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 8, 2024 to September 14, 2024.
In a recent ruling, the Mumbai bench of the Customs Excise and Service Tax Appellate Tribunal (CESTAT) allowed the appeal in favor of the assessee and held that the demand and penalty in the impugned order have no basis in law.
The bench observed that the box office represents a collaboration between the exhibitor and distributor. While not taxed itself, it incurs costs for services from both parties, including business support services for film screenings. It is also observed that the adjudicating authority overlooked the distributorâs essential role in this collaboration. The CESTAT bench, comprising Mr. Dilip Gupta and Mr. C J Mathew, held that the demand and penalty in the impugned order have no basis in law. The bench set aside the impugned order. The bench allowed the appeal in favor of the assessee.
The Customs, Excise & Service Tax Appellate Tribunal (CESTAT) Chennai Bench quashed the order demanding the service tax along with interest and imposed penalties under âMaintenance and Repair Servicesâ. As the service tax cannot be imposed upon mere assumption and consideration of figures.
The CESTAT Bench composed of Vasa Seshagiri Rao, Member ( Technical ) and Sulekha Beevi.C.S, Member ( Judicial ) observed that Demand of service tax cannot be raised on mere book entries assuming such figures as consideration. Upon the facts, the court is convinced that the appellant has not received any separate consideration for providing maintenance and repair services during the warranty period. So the demand cannot be sustained and requires to be set aside, the tribunal noted. In result the impugned order was set aside and the appeal was allowed with consequential reliefs.
The Principal Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Delhi recently held that Processing Charges incurred in course of provision of services by medical service providers are encompassed within the ambit of âHealthcare Servicesâ and thereby exempted from Service Tax.
The Principal Bench of the Customs, Excise and Service Tax Appellate Tribunal, Delhi presided over by Binu Tamta, Judicial Member held that the Revenue Authorities have fallaciously declared the aforementioned series of services between Life Care Hospital and Life Care Medicos as âbusiness auxiliary servicesâ when it has been extensively established that they are services essential to the treatment of patients. Concludingly, CESTAT dropped the demand proceedings against the Appellant and set aside the Order while allowing the present appeal.
The Ahmedabad bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) has rejected the refund claim for interest on delayed payment due to post-clearance oil price variations, citing the pending Show Cause Notice and noting that there was no merit in the appellantâs claim, which was unsupported by the evidence and arguments presented.
The bench, consisting of Ramesh Nair ( Judicial Member ) and Raju ( Technical Member ), found the appellantâs claim misleading. They noted that the SVLDRS Scheme aimed to settle unpaid dues rather than refunding legally paid dues. As the show cause notice demanding interest was confirmed and settled under SVLDRS, the refund claim related to this interest could not be upheld. The tribunal also observed that addressing unjust enrichment was superfluous at this stage since the primary decision was that the refund was not admissible. The tribunal dismissed the appeal, finding no merit in the appellantâs claim for refund. The claim for refund was not supported by the evidence and arguments presented.
In a recent ruling, the Delhi bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) has directed the Customs Commissioner to issue a new order after reviewing the Assessing Officerâs detailed order concerning the evaluation of 18 aluminum scrap import bills.
A two-member bench consisting of Justice Dilip Gupta (President) and P.V. Subba Rao addressed the departmentâs presentation of speaking orders for the 18 Bills of Entry. The bench determined that, given the new information provided, the case should be remanded to the Commissioner (Appeals) for a fresh review. The Commissioner (Appeals) is instructed to reassess the case based on the speaking orders and issue a new decision.
The single bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) in Delhi, has upheld the Central Excise duty demand under Section 11A read with Section 174 of the CGST Act, 2017, due to a shortage of raw materials and finished goods, and has confirmed the liability for the associated penalty.
The Tribunal Comprising Binu Tamta (Judicial member) observed that the imposition of mandatory penalty under Section 11AC (1) (a) was justified for detected shortages, supported by Apex Court decisions emphasizing penalty for rule violations. The Tribunal affirmed the decision, dismissing the appeal. The Tribunal upheld the imposition of central excise duty and penalty for the shortage in stocks, with no grounds for interference in the impugned decision. The appeal was thus dismissed.
In a recent Judgement, the Delhi bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) has set aside the order that wrongly rejected the transaction value under Rule 8 of the Customs Valuation Rules, noting that there was no evidence of over-valuation of goods and no reasonable doubt about the truth or accuracy of the declared transaction value.
Therefore, the two member bench of the tribunal Dr Rachana Gupta ( Judicial member ) and P.V. Subba Rao ( Technical member ) set aside the impugned order, ruling that the declared value in the shipping bills should be accepted. As a result, the confiscation, fines, and penalties imposed were deemed unwarranted. Both appeals were allowed, and consequential relief was granted to M/s Universal Offset and Shri Vikas Gupta.
The Delhi bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) ruled that the transportation of goods for domestic and international trade is exempted from âBusiness Auxiliary Servicesâ (BAS), and therefore no service tax demand can be made.
In a similar case (Greenwich Meridian Logistics Pvt Ltd.), the tribunal ruled that transactions involving the purchase and sale of shipping space do not fall within the scope of BAS, as they are principal-to-principal transactions, and no agency relationship exists. Considering the facts and prior rulings, the two member bench of the tribunal comprising Dr. Rachana Gupta (Judicial member) and Hemambika R. Priya (Technical member) found no justification for the service tax demand and set aside the impugned order. Consequently, all demands, interest, and penalties were nullified, and the departmentâs cross-objections were dismissed.
In a recent judgement, the Delhi bench of the Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) ruled that penalty or late delivery charges cannot be subjected to service tax under Section 66E of the Finance Act, 1994.
The bench, comprising Judicial Member Binu Tamta and Technical Member Hemambika R. Priya, reviewed the submissions and observed that the issue had been settled in previous rulings, such as the Tribunalâs decision in M/s South Eastern Coal Fields Ltd. The bench concluded that penalties and late delivery charges could not be subjected to service tax under Section 66E of the Finance Act, 1994. Accordingly, the impugned order dated 08.01.2019 was set aside, and the appeal was allowed.
The Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ), Ahmedabad Bench stated that Goods with Domestic Tariff Area ( DTA ) clearance, used for manufacturing of goods, cannot be denied the Excise Duty Exemptions.
The CESTAT Bench comprising Ramesh Nair, Judicial Member and CL Mahar, Technical Member observed that since there was no evidence to prove the manufacturing was done out of imported goods, the matter was remanded with specific directions to the Adjudicating Authority to establish the same. In the denovo adjudication, due to lack of evidence it came to the conclusion, i.e the goods were manufactured out of indigenous as well as imported raw materials.
The Bench also went through the SCN based on the allegations of manufacture of subject goods out of indigenous and imported raw material and finds that as bald and the same is not based on any evidence. Therefore, despite remand the matter to establish this fact, the Adjudicating Authority has decided the source of raw material only on the assumptions. Therefore, in these peculiar facts, the benefit of doubt clearly goes in favor of the appellant. So accordingly, in the absence of evidence to prove that the raw materials were used in the subject goods, the appellant cannot be denied exemption in respect of DTA clearances. In view of all, the court set-aside the impugned order and allowed the appeal.
In a recent decision, the Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) of Delhi has set aside a service tax demand against a consultant, ruling that the tax assessment was based solely on turnover information from income tax data that lacked proper investigation.
In the result, CESTAT set aside the service tax demand, stating that the department had not followed due diligence in the case. Thus the appeal filed was allowed, bringing relief to the consultancy firm.
The Delhi bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) has ruled in favor of M/s Raghuveer Concast Pvt. Ltd. and its Directors, Mr. Chand Singhal and Mr. Inder Mohan Singhal, allowing them to claim Cenvat credit for excise duty paid for mild steel scrap on strength of invoices issued by registered dealers
The tribunal, consisting of Justice Dilip Gupta ( President ) and P.V. Subba Rao ( Technical Member ), observed contradictions in the departmentâs stance. While accepting the existence of the dealers and manufacturers for purposes such as registration and notices, the department denied their existence when it came to Cenvat credit claims. The tribunal concluded that the impugned order was unsustainable due to these inconsistencies. Consequently, the tribunal set aside the impugned order and allowed the appeal, granting consequential relief to the appellant.
The Ahmedabad Bench of Customs, Excise, and Service Tax Appellate Tribunal ( CESTAT ) quashed the excise duty demand and allowed the appeal in favor of the appellant.
The bench observed that the adjudicating authority has erred by violating the principles of natural justice, making the statement relied upon by the revenue inadmissible as evidence of clandestine removal. By virtue of Section 9D of the Central Excise Act, 1944. , it was mandatory to conduct cross-examination of the witness, and thus the third-party evidence is insufficient to prove clandestine removal. The CESTAT bench, comprising Ramesh Nair and C L Mahar, held that the demand would not be sustained as the revenue could not establish its case of clandestine removal. The appeal was allowed, and the impugned order was set aside.
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