GOODS AND SERVICE TAX REPORTS (GSTR) Volume 21 Part 5 (Issue dated 29-7-2013)

GOODS AND SERVICE TAX REPORTS (GSTR)

Volume 21 Part 5 (Issue dated 29-7-2013)

SUBJECT INDEX TO CASES REPORTED IN THIS PART

HIGH COURTS

Customs duty --Writ petition--Maintainability--Misdeclaration of goods--Show-cause notice--Whether imported goods steam coal or bituminous coal--Is question of fact--To be agitated in proceedings pursuant to show-cause notice--No plea of inherent lack of jurisdiction or violation of principles of natural justice by adjudicating authority--No interference called for at stage of show-cause notice--Petition dismissed--Customs Act, 1962--Constitution of India, art. 226-- Binani Cement Ltd. v. Union of India (Guj) . . . 383

Excise duty --Appeal to Appellate Tribunal--Appeal by Department--Limitation--Order directing filing of appeal to be passed within one year from date of adjudication--No proof to show that Board passed order within one year--Appeal filed before Tribunal barred by limitation--Central Excise Act, 1944, s. 35E(3)-- CCE v. Millipore (I) P. Ltd. (Karn) . . . 398

----Appeal--Appeal to Appellate Tribunal--Delay in filing appeal--Condonation of delay--No proof of service of copy of order on day of pronouncement of order in November 2003--Contention that knowledge of order in month of January 2005 to be accepted--Sufficient explanation for condonation of delay--Delay condoned--Central Excise Act, 1944, s. 35G-- Saraya Sugar Mills Ltd. v. CCE (All) . . . 392

----Penalty--Non-payment of differential duty--Failure to pay differential duty on ground of permanent closure of unit--Penalty not leviable--Appellate authority and Tribunal erring in reducing penalty--Assessee not preferring appeal to High Court--Relief cannot be granted--Central Excise Rules, 1944, r. 96ZP(3)-- Commissioner of Customs and Central Excise v. Corrufab P. Ltd. (All) . . . 388

----Recovery of duty--Show-cause notice--Extended period of limitation--Notice issued alleging that marketing pattern not disclosed by assessee--Earlier decision rendered in case of company belonging to assessee's group with similar allegations--Finding that Department aware of marketing pattern of assessee--Finding of fact--Show-cause notice issued beyond normal period barred by limitation--Central Excise Act, 1944, s. 11A-- CCE v. Polar Industries Ltd. (All) . . . 395



CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL

Customs duty --Classification of goods--Opinion of chemical testing laboratories--Only as to chemical composition of product and not regarding classification of product--Gas condensate imported whether "refined petroleum product" or "crude petroleum oil"--Existence of competing customs tariff headings for goods of similar chemical composition--Classification to be decided under rule 3(c)--Failure to establish natural origin of gas condensate--Goods classifiable under Customs Tariff Heading 2710--Customs Tariff Act, 1975, Sch. I, General Rules of Interpretation, r. 3--Customs Tariff Act, 1975, Headings 2709, 2710-- Paswara Impex Ltd. v. Commissioner of Customs (Ahd) . . . 329

----Customs house agent--Forfeiture of security--Failure by importers to re-export goods within six months--No proof that agent acted mala fide--Action taken against agent without sufficient cause--Order set aside--Customs House Agents Licensing Regulations, 2004, regln. 13(a), (d)-- Natvar Parikh and Co. P. Ltd. v. Commissioner of Customs (Chennai) . . . 367

----Imported goods--Assessable value--"Condensate"--Gas condensates not standard products with composition varying from source to source--No proof that value repatriated in addition to transaction value paid to supplier of goods and chemical test reports not made available--Contemporary imports relied on to reject transaction value and enhance assessable value not proper--Customs Act, 1962-- Paswara Impex Ltd. v. Commissioner of Customs (Ahd) . . . 329

----Improper export--Penalty--Actual exporter different from company in whose name red sanders exported--Absence of evidence establishing involvement of company in smuggling of red sanders and neither show-cause notice nor order alleging omission and commission on its part--Responsibility cannot be passed on company for misuse of its import-export code by actual exporter--Order imposing penalty set aside--Customs Act, 1962, s. 114-- Marvelous Engineers P. Ltd. v. Commissioner of Customs (Export) (Mumbai) . . . 370

----Improper export--Penalty--Customs house agent--Omission to ascertain genuineness of transaction--Imposition of penalty sustainable--Quantum of penalty to be commensurate with gravity of offence--Customs house agent having no knowledge about goods under export and not actively participating in facilitating illegal transaction--Nominal and reasonable penalty to be imposed--Penalty reduced--Customs house agent owning responsibility for omission--No need to impose separate penalty on its employee--Customs Act, 1962, s. 114--Customs House Agents Licensing Regulations, 2004-- Marvelous Engineers P. Ltd. v. Commissioner of Customs (Export) (Mumbai) . . . 370

----Improper export--Penalty--Freight forwarder--Freight forwarder undertaking transaction based on e-mail received but failing to verify actual existence of company in whose name goods exported--Export documents received from fictitious company in respect of seven transactions and container provided by it misused for smuggling prohibited goods--Amounts to omission--Liable to penalty--No deliberate involvement in smuggling prohibited goods--Penalty to be reduced--Separate penalty imposed on its director, set aside--Customs Act, 1962, s. 114-- Marvelous Engineers P. Ltd. v. Commissioner of Customs (Export) (Mumbai) . . . 370

----Misdeclaration of goods--Confiscation and penalty--Assessees having knowledge that goods were good quality petroleum oil classifiable under Customs Tariff Heading 2710 19 90 but misdeclaring as crude oil condensate--Confiscation and imposition of penalty proper--Penalty restricted to differential duty sought to be evaded--Customs Act, 1962, s. 111(a)-- Paswara Impex Ltd. v. Commissioner of Customs (Ahd) . . . 329

Excise duty --Assessable value of goods--Installation and testing charges to form part of assessable value--No proof of separability of contract for exclusion of installation and testing charges in assessable value of goods supplied--Imposition of penalty and charging of interest, proper--Central Excise Act, 1944, s. 11AC-- Sukalp Agencies v. CCE (Delhi) . . . 350

----Cenvat credit--Wrongful availment of credit--Conclusion of adjudication by summary order without thorough analysis of composition of different inputs for each year--Reasoned and speaking order warranted--Matter remanded--Central Excise Act, 1944-- Satyam Industries v. CCE (Delhi) . . . 364

----Clandestine removal of goods--Penalty--Goods removed against invoice of previous year without depositing duty before detection by investigation--Immunity from penalty cannot be granted--Demand of duty and imposition of penalty proper--Direction to verify deposit if already made and appropriate that amount against demand and recovery of short fall--Central Excise Act, 1944, s. 11AC-- Sukalp Agencies v. CCE (Delhi) . . . 350

----Clandestine removal of goods--Penalty--Interest--Allegation of overlapping of demand of duty--No proof to controvert allegation as baseless--Demand of duty reduced--Assessee not exonerated from payment of interest and penal consequences--Interest payable from date of removal of goods till date of reversal by debit entry--Motive of removal attributable to mala fides--Imposition of penalty confirmed--Central Excise Act, 1944-- Sukalp Agencies v. CCE (Delhi) . . . 350

----Clandestine removal of goods--Penalty--Interest--Goods cleared without being entered in statutory record and without excise invoice--Breach deliberate--Demand of duty confirmed--Authority to appropriate deposit and calculate interest payable--Penalty imposed confirmed--Central Excise Act, 1944-- Sukalp Agencies v. CCE (Delhi) . . . 350

----Compounded levy scheme--Rebate of duty--Interest on delayed payment--No distinction under section 11B regarding duty charged under section 3 or 3A--Excess amount to be refunded subject to section 11B--Commissioner competent authority to sanction rebate and not Assistant/Deputy Commissioner--Claim applications sanctioned belatedly by Commissioner to be treated as applications for refund--Assessee eligible for interest from date of application for refund and from date of claim for interest consequent to sanction of refund--Central Excise Act, 1944, ss. 3, 3A, 11B--Central Excise Rules, 1944, r. 96ZQ(7)-- Janson Textile Processors v. CCE (Chennai) . . . 345

----Evasion of duty--Penalty--Contumacious conduct and oblique motive of representative of assessee established--Proof of mass-scale evasion of duty on different counts--Imposition of penalty, proper but reduced to Rs. 1 lakh--Authorised signatory of assessee's knowledge attributable to evasion--But absence of pre-meditated mind to cause evasion--Penalty imposed reduced to Rs. 10,000--Central Excise Act, 1944, s. 11AC-- Sukalp Agencies v. CCE (Delhi) . . . 350

----Exemption--Small-scale industrial unit--No proof of exemption claimed deliberately to cause prejudice to Department--Difficulty in interpretation of exemption notification--Imposition of penalty not sustainable--Central Excise Act, 1944, s. 11AC-- Sukalp Agencies v. CCE (Delhi) . . . 350

----Short-payment of duty--Sale value of finished goods higher than assessable value causing short-levy of duty--Assessee claiming to carry on two different activities of trading and manufacturing--Failure to find out existence of two activities--Law cannot be applied whimsically or capriciously--Matter remanded--Central Excise Act, 1944-- Sukalp Agencies v. CCE (Delhi) . . . 350

Service tax --Cenvat credit--Input service--Admissibility of credit claimed--Connection between service claimed as input service with manufacture/output service--Enquiry by adjudicating authority from service provider--Scope of--On facts matter remitted to adjudicating authority--Cenvat Credit Rules, 2004-- Hero Motocorp Ltd. v. CCE (Delhi) . . . 360