC Ltd. clearly falls under the category of Commercial or Industrial Construction Service - service Tax leviable. Period of limitation - Held that: - the appellant never informed the department about their activity, even did not bother to take any opinion either from department or from any legal professional. Since, the department was not aware about activity of the appellant, therefore the extended period was rightly invoked. Imposition of penalty - Held that: - the appellant recorded the transaction in the books of account, therefore there is no malafide intention on their part which shows reasonable cause for non-payment of Service Tax. There is a reasonable cause shown by the appellant for non-payment of Service Tax in respect of service provided to M/s NTPC Ltd - Section 80invoked - penalty imposed u/s 76, 77 & 78 of the FA, 1994 waived. Appeal disposed off - partly decided in favor of appellant.
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2016 (10) TMI 742
Appeal against the assessee who has died / no more - transportation charges - loading and unloading charges - thappi charges - Held that: - the respondent was proprietorship firm under the Proprietor of Shri Arjun Chothani and now he is no more. Respondent being an individual dead person, the Revenue cannot file appeal against a dead person by making him respondent. Rule 22 of Customs Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982 referred and held that if respondent dies, the appeal shall abate - merits of the case set aside - appeal disposed off - decided against Revenue.
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Central Excise
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2016 (10) TMI 741
SSI exemption - clubbing of clearances - whether settlement commission was justified in holding that M/s.Hides, which is one of the two units, does not have any machinery, manpower and money to function as an independent entity for the purpose of availing the benefit of SSI exemption and the clearances of M/s.Hides should be clubbed along with the petitioner/applicant? - Held that: - the Settlement Commission has not rendered any finding, accepting the stand of the petitioner that activity done by it, does not amount to manufacture. In fact, it was on an assumption that assuming the activity is not manufacture, what would be the duty liability. Therefore, the direction issued to the Revenue by the Settlement Commission at best could be considered, as an information, the Commission wanted to know with regard to the impact of duty assuming that the activity done by the petitioner, did not amount to manufacture. The decision in the case of Singhvi Reconditioners Pvt., Ltd., vs. UOI [2010 (2) TMI 6 - SUPREME COURT] followed where it was held that the assessee having opted to get their customs duty liability settled by the Settlement Commission cannot be permitted to dissect the Settlement Commission's order with a view to accept what is favourable to them and reject what is not. This is what the petitioner precisely wants to do, accept the immunities granted to the petitioner, exercise the option of redemption and also willing to settle the penalty. Order of settlement commission do not need interference - petition dismissed - decided against petitioner.
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2016 (10) TMI 740
Denial of SSI exemption - N/N. 8/2002-CE dated 01/3/2002 - imposition of penalties - confiscation of goods with an option to pay redemption fine - use of brand name belonging to other person - Held that: - we are dealing with the set of companies/firms which are owned or managed or related to a family. The numerous undertaking created, converted or close later, are all having business interconnection in one way or other. Even without going into the legal and statutory implication of formation of these units their day-to-day functioning etc., it can be fairly seen that in such scenario of family connected or managed units the statutory condition for availing exemption under Notification No. 8/2002-CE requires close scrutiny and evidences clearly based on record. Keeping this in view, we find that the lower authorities have perused all the available evidences and arrived at the conclusion. In the absence of strong contrary evidence, we have no reason to interfere with the same. We also note no serious legal infirmity in this findings - appeals rejected - decided against appellant.
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2016 (10) TMI 739
Manufacture - intermediate product - job work - marketability - sugar syrup prepared within the factory in further manufacturing of biscuits for their principal - manufacture of biscuits on job work basis - whether Revenue was justified in holding that w.e.f. 1.3.2007, biscuits were exempted by the Notification No.3/2006-CE dated 1.3.2006, since final products (biscuits) are exempted, the intermediate product, sugar syrup arising in the appellant's unit is liable to central excise duty as the exemption under Notification No.67/1995-CE dated 16.3.95 will not be available to them? - Held that: - decision in the case of Rishi Bakers Pvt. Ltd. vs. C.C.E. & S.T., Kanpur [2015 (4) TMI 893 - CESTAT NEW DELHI] relied upon where it was held that Neither there is any evidence to prove that the goods, in question, are classifiable under 17029090 nor there is any evidence to prove that the goods, in question, in form in which they come into existence in the appellant s factories, are marketable. The impugned order is not sustainable. The same is set aside and case decided in favor of assesees. In the present case, no efforts have been made by the Department to test the product for the correct composition and nature. Instead, the percentage of sugar in syrup was arrived at by the calculation of quantity used. Further, the whole allegation of marketability is based on one invoice of another manufacturer for the product sugar invert syrup . We find that the marketability of the product now in question cannot be established derivatively without ascertaining the actual nature of the impugned product and also its marketability in reality. Intermediate product not taxable - appeal allowed - decided in favor of appellant.
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2016 (10) TMI 738
Evasion of Central Excise Duty - search of premises - removal of goods without payment of duty - confiscation of goods with an option to pay redemption fine - imposition of penalty - legality of Redemption Fine and penalty imposed - Held that: - Once the amount payable under Cenvat Credit Rules is held as duty of excise, the inputs and capital goods removed without payment of amount on duty from the factory of the first appellant shall be treated to have been removed without payment of duty, making the same liable to confiscation under Rule 25(1) of the Central Excise Rules, 2002. The decision in the case of Roll Well Conveyor vs. Jt. Commissioner of Central Excise, Thirupathi [2009 (6) TMI 110 - KARNATAKA HIGH COURT] relied upon where similar issue was decided and it was held that confiscation of the goods and imposition of penalty by the adjudicating authority which was upheld by the Tribunal, was legal and correct and do not call for any interference. Confiscation of the goods and imposition of redemption fine in lieu of confiscation and imposition of penalty upheld - quantum of redemption fine and penalty reduced - appeal disposed off - decided partly in favor of appellant.
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2016 (10) TMI 737
Intention to remove the goods without the payment of duty - non-accountal of goods in the RG-1 register - search in the premises - confiscation of goods with an option to redeem the goods on payment of redemption fine - imposition of penalty u/r 25 of the Central Excise Rules, 2002 - Held that: - confiscation of the excess found goods has been upheld on the ground that same were neither entered in form IV register or lot register or RG I register. Though the appellants have argued that goods were yet to be entered in RG I register as the same were still to be inspected by the DGS&D department, but I find that even in their memo of appeal, there is no ground relatable to non-entry of goods in form IV register or lot register. As such, it cannot be said to be a mere case of non-entry in RG I register. Admittedly, on receipt of raw materials i.e, grey fabrics, the same are required to be entered in the raw materials register as also the lot register. Non entry of the same in the statutory documents would admittedly lead to appellants malafide that same were meant for clandestine clearance - malafide intention upheld - confiscation upheld - appeal rejected - decided against appellant.
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2016 (10) TMI 736
Clandestine manufacture and removal of excisable goods - Sponge Iron - demand of duty with imposition of penalties - recovery of certain private records and statement of employees of the main appellant - denial of cross examination - Held that: - the appellants should have been offered an opportunity to cross examine the persons, who gave statements, which were relied upon by the Department. This is more relevant in the present case as the Director of the Company countered various assertions made by the employee in his statement and the correctness of production register maintained privately by one of the employees. As noted above, since the whole case rests on these private records and statements, it is necessary to get the truth of the matter after following the procedure laid down by the law. The chart submitted by the Revenue in para 10 of their appeal, shows that the private records and the RG-I and other statutory records were taken selectively to allege excess clandestine production. We note that wherever the figures are to their advantage to support the allegation of Revenue those figures were selectively taken in respect of some of the selective days to arrive at a calculation. Certain parameters have been taken as per RG-I and Form-IV, which are statutory records. The percentage yield is taken from the private records. We find that there is no consistent approach in calculating the quantification of unaccounted production, if any, by the main appellant. Further, all the purported evidences and claims made by the main appellant have not been discussed and commented upon by the Original Authority. The impugned order suffers from various inconsistencies with reference to appraisal of facts and also due to violation of principles of natural justice - matter remanded back to the Original Authority for fresh decision - appeal allowed.
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2016 (10) TMI 735
Transaction value or MRP based valuation - Taxability of Hair Dye with the brand name "Indica" cleared in retail packs containing 6 gms. each and six numbers of such pack placed in mono-carton for convenience of sale - Section 4 of the Central Excise Act, 1944 or Section 4A of the said Act? - Rule 34 of the 1977 Rules at the material time very specifically states that the goods weighing less than 20 grams or less than 20 milli litres when sold by weight or measure, are out of the purview of 1977 Rules. - Held that: - the appellants had cleared 6 gms. sachet of the Hair Dye in a monopack carton containing six numbers of such sachet. The weight of goods in individual sachet satisfies the condition of Rule 34 of 1977 Rules. Therefore, goods of appellant are covered by Rule 34 of the 1977 Rules and enjoy exemption from application of the 1977 Rules. Revenue says that legal Metrological Department has opined that the goods in question being 5.6 gms. each that ipso facto cannot be considered to be a multi-piece package. We are not guided by this opinion of the Metrology authority in view of factual finding of the adjudicating authority as to the weight of the sachet and clearance of six numbers of sachets packed in mono-pack carton attracting Rule 34 of the 1977 Rules, being a pack of 6 gms. in each sachet. That gets exemption from the application of the 1977 Rules. Accordingly, the goods cleared by appellant are to be assessed under Section 4 of the Central Excise Act without the same assessable under Section 4A thereof on the facts and circumstances of the case - penalty also waived - appeal allowed - decided in favor of appellant.
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2016 (10) TMI 734
Clearance of various assemblies, components etc. (CETH 9305.00) without payment of duty - Held that: - While there is no dispute on the legal principle upheld by the impugned order, the duty liability of appellant has to be found on the basis of already discharged duty, exclusion of bought out items and imported SRGM. If needed the Original Authority can re-verify the correct payment of duty by the appellant with the records - appeal disposed off.
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2016 (10) TMI 733
Classification of goods - reusable Baby Cotton Nappies (diapers) - classified under Chapter Subheading 6101.00 of Central Excise Tariff as undergarments or under Chapter Subheading 4818.10 as napkins, towels etc? - Held that: - The Explanatory Notes to this Chapter Heading 61.11 says that in accordance with Note 6(a) to this Chapter the expression babies garments and clothing accessories applies to articles for young children of a body height not exceeding 86 cm. It also covers babies napkins. It is clear that both these classifications are not appropriate for the subject item namely reusable baby nappies/diapers made of cotton. The appellant is insisting classification under Chapter Subheading 4818.10 where toilet paper is covered. The subject item is not toiler paper; it is reusable baby diaper/nappy only. The items in Chapter Heading 48.18 are made of paper pulp, paper, cellulose wadding, etc., only. However the subject item is predominately made of knitted cloth of cotton and relevant classification for this item would, therefore, be Chapter Heading 61.11. The Item description given for Chapter Heading 61.11 clearly covers the subject items viz., baby diaper and baby nappy. Chapter Heading 61.11 covers babies garments and clothing accessories and when these are made up of cotton, they would fall under Chapter Heading 6111.20 only. Consequently the subject item deserves classification under Chapter Heading 61.11 only. The lower Revenue authorities decided classification in Chapter Heading 61.01 but right classification for the subject item is Chapter Heading 6111.20. The duty payable, if any, therefore would be computed by classifying the goods under Chapter Heading 6111.20 of Central Excise Tariff. Period of limitation - Held that: - duty of Central Excise, if any, cannot be levied for the period beyond one year from the date of show-cause notice. The matter deserves to be remanded to the original adjudicating authority for computation of duty, if any, for the period of one year prior to the date of show cause notice; it shall be decided by the original adjudicating authority within a period of three months from the receipt of this order by giving opportunity of personal hearing and that of production of necessary documents, if any - matter remanded - appeal disposed off.
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2016 (10) TMI 732
Demand of interest - imposition of penalties - simultaneous availment of CENVAT credit on capital goods and depreciation of the duty portion of the value of capital goods under Section 32 of the Income Tax Act, 1961 during the financial year 2007-08 - the original authority has not ordered the recovery of amount under the show cause notice in question as the same has already been adjusted in the books of depreciation by the applicants. It is also seen that the appellant had filed the revised return with the Income Tax authorities for the F.Y. 2007-08 and not claimed depreciation in the revised return. Revised return was filed within time limit set by the Income Tax Law - Held that: - The issue is squarely covered by the judgment of the Hon’ble Gujarat High Court in the case of CCE Surat-II Vs. Nish Fibres [2009 (12) TMI 415 - Gujarat HIGH COURT] where the claim regarding depreciation withdrawn by filing revised return and such revised return accepted. Credit not deniable. Since the assessee have adjusted the amount of Cenvat Credit in their depreciation account, I do not intend to demand the amount of ₹ 1,70,820,/- once again . Once the demand proposed in show cause notice has been dropped, there is no question of interest or imposition of penalty under 11 AC equivalent to the demanded amount. Appeal allowed - decided in favor of appellant.
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2016 (10) TMI 731
Recovery of refund sanctioned - SCN - precedent - classification of goods - Held that: - It is strange that the appellant instead of honouring the liability for classification of the goods under Chapter Heading 8448.00, is arguing that this classification would be valid only for prospective period. Earlier the matter was before CESTAT for deciding the classification of the goods, though appellant contended that the classification of the goods would fall under Chapter Subheading 4009.99 which carried nil rate of duty, whereas Revenue was contending under Chapter subheading 4016.99 which carried 16% duty. The Tribunal vide its Final Order dated 19.3.1998 decided the issue by ordering the classification under Chapter Subheading 8448.00. Once the Tribunal issues its Order on 19.3.1998, it has to be given full execution both on the part of the Revenue as well as on the part of the appellant unless it is appealed against. The appellant s contention is that the Tribunal s Order will have only prospective operation is misplaced. Earlier for classification of the subject goods, the appeal was filed by the appellant; the Tribunal before admitting the appeal vide its Stay Order No.375/1996 dated 25.10.1996 asked the appellant to make a pre-deposit ₹ 8 lakhs. This pre-deposit cannot be refunded when there is further liability of ₹ 3,32,025/- after the classification is finalized by the Tribunal under Chapter subheading 8448.00. The decision in the case of Precision Rubber Industries Pvt. Ltd. vs. CCE, Mumbai-IV: 2005 [2005 (1) TMI 167 - CESTAT, MUMBAI] relied upon. Appeal dismissed - decided against appellant.
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2016 (10) TMI 730
Rejection of refund claim - reversal of CENVAT credit under protest - period of limitation bar u/s 11B of the Central Excise Act, 1944 - Held that: - There is no murmur or protest or disagreement with the view taken by the inspecting officers as can be inferred from this letter. It further emerges that the appellant has taken a stand before the Department that the reversal of Cenvat credit was under protest only at the time of filing the refund claims for the first time on 22/12/2000 as well as 15/1/2001. I see from the records that these refund claims were incomplete and have been resubmitted after rectifying the same on a subsequent date. It is seen from the record that the appellant has already been sanctioned the refund for reversals done considering these two dates as the relevant dates - rejection of refund claim justified - appeal disposed off - decided against appellant.
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2016 (10) TMI 729
Benefit of Notification No.108/95 C.E. - No justification to introduce any condition or read the Notification No. 108/95 C.E. in a restrictive manner – no reason to interfere with the impugned judgment and order - Appeal against the decision in the case of Commissioner of Central Excise Versus M/s. Caterpillar India Pvt. Ltd. [2013 (7) TMI 244 - MADRAS HIGH COURT] dismissed.
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2016 (10) TMI 728
Stay order - Held that: - In view of the judgment and order passed by this Court in Commissioner of Customs & Central Excise, Ahmedabad v. Kumar Cotton Mills Pvt. Ltd. [2005 (1) TMI 114 - SUPREME COURT OF INDIA], we find no reason to interfere with the impugned order passed by the High Court - appeal against the decision in the case of PML Industries Ltd. Versus CCE. [2013 (4) TMI 101 - PUNJAB AND HARYANA HIGH COURT] dismissed
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2016 (10) TMI 727
Due to low tax effect, appeal not entertained - question of law left open - against the decision in the caseof BECTORS FOODS SPECIALITIES PVT. LTD. Versus COMMR. OF C. EX., JALANDHAR [2008 (8) TMI 146 - CESTAT NEW DELHI] dismissed
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CST, VAT & Sales Tax
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2016 (10) TMI 721
Imposition of penalty - Cyclic Hydrocarbons (Marker) - stock transfers - transported from NOIDA to Lucknow - Form-31 in terms of Section 28A of the U.P. Trade Tax Act, 1948 Act - violation of Section 15-A(1)(o) of the 1948 Act - Held that: - the goods were seized during the course of their transit, as per the assessee, from Noida to Lucknow. The assessee had before the authorities admittedly submitted the GR and Stock Transfer Invoices which had accompanied the goods. It is also not disputed by the department that the OC stamp was present along with the documentation which accompanied the goods in question. The allegedly failure on the part of the assessee to deposit the Stock Transfer Invoices dated 16 November 2006 within twenty four hours or at least till 21 November 2006 would neither be determinative nor conclusive insofar as the issue of an intent to evade the payment of tax is concerned. The mere statement of the driver that the goods had in fact been loaded at Delhi and were bound for Lucknow did not in the opinion of this Court conclusively lead one to the conclusion that the transportation was being effected in an attempt to evade assessment or payment of tax. The mere absence of a Form-31 not being fatal to the case of the assessee - penalty not justified. Order of assessment - Held that: - the assessment was based entirely upon the levy of penalty upon the assessee on two occasions. The levy of penalty which formed the subject matter of Second Appeal No. 507/2011 stood anulled by the Tribunal itself. The levy of penalty has been found by this Court to be unsustainable. Since the estimation admittedly was not based on any other material the addition to the declared turnover of the assessee and levy of additional tax also must therefore necessarily fail. Revision allowed - decided in favor of assessee.
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2016 (10) TMI 720
Taxability of a Car Stereo System - "electronic goods" falling under Entry 75 or "motor vehicle falling under Entry 18 - Whether a Car Stereo System was liable to be taxed under Entry 75 of a Notification dated 13 December 2002 or whether it was liable to be classified and taxed on the basis of it falling under Entry 18 of the Notification dated 29 January 2001 as amended and reiterated vide Notification dated 9 May 2003? - whether a car stereo is liable to be viewed as an accessory to a motor vehicle? - Held that: - A car stereo is undoubtedly available as an article in an automobile market or shop or a place of manufacture. The Tribunal noted that in many cases a car stereo is either pre-fitted in a motor vehicle and in other instances fitted subsequently. A car stereo, in the opinion of this Court, would therefore be liable to be treated as an accessory. It cannot be gainsaid that a car stereo does add to the comfort for the use of a motor vehicle. It enables a driver undertaking a long journey to enjoy the ride and makes the trip pleasurable. Viewed in this sense, it must be held to be an article which adds to the comfort for the use of the motor vehicle. In view of the above, whether the Court applies the comfort test or whether it applies the test of whether an article can be said to be available for sale in an automobile market, on both scores, the car stereo held as an accessory. The entry of "accessories" was placed specifically in the company of and under the heading of motor vehicles. The other competing entry upon which reliance was placed was of microwave ovens and all other electronic goods "not specified anywhere else". Even if a car stereo be viewed as "electronic goods", they would stand comprised in Entry 18 by virtue of being an accessory to a motor vehicle. They were in this sense,though electronic goods, but since specified elsewhere they would stand excluded and extracted from Entry 75 - car stereo held as accessory - revision application dismissed - decided in favor of Revenue.
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2016 (10) TMI 719
Demand of duty - Exemption on polished granite stone on the basis that polished granite stones were produced from out of the tax suffered from rough granite blocks - Revisions under Section 12-A(1) - If a polished granite stone is used in a building for any purpose, it will come under Entry 17(i) of Part S of the second schedule, but if it is a tile, which comes into existence by different process, a new and distinct commodity emerges and it has a different commercial identity in the market - Held that: - if a polished granite which is a slab and used on the floor, it cannot be called a tile for the purpose of coming within the ambit and sweep of Entry 8. Some other process has to be undertaken. If tiles are manufactured or produced after undertaking some other activities, the position would be different - Decided in favor of revenue.
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Indian Laws
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2016 (10) TMI 718
Disciplinary proceedings - imposition of punishment as per Annexure A9 order, whereby two increments were barred for a period of two years with cumulative effect - alternative remedy of revision - statement u/s 164 of the Cr.P.C - Held that: - A statement under Section 164 of the Code of Criminal Procedure is not substantive evidence. It can be used to corroborate the statement of a witness. It can be used to contradict a witness. It is settled law that in the case of a 'disciplinary proceeding', the guilt need not be established beyond any reasonable doubt, unlike a criminal proceeding and that preponderance of probability is sufficient in the former case. There is no allergy even to 'hear-say evidence', if it is having some nexus. The verdict passed by the Tribunal is perfectly within the four walls of the law and is not liable to be assailed in any circumstance. No tenable ground brought to the notice. Interference declined and the Original Petition fails and dismissed accordingly.
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