TMI Tax Updates - e-Newsletter dated: March 1, 2013 - with Direct Tax, Indirect Tax and GST Updates and Updates on FTP, FEMA, IBC & Corporate Laws etc. published on TMI with Latest Case Laws


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TMI Tax Updates - e-Newsletter March 1, 2013 Case Laws in this Newsletter: Income Tax Customs Service Tax Central Excise CST, VAT & Sales Tax Indian Laws Highlights / Catch Notes Indian Laws: Budget 2013 – Notifications and Circulars – Service Tax, Central Excise and Customs Visit to Get Source Indian Laws: SERVICE TAX - AMENDMENTS PROPOSED IN CHAPTER V OF THE FINANCE ACT, 1994 Visit to Get Source Articles Quick Review of Budget effects - Indirect Taxes – Customs and Excise Corporate Governance: Proposed Reforms – Part III (SEBI Proposals) RESTORATION OF ACCOUNTING CODES FOR REGISTRATION SERVICE TAX - AMENDMENTS PROPOSED IN CHAPTER V OF THE FINANCE ACT, 1994 - BUDGET 2013-14 Highlights of steps proposed for the Hi-tech and MSME's industry – Budget 2013-14 Notifications Central Excise 12/2013 - dated 1-3-2013 - CE Seeks to amend notification No. 12/2012 – CE, dated the 17th March, 2012, so as to make necessary amendments in the specified entries thererin. 11/2013 - dated 1-3-2013 - CE Seeks to amend notification No.30/2004-CE, dated the 9th July, 2004, so as to provide ‘zero excise duty route’ to branded ready- made garments and made-ups. 10/2013 - dated 1-3-2013 - CE Seeks to amend notification No. 2/2011 - CE, dated the 1st March, 2011, so as to omit the entry relating to handmade carpets and other carpets and floor coverings of Jute and Coir. 09/2013 - dated 1-3-2013 - CE Seeks to amend notification No. 1/2011- CE, dated the 1st March, 2011, so as to omit the entry relating to specified goods. 08/2013 - dated 1-3-2013 - CE Seeks to amend notification No. 7/2012- CE, dated the 17th March, 2012, so as to prescribe 6% rate of excise duty to branded readymade garments and made ups of cotton, not containing any other textile materials. 07/2013 - dated 1-3-2013 - CE Seeks to provide exemption to intermediate goods captively consumed in the manufacture of goods by units availing Area Based Exemption in the State of Himachal Pradesh and Uttarakhand 06/2013 - dated 1-3-2013 - CE Seeks to rescind notification No. 20/2011- CE, dated the 24th March, 2011 relating to 1% excise duty on Mobile handsets including Cellular phones. 05/2013 - dated 1-3-2013 - CE Seeks to amend notification No. 17/2007- CE, dated the 1st March, 2007 so as to increase the compound levy rate of duty for Stainless pattis/pattas from Rupees Thirty Thousand to Rupees Forty Thousand per cold rolling machine, per month. 04/2013 - dated 1-3-2013 - CE (NT) Seeks to notify “the resident public limited company” as a class of persons under the sub-clause (iii) of clause (c) of section 23A of Central Excise Act, 1944. 03/2013 - dated 1-3-2013 - CE (NT) Seeks to amend the notification No. 23/2004-CE (N.T.), dated 10th September, 2004, so as to provide a mode of recovery of CENVAT credit wrongly taken, under the CENVAT Credit Rules, 2004. 02/2013 - dated 1-3-2013 - CE (NT) Seeks to further amend the notification No. 4/2002-CE (N.T.), dated 1st March, 2002 so as to make provision for interest on refund, subject to sub-rule (6), arising out of an order of final assessment under sub-rule (3) of rule 7 of the Central Excise Rules, 2002. 01/2013 - dated 1-3-2013 - CE (NT) Seeks to amend notification No. 49/2008- CE (N.T.), dated the 24th December, 2008, so as to prescribe MRP based assessment with 35% abatement thereon, for branded medicaments used in Ayurvedic, Unani, Sidha, Homeopathic or Bio-Chemic systems and to align the tariff lines relating to Pressure Cooker with HS 2012 . Customs 15/2013 - dated 1-3-2013 - Cus Seeks to amend notification No.27/2011-Customs, dated the 1st March, 2011, so as to specify effective rates of export duty on specified goods. 14/2013 - dated 1-3-2013 - Cus Seeks to amend notification No. 146/94-Customs, dated the 13th July, 1994, so as to exempt “Trophy” when imported into India by the National Sports Federation or any other registered sports body, for being awarded to the winning team in the international tournament to be held in India. 13/2013 - dated 1-3-2013 - Cus Seeks to rescind the notifications No. 19/2012-Customs, dated the 17th March, 2012, and No. 20/2012-Customs, dated the 17th March, 2012 12/2013 - dated 1-3-2013 - Cus Seeks to amend notification No. 12/2012-Customs, dated the 17th March, 2012, so as to make necessary changes in the specified entries therein. 11/2013 - dated 1-3-2013 - Cus Seeks to amend notification No. 9/2012-Customs, dated the 9th March, 2012, so as to revise the variation limit in respect to height and circumference in case of re-import of cut and polished diamond 10/2013 - dated 1-3-2013 - Cus Seeks to amend notification No. 75/2005-Customs, dated the 22nd July, 2005 so as to make editorial changes in column (2) of S. No. 118, to align it with HS 2012 09/2013 - dated 1-3-2013 - Cus Seeks to amend notification No. 69/2004-Customs, dated the 9th July, 2004, so as to review the existing entries therein and make necessary changes. 25/2013 - dated 1-3-2013 - Cus (NT) seeks to further amend notification No. 30/98-Customs (N.T.), dated 2nd June, 1998, so as to raise the value limit of Jewellery allowed duty free to an Indian passengers who has been residing abroad for more than one year. Service Tax 04/2013 - dated 1-3-2013 - ST Seeks to notify “the resident public limited company” as a class of persons under sub-clause (iii) of clause (b) of section 96A of the Finance Act, 1994. 03/2013 - dated 1-3-2013 - ST Seeks to amend notification No. 25/2012- Service Tax, dated the 20th June, 2012, so as to make necessary amendments in the specified entries therein. 02/2013 - dated 1-3-2013 - ST Seeks to amend notification No. 26/2012- Service Tax, dated the 20th June, 2012, so as to make necessary amendments in the specified entries therein. SEZ S.O. 342(E) - dated 6-2-2013 - SEZ Proposed Under Section 3 of the Special Economic Zones Act 2005(28 to 2005), (hereinafter referred to as the said act), to set up a multi product Special Economic Zone Circulars / Instructions / Orders Service Tax - D.O.F. No. 334/3/2013-TRU - dated 28-2-2013 Union Budget 2013: Changes in Service Tax-reg. Income Tax - Memorandum-1 - dated 28-2-2013 FINANCE BILL, 2013 - PROVISIONS RELATING TO DIRECT TAXES FEMA - 321 /03.10.42 /2012-13 - dated 27-2-2013 Know Your Customer (KYC) norms /Anti-Money Laundering (AML) Standards/Combating of Financing of Terrorism (CFT)/Obligation of banks under Prevention of Money Laundering Act (PMLA), 2002 Customs - D.O.F.No.334/ 3/2013-TRU - dated 28-2-2013 Important changes in respect of Customs and Central Excise duty and legislative changes Central Excise - D.O.F.No.334/ 3/2013-TRU - dated 28-2-2013 Important changes in respect of Customs and Central Excise duty and legislative changes News FINANCE BILL, 2013 - PROVISIONS RELATING TO DIRECT TAXES Finance Bill 2013 Budget 2013-2014 - Speech of Shri P. Chidambaram Minister of Finance Index of Eight Core Industries (Base: 2004-05=100), January 2013 Agricultural Credit Target Kept at Rs. 7 Lakh Crores Budget 2013 – Notifications and Circulars – Service Tax, Central Excise and Customs Generation-Based Incentive for Wind Energy Projects Announced Rs. 27,049 Crore Outlay Proposed for the Ministry of Agriculture Government to Pull Out all Stops to Achieve the Objective of Skilling 50 Million People ; Youth to be Targeted and Motivated Rs. 10,000 Crore Proposed for Incremental Cost of National Food Security Finance Minister Proposes Special Focus on Green Revolution in 2013-14; Outlay Increased to Boost Agriculture Production Government Plans to Evolve New Criteria for Determining Backwardness Government Announces Fund for Products Based on Science and Technology Innovations Foreign Investment to be Encouraged to Tide over Current Account Deficit Fiscal Deficit for the Year 2013-14 Estimated at 4.8 Per Cent, to be Brought Down to 3 Per Cent by 2016-17 ‘Higher Growth Leading to inclusive and Sustainable Development is the Mool Mantra’ says the Finance Minister Direct Benefit Transfer Scheme to be Rolled out throughout the Country: Government Ensures “Aapka Paisa Aapke Haath” to the Poor Government Pledges to Empower Women and Keep them Safe and Secure : Nirbhaya Fund of Rs. 1,000 Crores Announced Rs 400 Crore for Institutions of Excellence ; Private FM Radio Services in 294 New Cities; Post Offices to become Part of Core Banking Solution “What we will become Depends on US” – P Chidambaram Rs. 5,87,082 Crore for States/ UTs under Tax Share, Non-Plan Grants, Loans and Central Assistance Government takes Measures to Rationalise Expenditure No Compromise on Security of Nation ; Government to Meet any Additional Requirement on that Account Government Committed to Fight Inflation, says Finance Minister Maternal and Child Malnutrition will be Tackled in A Mission Mode Budgetary Allocation for JNNURM more than Doubled at Rs 14,873 Crore Additional Deduction of Interest upto Rs.1 Lakh on Home Loan for First Home Buyer Surcharge of 10 Per Cent on Persons with Taxable Income Exceeding Rs.1 Crore Six Aiims-Like Institutions to become Fully Functional in 2013-14 Thousands of Scholarships Announced for Students belonging to SC/ST/OBC/ Minorities and Girl Children Relief for Taxpayers in the Bracket of Rs.2 Lakh to 5 Lakh Tax Credit of Rs.2000 to Every Person with Total Income upto 5 Lakh 46%Hike in Budgetary Allocation for Flagship Schemes of Rural Development Rs 1,400 Crore Allocated for Water Purification Plants in Arsenic and Fluoride Affected Rural Habitations Banks to be infused with Rs 14,000 Crore Capital to meet basel III Norms-Financial inclusion on Bank Agenda TDS at the Rate of 1 Percent Applied on the Value of Transfer of Immovable Property Exceeding Rs.50 Lakh Nearly 30% Hike in Plan Expenditure for 2013-14 Overarching Goal of Budget is to Create Job Opportunities for Youth Rajiv Gandhi Equity Savings Scheme(RGESS) Liberalised 15 Percent Investment Allowance Provided on Investment of More than 100 Crores in Plant and Machinery Concessional Rate of Tax of 15 Percent on Dividend Received from its Foreign Subsidiary by a Company Continued for One More Year New Measures for Welfare of SC/ST, Women and Minorities Generation-Based Incentive for Wind Energy Projects Announced Direct and Indirect Tax Proposals to Yield Rs. 18,000 Crore; Tax Administration Reforms Commission to be set up; Tobacco Products, SUVs and Mobile Phones to Cost More A PPP Policy Framework with Coal India to be Devised to Increase Coal Production Seven New Cities Planned on Delhi Mumbai Industrial Corridor(DMIC) A Chennai Bengaluru Industrial Corridor Being Planned Centre Incentivises Saving for Household Sector Procedures for Foreign Portfolio Investors Simplified-Several Measures Announced to Strengthen Capital Markets Final withholding Tax Levied at the Rate of 20 Per Cent Multi-Pronged Approach to help Increaseinsurance Penetration Clarity in Tax Laws, Stable Tax Regime, Non-Adversarial Tax Administration, Dispute Resolution and Independent Judiciary – The Theme of Tax Proposals Customs Duty on Imported Luxery Goods Such as high End Motor Vehicles, Motorcycles, etc. Increased However, Environment-Friendly Vehicles given benefit of Extended Period of Concession Aircraft Manufacture, Repair and Overhaul Industry also given Certain Concessions Duty free limit for Bringing Jewellery by Elligible Passengers increased Tax Administration Reforms Commission to be Set Up Work on the Direct Taxes Code (DTC) in Progress Many Concessions in Customs Duty Announced Duty on Certain Machinery for Manufacture of Leather and Leather Goods Reduced Duty on Pre-Forms of Precious and Semi-Precious Stones Drastically cut However, to Encourage Domestic Production Duty on set Top Boxes Doubled; Duty on Raw Silk Tripled Modified Provisions of General Anti-Avoidance Rules(GAAR) to Come into Effect from 1ST April, 2016 Rate of Tax on Investment Made through a Designated Bank Account in Rupee Dominated Long Term Infrastructure Bonds Reduced Benefit under Section 80-D of the Income Tax Act for CGHS Extended to Similar Schemes of the Central Government and State Governments Voluntary Compliance Encouragement Scheme’ Proposed to Motivate Defaulters to File Service tax Returns and Pay Dues Two More Services included in the Negative list for Service Tax All Air Conditioned Restaurants to Come under Service Tax Net Eligibility Conditions of Life Insurance Policies for Persons Suffering from Disabilities and Certain Ailments Relaxed Relief in Excise Duty to Redymade Garment Industry, Handmade Carpets, Ship Building Industry Specific Duty on Cigarettes, Cigars, Etc. Increased Excise Duty on Costly Mobile Phones and SUVS also to go up Need for Increasing The Tax GDP Ratio A regulatory Authority to Remove Bottlenecks in Road Sector to be Constituted Parity in Taxation between IDF – Mutual Fund and IDF-NBFC Securitisation Trust to be Exempted from Income Tax Doing Business in India to be Made Easy and Mutually Beneficial 12th Plan Projects Investment of Rs 55,00,000 Crore in Infrastructure Slew of Administrative Measures for Optimum Efficiency of the Tax Regime Rs. 9,000 Crore set Apart for the 1st Instalment of the Balance of CST Compensation to States Work on Draft GST Constitutional Amendment Bill and GST Law Expected to be taken Forward Direct and Indirect Tax Proposals to Yield Rs. 18,000 Crore; Tax Administration Reforms Commission to be set up; Tobacco Products, SUVs and Mobile Phones to Cost More A PPP Policy Framework with Coal India to be Devised to Increase Coal Production Seven New Cities Planned on Delhi Mumbai Industrial Corridor(DMIC) A Chennai Bengaluru Industrial Corridor Being Planned Seven New Cities Planned on Delhi Mumbai Industrial Corridor(DMIC) A Chennai Bengaluru Industrial Corridor Being Planned Centre Incentivises Saving for Household Sector Government to Introduce Investment Allowance of 15 per cent for High Value Investments Incentives for Semiconductor Wafer Fab Manufacturing Cabinet Committee on Investment(CCI) to Fast Track Implementation of High End Projects Work on the Direct Taxes Code (DTC) in Progress Many Concessions in Customs Duty Announced Duty on Certain Machinery for Manufacture of Leather and Leather Goods Reduced Duty on Pre-Forms of Precious and Semi-Precious Stones Drastically cut However, to Encourage Domestic Production Duty on set Top Boxes Doubled; Duty on Raw Silk Tripled Modified Provisions of General Anti-Avoidance Rules(GAAR) to Come into Effect from 1ST April, 2016 Commodities Transaction Tax (CTT) Introduced in a Limited Way; Agricultural Commodities will be Exempt No Change in the Normal Rates of Excise Duty and Service Tax Peak Rate of basic Customs Duty for Non-Agricultural Products also Untouched Securities Transaction Tax (STT) Reduced Highlights of the Budget Agricultural Credit Target Kept at Rs. 7 Lakh Crores Matching Equity Grants to Registered Farmer Producer Organisations (FPOs) Proposed Government Plans to Evolve New Criteria for Determining Backwardness Finance Minister Proposes Special Focus on Green Revolution in 2013-14; Outlay Increased to Boost Agriculture Production Rs. 10,000 Crore Proposed for Incremental Cost of National Food Security Government to Pull Out all Stops to Achieve the Objective of Skilling 50 Million People ; Youth to be Targeted and Motivated Budget Summary Pre Budget 2013 - ICAI (Indirect tax) Service Tax – Amendments through Notifications in Exemptions and Abatement Draconian provision of arrest - Power of Commissioner to arrest introduced in Service Tax LEGISLATIVE CHANGES in Central Excise and Customs CENTRAL EXCISE - Changes in Rate of Duty CUSTOMS - Changes in Rate of Duty and Baggage Rules SERVICE TAX - AMENDMENTS PROPOSED IN CHAPTER V OF THE FINANCE ACT, 1994 Case Laws: Income Tax 2013 (2) TMI 630 Deduction u/s 80IB(10) - Housing project - HC uphold the order of ITAT in which ITAT directed the A.O. to look into the agreement entered into by the assessee with land owner and decide whether the assessee has in fact purchased the land for a fixed consideration from the land owner and assessee had developed the housing project at its own cost and risk involved in the project, in respect of the issue regarding deductions u/s. 80IB(10) r.w.s. 80IB(1) as claimed by the assessee. 2013 (2) TMI 629 Revenue or capital expenditure - amount spent for acquisition of membership of the clubs - held that:- the concurrent finding arrived at by the appellate authority and the Income-tax Appellate Tribunal that the expenditure incurred for acquisition of membership of the club is revenue expenditure, is justified and cannot at all said to be perverse or arbitrary so as to call for interference in this appeal. - Decision of Apex Court in Empire Jute Co. Ltd.'s case [1980 (5) TMI 1 - SUPREME COURT] and decision of HC in CIT v. Wipro Systems [2009 (11) TMI 402 - KARNATAKA HIGH COURT] followed. - Decided in favor of assessee. Expenditure on ISO-9001 certificate - held that:- the certificate would only certify that the procedure followed by the assessee in the manufacture and the quality maintained during manufacture is in accordance with the standard prescribed. - held as revenue in nature - Decision in CIT v. Perot Systems TSI (India) Ltd. [2010 (9) TMI 108 - DELHI HIGH COURT] followed - Decided in favor of assessee. 2013 (2) TMI 628 Reassessment - reopening after 4 years - notice u/s 148 - held that:- If the Legislature amends the provisions of the Act with retrospective effect, it cannot be said that there was failure on the part of the assessee to disclose fully and truly all material facts relevant for the purpose of assessment. - Decided in favor of assessee. 2013 (2) TMI 627 Deduction u/s 37(1) - welfare expenses towards providing education to its employees' children & Payments to other educational institutions where the children of its employees were studying - held that:- matter remanded back in view of earlier decision in Sandur Manganese & Iron Ores Ltd. Versus Commissioner of Income-tax [2012 (9) TMI 765 - SUPREME COURT]. There is a difference between reim-bursement and contribution. If the Tribunal comes to the conclusion that the amount has been reimbursed, the quantified amount shall be certified by the chartered accountant of the assessee to enable the assessee to make a claim. 2013 (2) TMI 626 Interest on monies borrowed for setting up sugar plant – assessee set up Ferro Alloys Plant in 1991 & sugar plant in 1995 - HC has [2008 (11) TMI 43 - HIGH COURT DELHI] uphold the decision of Tribunal that there is a unity of control and management, in respect of both plants and there is also intermingling of funds and dove-tailing of businesses - hence it cannot be said that the assessee had not commenced its business and hence, interest would have to be capitalized - financial charges i.e., interest is allowable as deduction u/s 36(1)(iii) - Appeal against the Decision of HC dismissed by the apex court in view of the concurrent findings recorded by the courts below. - In favor of assessee. 2013 (2) TMI 625 Addition u/s 68 - cash credit - capacity and credit worthiness - held that:- in view of authoritative pronouncement of the Apex Court in ommissioner of Income Tax v. Lovely Exports (P) Ltd., [2008 (1) TMI 575 - SUPREME COURT OF INDIA], as also by the Division Bench in Jaya Securities Ltd. v. Commissioner of Income Tax, [2007 (5) TMI 552 - HIGH COURT OF ALLAHABAD] decided in favor of assessee. 2013 (2) TMI 623 Deduction u/s 80-IB(11) - cold chain facilities - Integrated business of cold storage and cold transportation - held that:- it is not necessary that there should be facility of transportation along with the facility of cold storage to constitute a cold chain facility. The business of cold storage alone, without any transportation facility with refrigeration back to back upto consumption and, linking farmer and market also qualifies for deduction in terms of provisions of Section 80-1B (11) of the Act. The word "or" in the context here means and should be interpreted as disjunctive particle. The statute should be read in its ordinary, natural, and grammatical sense. - Decided in favor of assessee. 2013 (2) TMI 622 Deduction u/s 80-IB(11) - cold chain facility - AO denied the benefit by stating that merely providing refrigerated storage facilities for potatoes cannot be regarded as an undertaking having 'cold chain facilities' within the meaning of Section 80-IB of the Act - held that:- Bare perusal of the aforesaid definition it is clear that "cold chain facility" means a chain of facilities for storage of agricultural produce under scientifically controlled conditions including refrigeration and other facilities necessary for the preservation of such produce. The words storage and transportation have been separated by using word 'or' as such both the facilities of storage and transportation at the same time was not necessary for falling within the definition of "cold chain facility" Business of the assessee is covered within the definition of "cold chain facility" under Section 80-IB (14) (aa) of the Act and the assessee was entitled for exemption under Section 80-IB of the Act. 2013 (2) TMI 621 Income escaping assessment - notice u/s 147/148 - non mentioning of AY in the notice - assessee participated in the reassessment proceeding. - appeal was allowed in part by the CIT(A) against the order u/s 147 - validity of assessment u/s 292B and 292BB - held that:- No party can claim to have vested right in injustice being done because of some slip of pen, or omission causing no prejudice to anyone. The section is intended to ensure that an inconsequential technicality does not defeat justice. Nature of mistake will determine whether a return, order or proceeding is vitiated or not. The only defect which could be pointed out is that the assessment year was not mentioned in the reasons recorded by the Assessing Officer. Unless it is shown that assessee was misled by not mentioning the assessment year in the reasons recorded, we are of the view that if the reasons recorded relate to a particular year, the reassessment proceeding initiated relate to that particular year and the assessee participated in the reassessment proceeding without raising any objection, such an objection cannot be raised by the assessee at a subsequent stage of the proceeding. Order of the Tribunal cannot be sustained - Decided in favor of Revenue. Customs 2013 (2) TMI 638 Import of used tyres - hazardous waste - confiscation - held that:- as per the United Nations Environmental Programme vis-à-vis Basel Convention regarding Pneumatic tyres, the lifetime of an original tyre casing must not exceed seven years. All the imported used tyres in these cases are 6+ years old and as per the reports available on record, these tyres cannot be made use of until and unless they are re-treaded and even after re-treading, they cannot be made use of for quite a long time. Therefore, naturally, these old tyres will shortly be a hazardous waste in our country. Writ appeals filed by the Customs are allowed. The respondents/importers are directed to send back the imports to the countries of origin at their own cost and expenditure immediately. The appellants are directed to take all steps necessary in this regard. Appellants to consider the requests of the respondents/importers for refund of any such fee or other charges they have paid for claiming the goods, as per rules, if any such request is made on behalf of the respondents/importers within two weeks of receipt of a copy of this order. Service Tax 2013 (2) TMI 635 Whether the advances giving raise to tax demand has really suffered tax in subsequent period and disclosed in service tax returns filed - Held that:- From various documents enclosed to paper book it exhibits that the appellant has made effort to satisfy the authority below making reconciliation of the advance received with adjustment thereof towards taxable service received in future. But that does not pin point in which year and under which head that was adjusted filing returns under Finance Act, 1994. What that is required is that both sides should make effort to reconcile with reference to receipt and disclosure in the returns of relevant year to reach to a rational conclusion in respect of the amounts of the show cause notice. If any of the part of the advance attributable to taxable service and that did not form part of returns filed subsequently that amount shall be brought to tax without escapement. Law does not permit postponement of liability because of specific provision under section 67(3) of the Finance Act - remand the matter for proper reconciliation to serve interest of justice 2013 (2) TMI 634 Job Work - Notification No. 8/2005-S.T., dated 1-3-2005 - It is pointed out that the benefit was denied on the ground that the ducts and other items fabricated by the appellant were not excisable goods covered by the first schedule to the Central Excise Tariff Act. - held that:- demand of service tax and education cess is not under any determinate head of taxable service. No breakup of the gross value for different categories mentioned in the impugned order is forthcoming. Apparently, the appropriate taxable service was not identified either in the show-cause notice or in the impugned order. A demand of service tax without correct classification of the taxable service is alien to the scheme of service tax levy. This apart, the learned Commissioner appears to have denied the benefit of the aforesaid notification on a ground which is not sustainable in law, given the parameters of the said notification. Activities otherwise includible within the ambit of ‘Business Auxiliary Service’ were excluded from the levy from 2004 onwards where such activities involved manufacture of excisable goods. For claiming the benefit of the notification, the assessee should be held to have provided the taxable service. - Stay granted. 2013 (2) TMI 633 Rectification of Mistake - Error apparent on face of record - Issue involved wrongly considered - held that:- the Cenvat credit of services availed during construction would be available and the decision is applicable squarely to the facts in this case - Accordingly, the paragraphs 8 & 9 of the order dt. 17-1-2012 [2012 (11) TMI 574 - CESTAT, AHMEDABAD] substituted - ROM application accepted. 2013 (2) TMI 632 Whether the CESTAT was justified in upholding the service tax demand confirmed by the adjudicating authority with interest and penalty solely on the basis of the statement of the employee of the assessee without considering the specific plea of the assessee that service tax is not leviable based on certain documents produced before the CESTAT. Held that:- It is well established in law that it is open to the assessee to demonstrate on the basis of the documentary evidence that the statement recorded is erroneous. - if on remand the CESTAT comes to the conclusion that the service tax is not leviable for the disputed period and consequently interest and penalty is not leviable, then and in that event the assessee shall not claim refund of service tax already collected and paid to the Revenue. - matter remanded back to tribunal. Central Excise 2013 (2) TMI 620 Refund claim on service tax paid denied - service tax paid under Section 66A(1) of the Finance Act, 1994 was not listed under Rule 3(1) of the CENVAT Credit Rules and hence, no CENVAT Credit could be allowed on the said amount of service tax paid and accordingly, no refund was admissible - Held that:- Payment of service tax under Section 66A(1) had been subsequently inserted as clause (ixa) in Rule 3(1) of the CENVAT Credit Rules, 2004 by amending the said Rule and giving retrospective effect to the said amendment from 18.04.2006. Hence, the refund of CENVAT Credit on the said input service is admissible under Rule 5 of the CENVAT Credit Rules. Thus the claim for refund under CENVAT Credit Rules is admissible to the Appellant. For the refund amounts of Rs.430/- and Rs.2691/-, it is necessary that the xerox copies of the documents produced have to be examined by the adjudicating authority afresh, to ascertain its admissibility. Accordingly, the case is remanded to the adjudicating authority for the limited purpose of verification of documents on the eligibility of refund claims of Rs.430/- and Rs.2691/-. 2013 (2) TMI 619 Cenvat credit on the input packing materials that had gone into the manufacture of exempted products - Non maintenance of separate inventory/records - appellants manufactured both dutiable as well as exempted product - demand for recovery of Modvat credit wrongly availed and equivalent amount of penalty - Held that:- Modvat credit against all these Invoices were not availed by the appellants during the material period 1998-1999 to 2001 - 2002. The 23 Nos. of Invoices involving the credit of Rs.88,000.33, were considered by the Commissioner (Appeals), but the benefit was not extended fully on the ground that the benefits were already extended to them in the impugned show-cause notices. But as find that in the show-cause notice, the demand was calculated on pro rata basis and not on actual basis. Accordingly, in view of the scrutiny/examination of Department, it can safely be concluded that the appellants did not avail modvat credit against 26 Nos. of Invoices involving credit of Rs.88,000.33 and also 17 Nos. of Invoices involving credit of Rs.99,825/-. The entire amount of cenvat credit not availed by them during the said period, works out at Rs.1,87,825/-, which clearly covers the amount of cenvat credit alleged to have been wrongly availed on the common inputs/packing materials used in or in relation to the manufacture of dutiable as well as exempted products. In these circumstances the appellants had not availed cenvat credit of Rs.1,48,630/- on the input packing materials that had gone into the manufacture of exempted products - in favour of assessee. 2013 (2) TMI 618 Cenvat credit on royalty charges - Held that:- The appellants were engaged in the manufacture of Sharon brand plywood along with their own brand, that is, in the manufacture of plywood, they had affixed the brand name of Sharon and cleared it from their factory. Therefore, it can be inferred that the service tax paid on the royalty, (IPR Services) were used in or in relation to the manufacture of their Sharon branded plywood . Thus, it is squarely covered under the definition of input services laid down under Rule 2 (l) (ii) of Cenvat Credit Rules, 2004 - in favour of assessee. 2013 (2) TMI 617 Utilization of credit of additional excise duty of Textiles & Textile Articles towards payment of basic excise duty denied - assessee contested that credit was utilized after due permission of Assistant Commissioner, therefore the demand is not sustainable - Held that:- There is no provision under the Cenvat Credit Rules for utilization of credit of additional excise duty towards payment of basic excise duty and the only provision in the rules for the refund or rebate under Rule 5 of rules is admissible for accumulated credit of additional excise duty in respect of inputs used in the manufacture of exported goods. Prima facie it is not a case for total waiver of duty, thus the applicants directed to deposit ₹ 9,00,000/- within eight weeks. Compliance on 1.3.2013. 2013 (2) TMI 616 Refund claim of Service Tax paid for services received and utilised for export of goods - rejection of claim as filled before an inappropriate authority - Held that:- Jurisdictional Deputy Commissioner of Central Excise, Division-V (City), Ahmedabad-II rejecting the claim rather should have forwarded this application filed for the refund by the appellant to the jurisdictional Assistant/Deputy Commissioner of Service Tax, Ahmedabad City,an exclusive Service Tax Commissionerate. Remit the matter back to adjudicating authority, with a direction to him to forward the same to jurisdictional Assistant/Deputy Commissioner of Service Tax for processing the same in accordance with the law & to treat this as a refund claim filed within limitation and decide the issue at the earliest. CST, VAT & Sales Tax 2013 (2) TMI 637 Penalty u/s 67 of the KVAT Act - Held that:- Notice dated 3.10.2012 was served on the petitioner on 6.10.2012 with seven days' time to file objections and also affording an opportunity of hearing but petitioner did not respond to the notice in any manner and therefore, penalty order dated 28.11.2012 was passed. It is thereafter that the petitioner filed Ext.P1 objection. Thus, while on the one hand petitioner says that the order is a pre-dated one, according to the learned Government Pleader, order was passed on 28.11.2012 on account of the petitioner's failure to respond to show cause notice. No violation of principles of natural justice justifying interference with penalty orders. 2013 (2) TMI 636 Detention of a consignment of scientific equipments - KVAT Act - case of the petitioner that they are not a dealer but are only engaged in diagnostic services and in a similar situation that another consignment was detained, this Court ordered the goods release - Held that:- The respondent is directed to release the vehicle and goods on satisfying the requirement besides executing a 'personal bond' for the requisite amount as shown in Ext.P2. Petitioner will be free to file a statement of objection in response to Ext.P2 and it will be without prejudice to the right and liberties of the departmental authorities to pursue the adjudication proceedings, which however shall be finalised as expeditiously as possible, at any rate, within two months from the date of receipt of a copy of this judgment. Indian Laws 2013 (2) TMI 631 Intellectual Property - registration of trade mark “MAJA” label in the name of one “Shantikumar Ratilal” trading as “Shashi Industries” - held that:- the Board has rightly observed that the Registrar dealt with the application which was not before this Court and the directions of this Court have not been complied with. The Board has also rightly observed that the Registrar has gone beyond the directions of this Court. The directions issued to decide the application on Form TM-16 for amending the name of the petitioner, as a mistake had crept in due to lapse on the part of the counsel, but the Registrar failed to deal with the said application and instead proceeded to decide another application and passed orders allowing the said application. The petitioner has miserably failed to substantiate its claim that application was erroneously or inadvertently filed in wrong name. The original file of the application is already lost and cannot be reconstructed as admittedly even the petitioner does not have true copies of papers and his counsel has destroyed his file. The petitioner has failed to justify as to why the application for amendment was moved after orders were reserved in 1995 while the petitioner filed affidavit of evidence in correct name in January, 1994 itself.
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