CESTAT Weekly Flashback for the period 26 January To 1 February 2025.
Table of Contents
BSNL Is PSU And PSU Can’t Have Malafide Intentions For Non-Discharge Of Duty: CESTAT
Case Title: M/s. General Manager, GMTD, BSNL Versus Commissioner of CGST, Customs & Central Excise
The Delhi Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that BSNL is a Public Sector Undertaking (PSU) and PSUs cannot have malafide intentions for non-discharge of duty.
The bench of Dr. Rachna Gupta (Judicial Member) And Hemambika R. Priya (Technical Member) has observed that appellant/assessee entitled for the availment of the Cenvat credit and the utilization or the discharge of their future liability vis-à-vis service tax and even Education Cess and Secondary Higher Education Cess. The appellant had been regularly filing its ST-3 returns and its records were being regularly audited by the department. Thus, the entire material was already to the notice of the department.
Cenvat Credit Scheme Is Beneficial Scheme, Can’t Be Taken Away From Taxpayers On Technical Grounds: CESTAT
Case Title: M/s Shriram Rayons Versus Commissioner of CGST & Central Excise, Udaipur
The Delhi Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that Cenvat credit scheme is a beneficial scheme for the taxpayers and the benefit of this scheme cannot be blocked or taken away from the taxpayers on technical and procedural grounds.
The bench of Dr. Rachna Gupta (Judicial Member) has observed that the challan number in show cause notice is nothing but a typographical error. Substantial benefit which is otherwise available to the appellant cannot be denied merely on the basis of the typographical error that too, committed at the end of the department.
No Evidence Against Customs Broker To Prove Misdeclaration Except Retracted Statement: CESTAT Quashes Revocation Of License
Case Title: M/s. V S Bhagwati Shipping Versus Commissioner of Customs
The Delhi Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has quashed the revocation of customs broker license and held that there was no evidence against customs broker to prove misdeclaration except retracted statement.
The bench of Dr. Rachna Gupta (Judicial) and Hemambika R. Priya (Technical Member) has observed that there is also no evidence on record to prove that Areca nuts were being imported from Indonesia and black peppers were being imported from Vietnam. In absence of any such documentary evidence the document issued by the Sri Lankan Government (Certificate of Origin) is wrongly doubted by the department. The sole statement of appellant himself alleging it to be his confession has wrongly been used against him while penalizing him.
Relief To Gutka Manufacturer: Full Excise duty Can’t Be Demanded For Period When Machines Were Not In Operation: CESTAT
Case Title: Maruti Tabacco Products P Limited Versus Commissioner of Central Excise & ST, Vadodara
In a major relief to Gutka Manufacturer, the Ahmedabad Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that full excise duty cannot be demanded for the period when the machines were not in operation.
The bench of Dr. Ajaya Krishna Vishvesha (Judicial Member) and C.L. Mahar (Technical Member) has observed that the essence of the Pan Masala Packing Machines (Capacity Determination and Collection of Duty) Rules, 2008 is that the manufacturer has to pay duty for the operational days of the machines and since the appellant has deposited the proportionate amount of duty of working days of the machines, we find that Central Excise duty cannot be demanded for the period when the machines remained non-operational.
No Statutory Provision For Claiming Interest On Pre-Deposit: CESTAT
Case Title: M/s Amkap Marketing Pvt. Ltd. Versus Commissioner of Central Excise & CGST, Allahabad
The Allahabad Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that there is no statutory provision for claiming interest on pre-deposit.
The bench of Sanjiv Srivastava (Technical Member) has observed that The amount deposited by the petitioner is pursuant to an interim order passed by the Court and is not in the nature of payment of excise duty and hence, the provisions of the Central Excise Act for refund would not be applicable. Consequently, the provisions of Section 11BB of the Central Excise Act which provides for interest on delayed refund, would not be applicable. It is settled legal position that in the absence of a statutory provision entitling the assessee to interest, a mandamus cannot be issued to the Revenue to pay interest.
No Service Tax Payable On Free Allowance Given To Employees By Bharti Airtel: CESTAT
Case Title: Bharti Airtel Ltd Versus Commissioner of Central Goods & Service Tax, Gurugram
The Chandigarh Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that no service tax is payable on the free allowance given to the employees by the appellant, Bharti Airtel which is in the nature of discount/concession.
The bench of S. S. Garg (Judicial Member) and P. Anjani Kumar (Technical Member) has observed that the Show Cause Notice is vague and does not specify the service which is rendered by the appellant; moreover, the benefit of discounts/ free allowance is accruing to the employees rather than the appellant who is the service provider.
Adjustment Of Refund Against Confirmed Demand During Pendency Of Appeal Amounts To Coercive Recovery, Not Permissible: CESTAT
Case Title: M/s Indus Towers Limited Versus Commissioner of Central Excise, Central Goods and Service Tax, Gurugram
The Allahabad Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has observed that adjustment of refund against a confirmed demand during the pendency of an appeal amounts to coercive recovery and is not permissible under the law.
The bench of S. S. Garg (Judicial Member) and P. Anjani Kumar (Technical Member) has observed that the amount adjusted from the total refund sanctioned to the appellant is refundable to the appellant at the rate of 12% per annum computed from the date of deposit till the date of its refund.
Import Of Refrigerant Gas In Cylinder Requires Permission From Controller Of Explosive: CESTAT Upholds Penalty On Container Corporation of India For Misdeclaration
Case Title: M/s. Container Corporation of India Ltd. Versus Commissioner of Customs (Appeals)
The Delhi Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has upheld the penalty on Container Corporation of India (CCI) for misdeclaration and held that import of refrigerant gas in cylinders requires permission from the controller of explosives.
The bench of Binu Tamta (Judicial Member) has observed that no evidence has been placed on record by the appellant, Container Corporation of India that when the goods arrived in their custody the container was without any seal or the seal was broken. The plea taken by the appellant that the goods were in deployment of CISF has already been dealt by the Delhi High Court to say that the appellant cannot escape such burden by shifting its responsibility upon the CISF.
Appellate Authority Can Condone Delay Only Upto 30 Days: CESTAT
Case Title: Shri Santhosh Kumar Shetty Saja Versus The Principal Commissioner of Central Excise and Central Tax, Mangalore Commissionerate
The Bangalore Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that appellate authority to entertain the appeal by condoning delay only upto 30 days after the expiry of 60 days which is the normal period for preferring appeal.
The bench of Dr. D.M. Misra (Judicial Member) and R Bhagya Devi (Technical Member) has observed that the legislature intended the appellate authority to entertain the appeal by condoning delay only upto 30 days after the expiry of 60 days which is the normal period for preferring appeal. Therefore, there is complete exclusion of Section 5 of the Limitation Act.
Dept. Action In Demanding Alleged Wrongly Availed Credit By Invoking Extended Period Of Limitation Is Not Justified: CESTAT
Case Title: M/s.Xomox Sanmar Ltd. Versus The Commissioner of GST & Central Excise
The Chennai Bench Of Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that the action of the department in proposing and demanding the allegedly wrongly availed credit by invoking the extended period of limitation is justified.
The bench of P. Dinesha (Judicial Member) has observed that nothing is brought out on record to indicate as to what prevented the department from issuing the show cause notice immediately, after noticing the wrong availment etc. during audit. Why or what prompted them to wait for three more years to issue the show cause notice, also remains conspicuous. More than these, even when the same was brought to the notice through their reply to the SCN, the same has not been considered at all.
Value Of “Premium” Or “Salami” Is Exigible To Service Tax Under “Renting Of Immovable Property”: CESTAT
Case Title: Rajasthan State Industrial Development & Investment Corporation Ltd Versus The Commissioner, Central Excise & Service Tax Commissionerate
The Delhi Bench Of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that value of “premium” or “salami” is exigible to service tax under “renting of immovable property” for the period prior to 01.07.2012 and under section 65(105)(zzzz) of the Finance Act and from 01.07.2012 under section 66B of the Finance Act.”
Volvo Can’t Be Expected To Correlate Its Imports With Exports Of Person To Whom License Was Originally Issued: CESTAT
Case Title: M/s.Volvo India Private Ltd. Versus The Commissioner of Custom
The Chennai bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that Appellant, Volvo cannot be expected to correlate its imports with the exports of the person to whom the license was originally issued.
The bench of P. Dinesha (Judicial Member) and Vasa Seshagiri Rao (Technical Member) has observed that there is nothing in the license which restricts the import of internal combustion engines only to such internal combustion engines as would have been used in the goods which are permitted to be exported by the authorization.
Bonafide Mistake By Dept. In Not Imposing Mandatory Penalty: CESTAT Directs Customs Duty Evader To Pay
Case Title: M/s Sarvatra International Versus Commissioner of Customs, ICD Tuglakabad, New Delhi
The Delhi Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has directed the customs duty evader to pay penalty as it was a bonafide mistake by the department in not imposing mandatory penalty.
Mis-Classification Of Goods Is No Ground Of Confiscation Or Imposition Of Penalty: CESTAT
Case Title: M/s. Aska Equipments Ltd. Versus Commissioner of Customs(Import)
The Delhi Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that mis-classification of goods is no ground of confiscation or imposition of penalty. No penalty is imposable when it is a matter of difference of opinion regarding classification of goods by the assessee and by the Department.
