This weekly round-up analytically summarizes the key stories of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) reported at taxscan.in, from September 1, 2024 to September 7, 2024.
The Customs , Excise & Service Tax Appellate Tribunal ( CESTAT ) Ahmedabd Bench observed that as the Renting of Earth Moving Equipment to various clients is not a taxable services as it does not falls under supply of tangible goods and secondly, the service prior to 01.07.2012 and subsequent thereto it does not fall under the definition of input service.
The ITAT Bench comprising Ramesh Nair, Judicial Member and C.L Mahar, Technical Member observed that the appellant has given earth moving equipment on monthly rent basis to their lessee and the right to possession and use of earth moving equipment has been transferred to the lessee. So according to the above order it is clear that transaction of renting of Earth Moving Equipment to various clients firstly, does not fall under supply of tangible goods and secondly, the service prior to 01.07.2012 and subsequent thereto it does not fall under the definition of input service as mentioned above. Therefore, the activity of renting of Earth Moving Equipment to various clients is not a taxable service. Hence the impugned order is not sustainable, the same is set-aside and the appeal is allowed.
The Ahmedabad Bench of the Customs, Excises and Service Tax Appellate Tribunal ( CESTAT ) recently held that Activities rendered by Stem Cell/Umbilical Cord Blood Banks are not retrospectively exempt from Service Tax while upholding a Rs.2 Cr Service Tax Demand imposed by the Revenue Department on the Appellant.
In light of the findings, the West Zonal Bench of CESTAT, Ahmedabad Coram comprising Somesh Arora, Judicial Member and C.L. Mahar, Technical Member referred to the Decision of the Madras High Court in Life Cell Internation (P) Ltd. vs. Union of India (2015) and maintained that the Amendment to the Mega Exemption Notification cannot be attributed retrospective application to permit the Appellant to avail Service Tax Exemption. In conclusion, the Tribunal while dismissing the Appeal, adjudged that the Appellant Company is very much liable to pay Service Tax on the aforementioned period. The Tribunal further condemned the Appellant’s wilful default in payment of Service Tax, subjecting them to a violation of the limitation for non-filing of their returns.
In a significant relief to Hindustan Inox Limited and its directors, the Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) has quashed the penalties imposed under Section 112(a) of the Customs Act, 1962. The penalties were initially imposed on the directors of the company by the Commissioner of Customs.
The CESTAT Bench of S.K. Mohanty, Member (Judicial) and M.M. Parthiban, Member (Technical) thus set aside the penalties imposed on the directors under Sections 112(a) and 114AA of the Customs Act, citing that the procedural misinterpretations and subsequent investigation did not involve any intentional violation of customs law. The Tribunal also referred to various judicial precedents that reaffirmed the importance of considering the intent and good faith of the appellants in cases involving procedural disputes.
The Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) has directed the Central Goods and Services Tax ( CGST ) Department to refund ₹28.3 lakh to Bank of Baroda. The refund pertains to the non-transitioned CENVAT credit of Krishi Kalyan Cess ( KKC ) that the bank could not transfer to the Goods and Services Tax ( GST ) regime via the TRAN-1 form.
The tribunal noted that CENVAT credit, which could not be transitioned under GST, must be refunded according to existing laws, even though the KKC itself was discontinued post-GST implementation. The order, issued by Dr. Suvendu Kumar Pati, Member ( Judicial ) of CESTAT, instructs the CGST department to process the refund within two months, along with applicable interest. In its ruling, CESTAT bench of Dr. Suvendu Kumar Pati, Member ( Judicial ) set aside the earlier decision of the Commissioner ( Appeals ) to reject the refund, stating that the unutilized credit of KKC must be refunded.
In a recent ruling, the West Bengal bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) held that the contract services for construction related to electricity transmission for Gujarat Energy Transmission Corporation Ltd. ( GETCO ) by the applicant are exempted from service tax.
The CESTAT bench held that the works contract services provided by the applicant to Gujarat Energy Transmission Corporation Ltd. (GETCO) for the activity of transmission of electricity are exempt from service tax. The bench, comprising of Ramesh Nair (Judicial) and C L Mahar (Technical), allowed the appeal filed by the appellant, Vraj Constructions, and the impugned order was set aside.
The Allahabad Bench of the Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) in a recent matter upheld the right of an Appellant to receive accrued Interest on Pre-Deposit amount deposited with the Appellate Authority to permit filing of Appeal, notwithstanding the Appellate Authority’s breach of accepting a pre-deposit amount higher than the statutorily permissible limit under Section 35F of the Central Excise Act, 1944.
Concludingly, the Judicial Member pronounced that accepting a pre-deposit in excess of the statutory limit of Ten Crore Rupees is a violation committed by the Adjudicating Authority; such acceptance does not absolve them of the liability to pay interest on the pre-deposit subsequent to disposal of the Appeal under Section 35FF of the Central Excise Act, 1944.
In a recent ruling, the Mumbai bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) quashed the impugned order and the appellants’ Customs Broker license was restored.
The bench, comprising of S K Mohanty and M M Parthiban, directed to set aside the impugned order passed by the Commissioner of Customs (General), Mumbai, as it did not find any merit in revocation of the CB license of the appellants, for forfeiture of security deposit, and for imposition of penalty, as there was no violation of regulations 10(d) and 10(n) of the CBLR 2018. The bench allowed the appeal in favor of the appellants.
The Ahmedabad Bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) held in a recent case that liability to pay Service Tax cannot be levied on charges paid to Advertisement agencies by a Franchisor which are in fact, collected from the Franchisees by virtue of an Agreement executed between both Parties.
The 2-Member Bench of CESTAT, Ahmedabad comprising Ramesh Nair, Judicial Member and C.L. Mahar, Technical Member, after perusing the material and submissions made on record proceeded to follow the binding precedent set by the Apex Court in Intercontinental Consultants underlining the unconstitutionality of Rule 5(1). Additionally, the 2-Member Bench, while allowing the present Appeal held that even if Rule 5 was ignored by the Tribunal, the valuation of gross value is determined by Section 67 of the Finance Act, 1994.
In a recent ruling, the Mumbai bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) allowed the appeal in favor of the appellant Reliance Jio Infocomm Ltd.
The bench observed that there was no justification for ordering for recovery of interest on the amount determined as payable under Rule 6(3)(b) of the CCR 2004, since the appellant had CENVAT credit balances far exceeding amounts determined as payable. The bench held that in this case, service tax demand is not sustainable. The bench noted that We also note that the Commissioner was wrong in imposing a penalty on the appellants by invoking the provisions of Rule 15 of the CENVAT Credit Rules. This provision only applies in cases where CENVAT credit has been improperly obtained or used. The bench, comprising of S K Mohanty and M M Parthiban, allowed the appeal in favor of the appellant and set aside the impugned order.
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