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Latest Updates: Punjab + Uttarakhand + Bihar + Rajasthan + Gujarat + Madhya Pradesh Notification | Service tax & Central Excise Notification | PPT presentation on GST + Summary for the month of December, 2014 [see ‘Notes & News’]

Recent Updates

2015-VIL-40-CESTAT-DEL-CE|CENTRAL EXCISE |CESTAT Cases | 23.01.2015

RATUSARIA STEEL PVT LTD Vs CCE & ST RAIPUR: 10.12.2014 - Cenvat Credit – Denial cenvat credit on rough forged rolls as inputs - Show cause notice was issued on the premise that these rough forged rolls are capital goods and respondent is entitled to take 50% of Cenvat Credit in the first year and as the appellant has availed 100% credit on said goods, therefore the impugned proceedings were initiated – HELD - The finding of the Commissioner (Appeals) are confirms forged rolls are inputs used for manufacture of specified capital goods i.e. machine rolls and as such are admissible for Cenvat credit in terms of Rule 2(k) of Cenvat Credit Rules, 2004 – Hence, specified rough forged rolls are not... [Read more]

RATUSARIA STEEL PVT LTD Vs CCE & ST RAIPUR: 10.12.2014 - Cenvat Credit – Denial cenvat credit on rough forged rolls as inputs - Show cause notice was issued on the premise that these rough forged rolls are capital goods and respondent is entitled to take 50% of Cenvat Credit in the first year and as the appellant has availed 100% credit on said goods, therefore the impugned proceedings were initiated – HELD - The finding of the Commissioner (Appeals) are confirms forged rolls are inputs used for manufacture of specified capital goods i.e. machine rolls and as such are admissible for Cenvat credit in terms of Rule 2(k) of Cenvat Credit Rules, 2004 – Hence, specified rough forged rolls are nothing but inputs only – Cenvat Credit is admissible on rough forged rolls – Assessee appeal allowed [Read less]

2015-VIL-41-CESTAT-DEL-CE|CENTRAL EXCISE |CESTAT Cases | 23.01.2015

JCT LTD Vs COMMISSIONER OF CENTRAL EXCISE, JALLANDHAR: 23.07.2014 - Central Excise – Duty demand on the spun yarn of Chapters 52 and 55 of the Central Excise Tariff on the spindles which had been subjected to the processes of winding/cheese winding and singeing and doubling/multifolding prior to being used captively for manufacture of fabrics; and on the man-made spun yarn of Chapter 55 purchased from outside which had been subjected to the above processes before being used in the manufacture of fabrics – Revenue contention is since these processes appeared to be manufacturing processes which added to the value of the yarn, the cost of these processes was also required to be added to the cos... [Read more]

JCT LTD Vs COMMISSIONER OF CENTRAL EXCISE, JALLANDHAR: 23.07.2014 - Central Excise – Duty demand on the spun yarn of Chapters 52 and 55 of the Central Excise Tariff on the spindles which had been subjected to the processes of winding/cheese winding and singeing and doubling/multifolding prior to being used captively for manufacture of fabrics; and on the man-made spun yarn of Chapter 55 purchased from outside which had been subjected to the above processes before being used in the manufacture of fabrics – Revenue contention is since these processes appeared to be manufacturing processes which added to the value of the yarn, the cost of these processes was also required to be added to the cost of yarn on spindles for the purpose of payment of duty – Valuation - Captive consumption – HELD - w.e.f. 16-3-1995 Chapter Note 1 of Chapter 52 was replaced by a new note providing that in relation to the products of Headings 52.04, 52.05 and 52.06 the process of printing, bleaching, mercerizing, twisting, texturising, doubling, multifolding, cabling or any other process or any one or more of these processes or the conversion of any form of the said product into another form of such product shall amount to manufacture. Similar amendment was made w.e.f. 16-3-1995 in the corresponding Chapter Note of Chapter 55. Thus, w.e.f. 16-3-1995, the process of winding i.e. transferring the yarn from bobbins to cones was no longer a process of manufacture. In view of this, there is no question of adding the cost of winding by charging duty on the spun yarn at spindle stage. The impugned order, therefore, upholding the duty demand is not sustainable and the same is liable to be set aside – Duty on doubled/multifolded yarn is cleared for captive consumption – HELD - Since doubled/multifolded yarn is cleared for captive consumption within the factory for manufacture of fabrics the cost of winding, sungeing doubling/multifolding gets included in the cost of fabrics which is cleared on payment of duty. Duty on cost of these processes cannot be charged at single yarn stage by including the cost of these processes in the value of yarn at the spindle stage – The impugned order for duty demand is not sustainable and set aside – Assessee appeal allowed [Read less]

2015-VIL-35-JHR|VAT |High Court Cases | 23.01.2015

HINDUSTAN CONSTRUCTION COMPANY LTD Vs STATE OF JHARKHAND: 07.01.2015 - Jharkhand Value Added Tax Act, 2005 - ex parte order of assessment – Method of service of notice in case of high value case – Limitation - Violation of fundamental right of the assessee - HELD - It ought to be kept in mind by the State that when the State is imposing such a huge liability of tax of approximately Rs. 90 Lakhs, more care should have been taken by the State to the notice upon the petitioner or upon the assessee. Not only orthodox methods of service of notice should have been followed, but, over and above the orthodox methods, the State should have served the notice upon assessee by sending any employee of th... [Read more]

HINDUSTAN CONSTRUCTION COMPANY LTD Vs STATE OF JHARKHAND: 07.01.2015 - Jharkhand Value Added Tax Act, 2005 - ex parte order of assessment – Method of service of notice in case of high value case – Limitation - Violation of fundamental right of the assessee - HELD - It ought to be kept in mind by the State that when the State is imposing such a huge liability of tax of approximately Rs. 90 Lakhs, more care should have been taken by the State to the notice upon the petitioner or upon the assessee. Not only orthodox methods of service of notice should have been followed, but, over and above the orthodox methods, the State should have served the notice upon assessee by sending any employee of the State. The State has several vehicles and persons with them. When such a huge liability of tax is imposed or is going to be imposed, the State should have served the notice upon the assessee by sending any responsible employee instead of passing exparte order. When there is more liability of amount of tax, more care should have been taken by the State, at least in following the procedure. Always exparte orders have inbuilt difficulties because correct facts along with correct documents are not available with the assessing office - The provision of sub-section 2 of Section 42 is also applicable whenever any order is passed in writ petition under Article 226 of the Constitution of India, mainly for the reason that there is an exparte assessment order without giving any opportunity of being heard to the assessee and once there is a violation of principles of natural justice, the impugned order will be arbitrary and once there is arbitrariness in passing of the order, the said order is always violative of right of equality vested in the petitioner under Article 14 of the Constitution of India. Thus, the impugned order is violative of fundamental right guaranteed to the petitioner – Matter is remanded to CTO to decide afresh the tax liability, if any, of the petitioner. The relaxation of the time limit as mentioned in Subsection 2 of Section 42 which is applicable in the case of appellate order or revisional order, is also applicable whenever any order is passed in the writ petition under Article 226 of the Constitution of India. Hence, there is no question of limitation whatsoever arises in this case, if the assessing officer is deciding within the time limit, as stated in sub-section 2 of Section 42 of the Act [Read less]

2015-VIL-38-CESTAT-DEL-ST|SERVICE TAX |CESTAT Cases | 23.01.2015

C.C.E. PANCHKULA Vs M/s KRISHNA CYLINDERS: 08.01.2015 - Service Tax - Goods transport agency services – Non-payment of service tax for the period 01.04.2005 - 31.03.2006 - Penalty - Benefit under section 80 of – HELD - Admittedly in this case audit took place on 30.08.2006 and 31.08.2006. It was revealed that the respondent has not paid the service tax for the period 01.04.2005 - 31.03.2006 on outward transportation services. It is also fact on record that the levy of service tax by the respondent in outward transportation agency services came into the fact on 01.01.2005. We further find that for the subsequent period 01.01.2006-31.03.2007 the respondent has paid the service tax on pointing... [Read more]

C.C.E. PANCHKULA Vs M/s KRISHNA CYLINDERS: 08.01.2015 - Service Tax - Goods transport agency services – Non-payment of service tax for the period 01.04.2005 - 31.03.2006 - Penalty - Benefit under section 80 of – HELD - Admittedly in this case audit took place on 30.08.2006 and 31.08.2006. It was revealed that the respondent has not paid the service tax for the period 01.04.2005 - 31.03.2006 on outward transportation services. It is also fact on record that the levy of service tax by the respondent in outward transportation agency services came into the fact on 01.01.2005. We further find that for the subsequent period 01.01.2006-31.03.2007 the respondent has paid the service tax on pointing out by the audit team and there was no allegation against the respondent in those proceedings for suppression of the facts. In these circumstances, we are convinced with the arguments advanced by the Ld. Counsel for the respondent that as the levy of service tax on the services in question was new one. Therefore, they were under bonafide belief and could not pay service tax. We further find that respondent has been able to satisfy their bonafides. Therefore, they are entitled to the benefit of section 80 of the Finance Act 1994 – Fit case for granting benefit under section 80 – Revenue appeal dismissed [Read less]

2015-VIL-39-CESTAT-DEL-ST|SERVICE TAX |CESTAT Cases | 23.01.2015

AHLUWALIA CONTRACTS (I) LTD Vs CCE NOIDA: 03.12.2014 - Service Tax – Work Contract – Disallowance of Composition Scheme for works contract service in respect of the composite contracts executed with effect from 1.6.2007 on the ground of that projects were ongoing contracts – Denial of benefit of 67% abatement under Notification No. 1/2006-ST on the ground that assessee had taken Cenvat credit of input services – HELD - The classification of service is to be determined in terms of the nature of service rendered vis-a-vis the definition of various services as applicable on the date of rendition of service. The Boards circular dated 4.1.2008 is in disharmony with law to the extent it holds that... [Read more]

AHLUWALIA CONTRACTS (I) LTD Vs CCE NOIDA: 03.12.2014 - Service Tax – Work Contract – Disallowance of Composition Scheme for works contract service in respect of the composite contracts executed with effect from 1.6.2007 on the ground of that projects were ongoing contracts – Denial of benefit of 67% abatement under Notification No. 1/2006-ST on the ground that assessee had taken Cenvat credit of input services – HELD - The classification of service is to be determined in terms of the nature of service rendered vis-a-vis the definition of various services as applicable on the date of rendition of service. The Boards circular dated 4.1.2008 is in disharmony with law to the extent it holds that with effect from 1.6.2007 the classification cannot be changed for ongoing projects even if the service rendered is more specifically covered there under. Thus even if the classification of service prior to 1.6.2007 in respect of ongoing contracts was under CICS/CCS, the same would be classifiable as works contract service (WCS) with effect from 1.6.2007 if the service rendered was more specifically covered there under and if the classification is held to be under WCS the benefit of Notification No. 1/2006-ST would not be applicable with effect from 1.6.2007 as the said notification is not applicable to works contract service. However, the benefit of Rule 2A of the Service Tax (Determination of Value) Rules, 2006 or any other applicable notification can be claimed by the appellants subject to producing the required evidence - As regards denial of the benefit of abatement under Notification No. 1/2006-ST on the ground that the appellants had taken Cenvat credit in respect of input services, it is to be pointed out that the said notification does not debar availment of Cenvat credit on input services – Matter remanded [Read less]

2015-VIL-32-MAD-CE|CENTRAL EXCISE |High Court Cases | 22.01.2015

M/s RAJA CROWNS AND CANS PVT LTD Vs UNION OF INDIA: 08.12.2014 - Central Excise – Goods supplied to 100% EOUs – Refund of terminal excise duty rejected based on clarification by the Policy Interpretation Committee that the supplies to EOUs are exempted from payment of Central Excise duty – HELD - In an identical set of facts, the Division Bench of the Delhi High Court in Kandoi Metal Powders Manufacturing Company Pvt Ltd Vs UoI took a decision in favour of the manufacturer - The said case arose out of a decision taken pursuant to the resolution dated 04.12.2012 which is impugned in this writ petition. Therefore, the cause of action in the case before the Delhi High Court was the impugned res... [Read more]

M/s RAJA CROWNS AND CANS PVT LTD Vs UNION OF INDIA: 08.12.2014 - Central Excise – Goods supplied to 100% EOUs – Refund of terminal excise duty rejected based on clarification by the Policy Interpretation Committee that the supplies to EOUs are exempted from payment of Central Excise duty – HELD - In an identical set of facts, the Division Bench of the Delhi High Court in Kandoi Metal Powders Manufacturing Company Pvt Ltd Vs UoI took a decision in favour of the manufacturer - The said case arose out of a decision taken pursuant to the resolution dated 04.12.2012 which is impugned in this writ petition. Therefore, the cause of action in the case before the Delhi High Court was the impugned resolution. The decision rendered by the Delhi High Court binds the respondents - Impugned order is quashed and the third respondent (JDGFT) is directed to process the refund claim in accordance with the 2009 Policy by taking into consideration the petitioner's refund application dated 16.08.2010 and pass appropriate orders in accordance with law, within a period of three months – Assessee petition allowed [Read less]

2015-VIL-33-MP-CE|CENTRAL EXCISE |High Court Cases | 22.01.2015

JAIPRAKASH ASSOCIATES LTD Vs UNION OF INDIA: 11.12.2014 - Central Excise – Recovery – Provisions of Clause 6 and 10 of a Circular dated 1.1.2013 - Recovery of the demanded amount or the assessed amount during the pendency of the appeal when a stay application is pending or after the appeal is decided as contemplated under Clauses 6 and 10 of the Circular – HELD - The petition, so far as it pertains to challenge made to the provision of Clause 6 is concerned, the same is allowed and we direct that in the case of the petitioner also, the principle laid down by Bombay High Court in Larsen & Toubro Limited Vs UoI with regard to the said Circular shall be made applicable and the petitioner shall ... [Read more]

JAIPRAKASH ASSOCIATES LTD Vs UNION OF INDIA: 11.12.2014 - Central Excise – Recovery – Provisions of Clause 6 and 10 of a Circular dated 1.1.2013 - Recovery of the demanded amount or the assessed amount during the pendency of the appeal when a stay application is pending or after the appeal is decided as contemplated under Clauses 6 and 10 of the Circular – HELD - The petition, so far as it pertains to challenge made to the provision of Clause 6 is concerned, the same is allowed and we direct that in the case of the petitioner also, the principle laid down by Bombay High Court in Larsen & Toubro Limited Vs UoI with regard to the said Circular shall be made applicable and the petitioner shall be granted the benefit of the said order - Clause 10 pertains to recovery to be initiated after orders are passed in the appeal - once the appeal is finally decided and an order is passed, the revenue is entitled to recover the amount demanded or assessed and until and unless stay is granted by a Higher Forum or Court of law, the revenue cannot be debarred from initiating action for recovery once an appeal is decided either way. There is much force in this contention and we see no reason to interfere into this part of the prayer made in the writ petition – Petition partly allowed [Read less]

2015-VIL-34-GUJ|VAT |High Court Cases | 22.01.2015

STATE OF GUJARAT Vs PREMPREET TEXTILE INDUSTRIES LTD: 09.12.2014 - Gujarat Value Added Tax Act - Whether the Tribunal has erred in deciding the appeal on merits despite the fact that the first appellate authority dismissed the appeal for failure to deposit the pre-deposit - failure to make the pre-deposit - Validity of Tribunal’s action on decided appeal on merits – HELD - The appeal before the Tribunal was directed against the order of the first appellate authority imposing certain condition of pre-deposit before entertaining the appeal on merits - The Tribunal, instead of deciding the correctness of such an order, proceeded to decide the appeal on merits and allowed it as well – Tribunal c... [Read more]

STATE OF GUJARAT Vs PREMPREET TEXTILE INDUSTRIES LTD: 09.12.2014 - Gujarat Value Added Tax Act - Whether the Tribunal has erred in deciding the appeal on merits despite the fact that the first appellate authority dismissed the appeal for failure to deposit the pre-deposit - failure to make the pre-deposit - Validity of Tribunal’s action on decided appeal on merits – HELD - The appeal before the Tribunal was directed against the order of the first appellate authority imposing certain condition of pre-deposit before entertaining the appeal on merits - The Tribunal, instead of deciding the correctness of such an order, proceeded to decide the appeal on merits and allowed it as well – Tribunal committed serious error in examining the appellants grievances on the merits of the order of assessment – the Tribunal could not have bypassed the statutory requirement of pre-deposit, unless it was waived by an order in writing – Order passed by the Gujarat Value Added Tax Tribunal is set aside and the matter is remitted to the Tribunal for fresh consideration – Revenue appeal allowed [Read less]

2015-VIL-31-MAD|VAT |High Court Cases | 22.01.2015

RAJ LUBRICANTS (M) PVT LTD Vs THE STATE OF TAMIL NADU: 03.12.2014 - Tamil Nadu General Sales Tax Act, 1959 - Whether interest collected admittedly for the belated payment of the sale price can constitute pre-sale charges to be subjected to sales tax – HELD – In the instant case the invoice itself gives an answer to the issue, as it contemplates interest on belated payment. So sale is coupled with interest on delayed payment. There is no independent agreement on interest, as rightly pointed out by the Tribunal. Moreover, Section 2(r) of the Act defines ‘turnover’ as aggregate amount for which goods are bought or sold or supplied or distributed by a dealer either directly or through another, o... [Read more]

RAJ LUBRICANTS (M) PVT LTD Vs THE STATE OF TAMIL NADU: 03.12.2014 - Tamil Nadu General Sales Tax Act, 1959 - Whether interest collected admittedly for the belated payment of the sale price can constitute pre-sale charges to be subjected to sales tax – HELD – In the instant case the invoice itself gives an answer to the issue, as it contemplates interest on belated payment. So sale is coupled with interest on delayed payment. There is no independent agreement on interest, as rightly pointed out by the Tribunal. Moreover, Section 2(r) of the Act defines ‘turnover’ as aggregate amount for which goods are bought or sold or supplied or distributed by a dealer either directly or through another, on his own account or on account of others whether for cash or for deferred payment or other valuable consideration. When the invoice of the petitioner contemplates interest on delayed payment the Tribunal was justified in including the same in the taxable turnover – Appeal dismissed [Read less]

2015-VIL-37-CESTAT-AHM-ST|SERVICE TAX |CESTAT Cases | 22.01.2015

COMMISSIONERS OF CENTRAL EXCISE, CUSTOMS & SERVICE TAX-VADODARA-II Vs SKP PROJECTS (P) LTD: 23.12.2014 - Service tax – Classification of service - ‘Consulting Engineering Service’ or ‘Survey and Map Making Service’ – Scope of work includes Route Survey, Geotechnical Investigation, Soil Investigation, Receptivity and Cadastral Survey, Geochemical Survey etc., on the basis of engineering survey work of the proposed new location, pipe line route survey work, detailed route survey, bore holes - Revenue contention is that the Director of the Company is a Diploma holder in Engineering, who rendered the service and service would come within the definition of ‘Consulting Engineering Service’ – Appea... [Read more]

COMMISSIONERS OF CENTRAL EXCISE, CUSTOMS & SERVICE TAX-VADODARA-II Vs SKP PROJECTS (P) LTD: 23.12.2014 - Service tax – Classification of service - ‘Consulting Engineering Service’ or ‘Survey and Map Making Service’ – Scope of work includes Route Survey, Geotechnical Investigation, Soil Investigation, Receptivity and Cadastral Survey, Geochemical Survey etc., on the basis of engineering survey work of the proposed new location, pipe line route survey work, detailed route survey, bore holes - Revenue contention is that the Director of the Company is a Diploma holder in Engineering, who rendered the service and service would come within the definition of ‘Consulting Engineering Service’ – Appeal relates to for the period 1999-2000 to 2003-2004 - HELD - It is contended that the term the ‘Technical Assistance’ means providing assistance on the basis of the special skills and knowledge. On the other hand, on plain reading of the definition of Survey and Map Making, we find that it covers Geological, Geophysical, or any other prospecting etc., of any kind - In the instant case, the activity relating to surveying the projects of M/s GAIL and ONGC would cover the definition of ‘Survey and Road Mapping’ – No reason to interfere findings of the Commissioner (Appeal) - Revenue appeal dismissed [Read less]

2015-VIL-36-CESTAT-BLR-ST|SERVICE TAX |CESTAT Cases | 22.01.2015

M/s INFOSYS TECHNOLOGIES LTD Vs COMMISSIONER OF SERVICE TAX, BANGALORE: 12.01.2015 - Export of service - Refund of accumulated input service credit – Denial of refund on the ground assessee has not produced any documentary evidence showing the usage of the input services in the output service exported and not fulfilled the conditions of the Export of Service Rules, 2005 - As seen from the above, the appellate authority has decided in favour of the assessee as far as the legal issue is involved. He has simpliciter directed to lower authority to examine the documents for the purpose of grant of refund of accumulated credit. As such, the appellant cannot be held to be aggrieved with the order –... [Read more]

M/s INFOSYS TECHNOLOGIES LTD Vs COMMISSIONER OF SERVICE TAX, BANGALORE: 12.01.2015 - Export of service - Refund of accumulated input service credit – Denial of refund on the ground assessee has not produced any documentary evidence showing the usage of the input services in the output service exported and not fulfilled the conditions of the Export of Service Rules, 2005 - As seen from the above, the appellate authority has decided in favour of the assessee as far as the legal issue is involved. He has simpliciter directed to lower authority to examine the documents for the purpose of grant of refund of accumulated credit. As such, the appellant cannot be held to be aggrieved with the order – Assessee appeal dismissed [Read less]

2015-VIL-35-CESTAT-CHE-CE|CENTRAL EXCISE |CESTAT Cases | 21.01.2015

COMMISSIONER OF CENTRAL EXCISE, CHENNAI-II Vs TULSYAN NEC LTD: 19.01.2015 - Central Excise - Input credit on furnace oil and oxygen as fuel used in the manufacture and clearance of exempted product - Period involved April 2002 to March 2005 – HELD - The present case is only on the credit availed on fuel used in the exempted product. The issue has already been settled by various High Courts and the Tribunal - Assessee is eligible to avail credit – Revenue appeal dismissed

2015-VIL-34-CESTAT-AHM-CE|CENTRAL EXCISE |CESTAT Cases | 21.01.2015

M/s UNIMED TECHNOLOGIES LTD Vs COMMISSIONER OF CENTRAL EXCISE & S.T., SURAT: 15.01.2015 - Cenvat Credit Rules, 2002 – Use of common inputs in the manufacture of dutiable and exempted products - Demand of 8% of the sale value of the exempted goods as the appellant had not followed the procedure as prescribed under Rule 6 of the Cenvat Credit Rules, 2002 – Discharge of duty amount by equivalent to CENVAT credit - HELD – HELD - Issue is covered by amendment of Rule 6 of Cenvat Credit Rules, 2002 with retrospective effect in Finance Act, 2010 – Impugned order set aside and appeal is allowed