Bharat Shemlani
Chartered Accountant
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Services
1.1 Matrix Laboratories Ltd. vs. CCEC,
Hyderabad-II 2008 (9) STR 15 (Tri-Bang.)
In this case, the Tribunal held that sale of
Technical Know-how for manufacture of Active Pharmaceutical
Ingredients on receipt of consideration is sale of technology.
Technology is sold with all rights and technical documentations
without holding any rights, therefore not liable to service tax
under Scientific or Technical Consultancy.
1.2 Indus Motor Company vs. CCE, Kochi 2008
(9) STR 18 (Tri-Bang.)
In this case, the adjudicating authority held
that cost of free service provided by the appellant being
Authorized Service Station is hidden in cost of vehicles sold. The
Tribunal held that when a service is rendered free of charge,
unless Revenue shows some evidence that the appellant got
reimbursement from manufacturer in some other guise, it will not
be possible to confirm the demand. The demand cannot be based on
assumptions and presumptions.
1.3 Nexus Computers (P) Ltd. vs. CCE,
Pondicherry 2008(9) STR 34 (Tri-Chennai)
The department in this case by invoking
extended period of limitation, demanded service tax from appellant
under C & F Agent’s service, Business Auxiliary service and
Consulting Engineers service at different point of time. The
Tribunal held that department was not consistent in their approach
by taking different views at different point of time as regard the
nature of services rendered by the appellant during the material
period. The departmental authorities landed the appellant in total
chaos and confusion. In view of this the department is not
entitled to allege that appellant did anything or omitted to do
anything with intent to evade payment of service. Show Cause
Notice was issued without satisfying requirement for invoking
extended period of limitation under proviso to section 73(1) (a).
1.4 Edman Imaging (P) Ltd. vs. CST, Kochi
2008 (9) STR 91 (Tri-Bang.)
The Tribunal after relying on decision in
Adlabs vs. Commissioner 2006 (2) STR 121 (T) and CBEC Circular No.
59/8/2003 dated 20-6-2003, held that exemption to material
consumed during the provision of photography service is admissible
under Notification No. 12/2003-ST. The records maintained by the
assessee in this regard to be accepted and the notification does
not provide for any mention about use of input in invoice to claim
benefit of notification.
1.5 Kerala Publicity Bureau vs. CCE 2008(9)
STR 101 (Tri-Bang.)
The appellant in this case an advertising
agency received incentives from Media. The department considered
these receipts as extra commission and proceeded to levy service
tax under Advertising Agents service by invoking extended period
of limitation. The Tribunal held that incentives in the form of
discounts are not leviable to service tax and only charges
received towards advertising services are liable. Since amounts in
dispute are not received by appellant in relation to service
provided to their clients, demand and penalty not sustainable.
1.6 CCE, Raigad vs. Indian Oil Tanking Ltd.
2008 (9) STR 147 (Tri-Mum.)
In this case the assessee has undertaken works
contract on turnkey basis, where the value of various services
were indicated separately in the contract. The Tribunal observed
that there are conflicting decisions of Tribunal on leviability of
service tax on such kind of contracts/transactions, hence directed
the registry to place the matter before Larger Bench.
1.7 Ganesh Maniyani vs. CCE, Mangalore 2008
(9) STR 152 (Tri-Bang.)
In this case, appellant was engaged on
transportation of newspapers and received payment based on trips
made by the vehicles. The department sought to tax him under
Rent-a-cab Operator’s service. The Tribunal after relying on
decision in Kuldip Singh Gill 2006 (3) STR 689 (T) held that where
amounts are received for each trip based on distance, the said
trips are not covered under Rent-a-Cab Operators service.
1.8 CCE, Siliguri vs. Mahabir International
2008 (9) STR 162 (Tri-Kol.)
The assessee, a charitable trust conducted Yoga
Shibir. The department sought to tax them under Event Management
Service. The Tribunal held that no evidence was brought on record
by the department that assessee carried out commercial activity
and realized money hence the assessee cannot be taxed arbitrarily
on sale of tickets of Shibir.
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Interest/Penalties/Others
2.1 Kerala State Electricity Board vs. CCE,
Thiruvananthapuram 2008 (9) STR 3 (SC)
In this case, the Hon’ble Supreme Court held
that appellant being liable to service tax on import of services
under reverse charge mechanism is also liable to pay interest on
default in payment of tax. The liability to tax being that of
appellant, it must accept the liability of payment of interest
leviable thereupon in terms of statute occasioned by breach on its
part to deposit the amount of tax within the prescribed time.
2.2 CCE, Chennai vs. Dinesh Chandra Papers
(P) Ltd. 2008 (9) STR 3 (SC)
In this case the order was accepted by the
Committee of Commissioners and appeal against the said order was
not filed. The Commissioner on coming across some judgment filed
appeal against the said order subsequently. The Tribunal held that
review by Commissioner on his own accord is without jurisdiction,
the order is final as the same is accepted by the Revenue hence
appeal is not maintainable.
2.3 Karnataka State Agro Corn Products Ltd.
vs. CCE, Bangalore 2008 (9) STR 93 (Tri- Bang.)
The Tribunal in this case held that Interest on
refund is always with reference to date of application for refund
and not with reference to an order granting refund. Since the
provision for grant of interest came into effect only in 1995, the
date of payment of interest will start after expiry of three
months from the date on which Finance Bill, 1995 received assent
of President i.e., 26-5-1995 till the date of payment of refund
amount.
2.4 CST, Mumbai vs. S. R. Enterprises 2008
(9) STR 123 (Bom)
In this case, the Hon’ble High Court held that
CESTAT is empowered to reduce penalty as per statutory provisions
and the Court may not interfere with exercise of discretion by
CESTAT unless the power is exercised arbitrarily by Tribunal.
Reduction in penalty by CESTAT considering facts and circumstances
is sustainable and no question of law arises.
2.5 Jindal Praxair Oxygen Co. Pvt. Ltd. vs.
CCCE, Belgaum 2008 (9) STR 135 (Tri-Bang.)
The appellant in this case paid service tax on
Research & Development Cess without availing exemption under
notification No. 18/2002-ST. Subsequently they filed refund claim
for excess service tax paid. The department rejected refund on the
ground that appellant violated R&D Cess Act, 1986 as Cess was paid
subsequent to payment for transfer of technology. The Tribunal
held that delay in payment of R&D Cess is not a ground for denying
exemption under the said notification and the appellant is
entitled for refund of excess service tax paid.
2.6 Inox Air Products Ltd. vs. CCE
(Appeals), Nagpur 2008 (9) STR 163 (Tri-Mum.)
The Tribunal in this case held that since
section 35B of CEA, 1944 are not applicable to Service Tax, appeal
involving disputed amount below Rs. 50,000/- is maintainable.
2.7 CCE, Thane-I vs. Herbert Browns P&R
Laboratory 2008 (9) STR 177 (Tri-Mum.)
The assessee in this case paid service tax
under protest on scientific and technical services for the period
1999-2000 under the category Consulting Engineers Service. The
Tribunal held that Scientific or Technical consultancy services
are liable to service tax w.e.f. 16-7-2001, hence tax paid prior
to that date is refundable under section 11B.
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CENVAT Credit
3.1 Microstar Computers vs. CCE, Vapi 2008
(9) STR 22 (Tri-Ahmd.)
In the present case, the appellant was forced
by departmental authorities to pay duty from PLA in spite of
sufficient balance in Cenvat credit account as a part of year end
revenue mobilization efforts. The goods manufactured by appellant
subsequently exempted from duty and therefore they could not
utilize the Cenvat credit. They have applied for cash refund of
unutilized credit. The Tribunal after relying on Gauri
Plasticulture Pvt. Ltd. vs. Commissioner 2006 (202) ELT 199 (T-LB)
held that payment of fixed amount from PLA indicates compulsion
from department and therefore refund is admissible in cash or by
way of credit entry in PLA.
3.2 Ambattur Petrochem Ltd. vs. CCE, Raipur
2008 (9) STR 53 (Tri-Del.)
The Tribunal in this case observed that payment
of service tax is a specifically authorized item in regard to
service tax credit. The finding that since appellant is
manufacturer of excisable goods they cannot be treated as provider
of output service is not sustainable. In view of thereof it is
held that service tax credit can be utilized for payment of
service tax in relation to tax payable on transportation service.
3.3 CCEC vs. Purity Flexpack Ltd. 2008 (9)
STR 125 (Guj.)
In this case the supplier of assessee paid duty
on input @ 24% instead of 16%. The question arose before the Court
was whether the assessee is entitled to claim Cenvat Credit at
higher rate of duty paid. The Tribunal held that duty payment at
higher rate was not disputed by the Department at suppliers end
and hence credit taken by assessee not to be disallowed. The Court
confirmed the Tribunal’s order and held that credit is available
of duty paid at higher rate.
3.4 Soudararaja Mills Ltd. ‘E’ Mills vs.
CCE, Madurai 2008 (9) STR 183 (Tri-Chennai)
The appellant in this case was receiving
taxable services of GTA and discharging service tax liability in
respect thereof from Cenvat credit availed on inputs, capital
goods etc. The department objected for such adjustment. The Tribunal
held that GTA service on which the appellant paid service tax is
deemed to be appellant’s output service and therefore such
adjustment against Cenvat credit for payment of service tax on GTA
is admissible.
