I. TRIBUNAL
10. [2019-TIOL-914-CESTAT-MUM] ABM Knowledge Ltd. vs. Commissioner of
Customs, Mumbai, Appeal-III Date of Order: 12th February, 2019
Registration of premises is not a condition
precedent to avail CENVAT credit.
FACTS
Whether the Appellant is entitled to avail
input credit on invoices which are issued in the name of the premises other
than the registered premises?
HELD
The Tribunal
noted that there is no condition in the CENVAT Credit Rules, 2004 which
prescribes that registration of premises is a condition precedent for claiming
CENVAT credit and in its absence the claim has to be rejected. It was held that
it is a settled legal principle that any beneficial provision should be
interpreted liberally. There is also no dispute that there is a lapse, but it
is merely a procedural lapse for which the substantive benefit of CENVAT credit
cannot be denied. Thus, the appeal is allowed.
11.
[2019-TIOL-931-CESTAT-MUM] Kalika Steel Alloys Ltd. vs. Commissioner of Central
Excise, Customs and Service Tax, Aurangabad Date of Order: 25th April, 2018
Since appellant was entitled for CENVAT
credit on the excess paid service tax, the entire exercise is revenue neutral.
FACTS
The appellant
paid service tax on GTA on 100% of the amount without availing abatement of 75%
as available and availed the credit of the entire tax paid. Objection was
raised that since, as per notification, tax is payable only on 25%, the credit
of the service tax paid on 75% is inadmissible. The credit was reversed as
advised by the audit party and the excess payment was adjusted against tax
liability for the subsequent period. Revenue’s allegation is that such adjustment
can be made only during the succeeding month and not beyond that. Accordingly,
the present appeal is filed.
HELD
The Tribunal noted that unlike in Central
Excise law, wherein the unconditional notification is to be followed
mandatorily, similar provision is missing in service tax. Therefore, payment of
service tax on GTA on 100% of the amount is legal and correct. Further, since
the entire exercise is revenue neutral, the impugned order is unsustainable and
hence set aside.
12.
[2019-TIOL-1013-CESTAT-HYD] Commissioner of Customs, Central Excise &
Service Tax vs. Vignan Tutorials Date of Order: 4th January, 2019
The cost of study materials and textbooks
cannot be included in the value of services rendered for commercial coaching
and training centre.
FACTS
The appellant
is engaged in providing commercial training and coaching services. The Revenue
authorities were of the view that the amounts collected towards the cost of
study material needs to be included in the value of service. The Adjudicating
Authority, after following due process of law, confirmed the demand raised. The
First Appellate Authority held in favour of the appellant and accordingly the
present appeal is filed.
HELD
The Tribunal noted that separate invoices
are prepared for the services rendered for coaching and for the textbooks.
Further, it was also noted that the textbooks are available to any other person
not joining the coaching and training service centre as the books are freely
available in the market. Accordingly, it was held that the value of books is
not includible in the value of service and the appeal was dismissed.
13. [2019-TIOL-864-CESTAT-MAD] VLCC Healthcare
Ltd., Chennai vs. the Commissioner of GST and Central Excise, Chennai South Date of Order: 11th February, 2019
The department cannot force the assessee to
pay 5% or 6% of the value of exempted services when the assessee has exercised
the option of reversing the proportionate credit.
FACTS
The assessee
provides “Beauty Treatment Service” and “Health Club and Fitness Service”. They
are also doing trading activity and selling their products to their customers.
Trading activity is deemed to be an exempted service with effect from
01.04.2011. The department alleges that since separate accounts are not
maintained, they have to pay an amount equal to 6% of value of their exempted
clearances for the reason that they have not intimated the department about
exercising the option.
HELD
The Tribunal noted that the appellants have,
in fact, issued a letter to the jurisdictional Range Officer explaining that
they were availing only the proportionate credit on the value of taxable
services, which is also reflected in their balance sheet as well as their ST-3
returns. It was held that the department cannot force them to pay 5% or 6% of
the value of exempted services when the option of reversing the proportionate
credit is exercised. Relying on the decision of Mercedes Benz
[2015-TIOL-1550-CESTAT-MUM], the demand was set aside.
14. 2019 [21] G.S.T.L. 37 (Tri. Chennai) MAS Logistics
vs. Principal Commr. of C.T. & C. Ex., GST, Chennai Date of Order: 25th September, 2018
Logistic services provided in India to
foreign company for re-export of return goods, amounts to export of service.
Eligible for refund of tax on input services used for such re-export of return
goods.
FACTS
The appellant assessee provided logistic
support service of return of imported goods on instruction of the shipper,
namely, Jinneng Energy Technologies Ltd., China (JETL, for short) and received
consideration in convertible foreign exchange. They also availed various input
services for export of logistic services; hence they filed a refund claim. The
said refund claim of the appellant was rejected by the Revenue stating that it
did not appear to be in relation to export of service, rather, it seemed to be
incurred for import of goods. The same was upheld by the Commissioner
(Appeals). Aggrieved, the appellant preferred an appeal before the Tribunal.
HELD
The Hon’ble Tribunal held that the allegation
of the department, that appellant acted as intermediary and so place of
provision of service within India cannot be sustained, as the appellant was
engaged by H & H, China, to whom they actually provided service and raised
invoices on account of facilitating re-export of goods. As the contract between
the shipper (JETL) and the importer was cancelled, the delivery of goods was
not taken by the importer and consequently goods were taken back to China,
resulting in re-export of the goods. The input services availed for doing such
return of goods to China are services availed for exports only. It was H &
H, China who acted as an intermediary and as recipient of logistic services
situated outside India, for which consideration was paid in convertible foreign
exchange, so it is export of service. Consequently, the appeal filed by the
appellant was allowed and the refund along with consequential relief was
granted.
15. 2019 [21] G.S.T.L. 167 (Tri. Mumbai) Onward
E-Services Ltd. vs. Commissioner of Service Tax, Mumbai Date of Order: 19th April, 2018
Penalty against suppression not sustainable
when defaulted tax paid along with interest before issuance of show-cause
notice.
FACTS
The appellant assessee, a provider of
software maintenance and repair services and information technology software
services, short-paid service tax during the period April, 2011 to August, 2012.
Although he subsequently paid the said amount along with interest before
issuance of a show-cause notice and also intimated the department to conclude
the matter in light of section 73(3) of the Finance Act, 1994, the Revenue
authorities still issued show-cause notice and confirmed the demand along with
interest and imposed penalty u/s. 78 and
77 of the Act, alleging suppression.
HELD
The Hon’ble
Tribunal, on noting that the appellant furnished the details of the records in
the ST-3 returns and only defaulted in the payment of the tax collected, thus
provided with immunity u/s. 73(3) of the Act, it set aside the penalty u/s. 78 in absence of suppression, holding that mere
default in the payment of tax could not amount to evasion of tax. The Tribunal
allowed the appeal in light of similar observations and various precedents.
16. 2019 [21] G.S.T.L. 165 (Tri-All.) Bhootpurva
Sainik Security & Detective Service vs. C.C.E., Allahabad Date of Order: 13th February, 2018
Show-cause
notice issued in the name of firm after death of partner, no liability on legal
heir for any dues.
FACTS
The appellant provided certain services and
was liable to pay service tax on the same. The show-cause notice was sent
through Speed Post but was returned undelivered; consequently, the same was
pasted at the address obtained from the records by the department and was also
displayed on the notice board of the division office of Varanasi. An ex-parte
order was passed confirming the demand along with penalty under the Finance
Act, 1994. Later, Revenue failed to trace any of the partners of the firm
against whom the order was confirmed. However, they could find the legal heir
(Mr. Shashi Bhushan Pandey) of one of the partners for recovery of dues.
Mr. Shashi Bhushan filed a first appeal
against the confirmed order stating that neither any show-cause notice was issued
upon him nor was any order communicated. Rather, the order was communicated to
the legal heir (Mr. Bhushan) after 3 years and 8 months of passing of the
order. But the first appeal was rejected and, thus aggrieved, the legal heir
filed an appeal before the Tribunal. The legal heir also filed a miscellaneous
application to bring on record that the partnership deed stated that the late
person was a partner in the firm along with two other partners.
HELD
The Hon’ble Tribunal held that the legal
heir of the late partner was not liable for any dues of the appellant as the
show-cause notice was issued after the death of the partner. Revenue was
directed to locate the remaining partners for recovery of dues. Also, there was
no proper authority with the Hon’ble Tribunal to pass the impugned order as it
was not evident from the show-cause notice whether it was issued on the
proprietorship or on the partnership firm. The appeal was, thus, allowed.
II. SUPREME COURT
17. [2019-TIOL-150-SC-ST] Commissioner of Service
Tax, Mumbai-II vs. Greenwich Meridian Logistics (I) Pvt. Ltd. Date of Order: 1st April, 2019
Appeal
dismissed on account of inordinate delay in filing the same.
FACTS
The assessee is a multi-modal transport
operator engaged in booking cargo space in shipping lines and thereafter
allotting space to its customers. A demand of service tax was raised on the
difference between the freight received and freight paid under the category of
business auxiliary service. The Tribunal held that the slots are purchased by
the assessee and therefore they are neither promoting nor marketing the
services of the shipping line, nor is the shipping line their client.
Accordingly, the demand was set aside. Thus, the present appeal is filed by the
department.
HELD
The Court noted that there is an inordinate
delay of 1,180 days in filing the appeal; therefore, the appeal is dismissed.
