Bharat Shemlani
Chartered Accountant

1.1 S. Maruthppan vs. CCE, Tirunelveli, 2007 (8) STR 228 (Tri-Chennai)

The appellant in this case received amount as retainer allowance for supervising electrical work. He has contended that being Diploma holder only, he is not covered under Consulting Engineers category. The Tribunal held that basic requirement of transaction between a ‘service provider’ and ‘service receiver’ on principal to principal basis is not satisfied and therefore the order demanding service tax on retainer fees is to be set aside.

1.2 Sangamitra Services Agency vs. CCE, Chennai, 2007 (8) STR 233 (Tri-Chennai)

In this case the appellant has paid service tax on remuneration received from principal excluding reimbursement of expenses on actual basis. The department sought to tax reimbursement of expenses. The Tribunal held that charges reimbursed to appellants by principal towards freight, labour, electricity, telephone etc. on actual basis not to be included in taxable value of C & F services.

1.3 Velji P. & Sons (Agencies) P. Ltd. vs. CCE, Bhavnagar, 2007 (8) STR 236 (Tri-Ahmd.)

In this case, the Tribunal held as under:

• Activities of handling, stevedoring, loading, unloading, tug hire and labour arrangement do not fall under category of Port services. Such services are not being required by the port, any authorization by port cannot convert such services into Port services.

• Licence issued by port to various agencies should not be confused with authorization. Licence means a permission given for specific purpose. Licence holder not to be interpreted as having powers or authority of the person issuing licence, unless the licence specifically mentions about it. Authorization may be issued by way of licence, but not all licences are authorizations.

• There was confusion about the scope of Port services amongst assessees and departmental officers hence there was no mala fide intention on the part of the appellant and no suppression or misstatement with a intent to evade duty can be attributed to the appellant and therefore the extended period of limitation cannot be invoked.

1.4 Ispat Industries Limited vs. CCE, Raigad, 2007 (8) STR 282 (Tri-Mumbai)

The Tribunal in this case held as under:

• The department failed to discharge the burden of proving that firms in Germany and USA were engineering firms, which is a pre-requisite for levying service tax on Consulting Engineer services.

• The service tax is leviable on person who is a non-resident or is from outside India w.e.f. 1-1-2005, hence the appellant is not liable to pay service tax as the period involved in appeal was prior to 1-1-2005.

• Transfer of technical know-how is not covered under the category of Consulting engineer service.

1.5 CCE, Ludhiana vs. Dr. Lal Path Lab (P) Ltd. 2007 (8) STR 337 (P&H)

The appellant in this case was engaged in the activity of collection centre with facilities and trained employees for drawal of blood samples and to carry out essential processing (serum separation) of blood and forwarding samples to the principal lab through courier. The Hon’ble High Court held that since any testing or analysis services provided in relation to human being or animal is not liable to service tax under Technical Testing and Analysis services, the activities of appellant cannot be taxed under Business Auxiliary service.

1.6 Pandit Motor Service vs. CCE, Jaipur 2007 (8) STR 344 (Tri-Del)

The Tribunal in this case held as follows:

• Any vehicle that plies on the road cannot be sought for permission as ‘tourist vehicle’ and in order to be eligible for such a permit the vehicle has to fulfil certain basic requirements specified in Motor Vehicles Acts/Rules.

• Once the concerned authorities have permitted the appellant for using a particular vehicle as a ‘tourist vehicle’ having verified the various parameters, such a vehicle by virtue of its being used otherwise cannot be declassified and treated as a ‘non-tourist vehicle’.

• Once the specifications make a particular vehicle eligible to be a ‘tourist vehicle’ and further an authority endorses such a classification, how the same is put to us by permit holder would not materially change the position under law.

1.7 Tata Technologies Limited vs. CCE, Pune-I 2007 (8) STR 358 (Tri-Mumbai)

The appellant in this case was acting as agent for Software Company and enabling its group companies to procure software and its maintenance. They have received amount of software and also annual maintenance from affiliates and paid the same to Software Company. The Tribunal on the facts of the case held that activities of agent as carried out by the appellant cannot be treated as Management Consultants services.

1.8 South East Corporation vs. CCCE & ST, Kochi 2007 (8) STR 405 (Tri-Bang.)

The appellant was engaged in the activity of marketing and distribution of Sim cards. They have purchased Sim cards from Principal on full value, on which Principal has already paid service tax. The Tribunal held that the activity of appellant is an activity of marketing and distribution of products for which certain amount of profit received and such activity which is purchase and sale of goods is not liable to service tax under Business Auxiliary Service.

1.9 Schott Glass India (P) Ltd. vs. CCE Vadodara-II 2007 (8) STR 407 (Tri-Ahmd.)

The appellant in this case received Consulting engineers services from their sisters concerns located in Germany during the period November, 2001 to March 2002, however bill for same was received subsequently in the year 2003 and payments made thereafter. The Tribunal in this case held that when services were received, there was no provision for payment of service tax by recipient of service from foreign company. Merely because payment for such services was raised and settled in September 2003, the same cannot be the ground to demand tax on such services.

2.1 CST, Ahmedabad vs. Pepsi Cola India Marketing Co. 2007 (8) STR 246 (Tri-Ahmd.)

The Tribunal in this case after relying on Supreme Court decision in Commissioner of Trade Tax vs. Kanhai Ram Thekedar 2005 (185) ELT 3 (SC) held that, no demand notice or written notice is required to be issued for confirmation of interest which is a liability accruing as a consequence of payment.

2.2 CCEC, BBSR-II vs. Gupta Steels Pvt. Ltd. 2007 (8) STR 248 (Tri-Kolkata)

In this case, a Commissioner holding charges of two Commissioners constituted committee to form an opinion on the legality and propriety of Commissioner (Appeals) Order. The Tribunal held that, the legal requirement under CEA, 1944 is that a Committee of two Commissioners can only decide the issue and subsequent authorization to file an appeal on behalf of Committee. Since in this case only one Commissioner has given the authorization, the same is invalid.

2.3 Indore Malwa United Mills Ltd. vs. CCE, Indore 2007 (8) STR 273 (Tri-Del.)

The Tribunal in this case held that interest on refund of pre-deposit will be calculated from the date of last order. In the present case, since no appeal was filed against Commissioner (Appeals) order the same has been reached to finality and therefore interest is payable from the date of order in appeal.

2.4 Bohra Pratishtan Pvt. Ltd. vs. CCE, Jaipur 2007 (8) STR 278 (Tri-Del.)

In this case the appellant paid service tax liability along with interest on 14-1-2004 and 23-2-2004 and pleaded for the benefit of Extraordinary Tax Payer Friendly Scheme. The Tribunal held that since the amounts have been paid before 30-10-2004 the appellant is covered by the Amnesty scheme and set aside the penalty levied under sections 76 and 77.

2.5 CCE, Nashik vs. P. M. Pol 2007 (8) STR 303 (Tri-Mumbai)

In this case the assessee paid service tax with interest before issue of SCN. SCN was issued when Extraordinary Taxpayers Friendly Scheme was in force. The Tribunal held that issue of SCN when the Amnesty Scheme was in force, has given rise to cause of action for claiming benefit of amnesty scheme and hence upheld the appeal order, which granted the benefit of amnesty scheme.

2.6 Jayswals Neco Ltd. vs. CCE, Nagpur 2007 (8) STR 305 (SC)

The Supreme Court in this case held inter alia as under:

• Once the department having accepted principles laid down in earlier case, they cannot be permitted to take a contra stand in subsequent cases.

• Bench of co-ordinate jurisdiction must not disregard decision of same strength on its own on an identical question. If Bench of co-ordinate jurisdiction does not agree with a Bench of same strength, then it should refer the matter to a Larger Bench and refrain from taking upon itself not to follow such decision and take a contra view.

• Classification of goods adopted in earlier decisions must not be lightly disregarded in subsequent decisions, lest such judicial inconsistency shake public confidence in administration of justice.

2.7 Hindustan Lever Ltd. vs. CCE, Chennai IV 2007 (8) STR 308 (Tri- Mumbai)

The Tribunal in this case held as under:

• Service of orders, summons, notices etc. should be served only in modes and manner prescribed in section 37C(1)(a) of CEA, 1944.

• In case of orders, summons, notices etc. sent by ordinary/certificate of post, presumption of service under section 114 of Indian Evidence Act, 1872 is not available under section 37C(1)(a) of CEA, 1944.

• As the order was not sent by registered post acknowledgement – due, its date of service was the date of its receipt on payment of requisite fees by the appellant.

2.8 Indian Aluminum Co. Ltd. vs. CCE, Kochi 2007 (8) STR 433 (Tri-Bang.)

The Tribunal in this case held that amount of refund cannot be appropriated towards appellant’s another liability of pre-deposit under section 35F of CEA, 1944 in another appeal relating to another demand.