DIRECT TAXES - Service Tax

Sunil M. Lala

A] CLASSIFICATION OF SERVICE

Banking & Other Financial Service:

1. In this case, the appellant challenged levy of service tax on chit funds after deletion of exclusion to cash management. The Hon’ble High Court has held that as there is no specific statutory definition of ‘cash management’ or ‘asset management, in the statute and wider interpretation to include or exclude transactions did not arise. There was no policy decision or statutory legislative Act to levy service tax on chit funds. CBEC Circular No. 97/7/2007-ST dated 23-8-2007 clarify that Service tax was leviable on chit funds was required to be set aside as statutory definition to cover chit funds is absent in statute.

A.P. Federation of Chit Funds vs. UOI 2009 (13) STR 350 (AP)

Broadcasting Service:

2. In this case, the appellant had prepared schedules and decided programmes to be telecasted and collected money for sale of time slots to advertisers and sponsors. The Tribunal held that, appellant was covered under ‘broadcasting agency or organization’. Since the provision of slot sale agreement between appellant and broadcasting company was within the knowledge of the department, demand relating to extended period is required to be set aside.

Vijay Television (P) Ltd. vs. CST, Chennai 2009 (13) STR 296 (Tri-Chennai)

Business Auxiliary Service:

3. The assessee was managing dharmakanta and issuing weighment slips for weighing goods. The Tribunal held that assessee was not concerned with sale or marketing of goods and was also not provider of incidental or auxiliary service to any sale promotion or sale of goods, hence not covered under Business Auxiliary service.

CCE, Chandigarh vs. Deepak Computers 2008 (12) STR 569 (Tri-Del.)

4. The Tribunal in the case has held that the activity of sale and purchase of mutual fund units did not fall under clause (ii) and (iv) of section 65 (19) defining Business Auxiliary service as said clauses refer to ‘services’. Mutual fund units being goods as per definition under section 65(50) r.w.s. 2(7) of Sale of Goods Act, 1930 and therefore entitled for exemption under Notification No. 13/2003-ST.

CST, Delhi vs. P. N. Vijay Financial Services Pvt. Ltd. 2008 (12) STR 628 (Tri-Del.)

C&F Agent Service:

5. The assessee in the agreement executed indicated that the assessee were not the owners of goods and not entitled to sell the goods on their own. Sale of goods took place at a price fixed by the principal and on behalf of principal. Goods also delivered to customer on behalf of principal. The Tribunal held that consignment agent is specifically included under C&F Agent service and therefore, had upheld the original order confirming demand of service tax.

CCE, Ludhiana vs. Singhania Chemical Agency, 2009 (13) STR 160 (Tri-Del.)

Cargo Handling Services:

6. The Tribunal in the case held that main purpose of contract was that of breaking and crushing of limestone boulders into jelly and loading and unloading boulders and jelly was only incidental to mining activity. The essential characteristics of work were not that of ‘cargo handling service’ but that of breaking and crushing of limestone and its transportation.

N. Rajashekar & Co. vs. CCE, Mysore 2008 (12) STR 760 (Tri-Bang.)

7. The Tribunal held that letting out pay loader was not primary object of contract but pay loader was used as aid to perform service of loading of cargo. It was further held that, taxable event arouse when service relating to or in relation to handling of cargo was provided by a cargo handling agency irrespective of mode of transport used for movement of such cargo. Since intention to evade tax was absent as confusion prevalent during the infancy stage for implementation of law, penalties was set aside.

Gajanand Agarwal vs. CCE, BBSR, 2009 (13) STR 138 (Tri-Kolkata)

Commercial Training & Coaching Centre Service:

8. The appellant, a non-profit society registered under the State Societies Registration Act imparts education and awards degrees/diplomas recognized by the law. Service tax was demanded under ‘Commercial Training and Coaching Service’. It was held that the appellant were imparting higher education and conferred degrees recognised by law and had recognition from various State Governments and UGC and as such, these services provided by institutions registered under the Societies Registration Act for educational purposes were outside the purview of the definition of commercial coaching.

ICFAI vs. CC & CE, Hyderabad-II, (2008) 17 STT 501 (Bang.-CESTAT)

9. The Tribunal in the case observed that online computer courses had all the features of traditional computer classes with difference of medium only and held that the said activity could not be restricted to providing online access to data or information. The essential character of service provided was online training or coaching centre. CBEC circular had clarified that correspondence courses was covered under Commercial Training or Coaching Centre service and hence, impugned courses through internet were also covered under Commercial Training or Coaching Centre service. It was further held that Revenue had to prove liability on particular person, if they sought to impose service tax on such person.

Dewsoft Overseas Pvt. Ltd. vs. CST, New Delhi 2008 (12) STR 730 (Tri-Del.)

Consulting Engineering Services:

10. The Tribunal held that, supervision of installation and commissioning of plant or construction was not covered under Consulting Engineers service. It was further held that, department was aware of activity undertaken by appellant while issuing first SCN and the appellant being a registered unit with Central Excise Department and clearing goods on payment of excise duty, the extended period of limitation could not be invoked.

Kilburn Engg. Ltd. vs. CCE, Vadodara-II 2009 (13) STR 285 (Tri-Ahmd.)

Mining Services:

11. Tribunal in this case held that washing of coal (beneficiation) was an integral part of mining activity. This activity did not amount to production of coal because beneficiation was a process which enhances quality of coal. Washing of coal was liable to service tax w.e.f. 1-6-2007 under Mining Service.

Energy (P) Ltd. vs. CC&CE, Hyderabad-I 2009 (13) STR 42 (Tri-Bang.)

Port Services:

12. The appellant had undertaken ship repair in dry dock under agreement with Port. The Tribunal held that the issue was settled in Homa Engineering Case 2007 (7) STR 546 (T), wherein it was held that ship repair service was not covered under Port service and hence no demand was sustainable under Port service.

Western India Shipyard Ltd. vs. CCST, Goa 2008 (12) STR 550 (Tri-Mumbai)

13. According to the Tribunal, cargo handling services i.e., loading and unloading of cargo when performed within territorial limits of minor and major ports qualify to be ‘port services’. Port service could be performed from premises only if authorised by major port or minor port authorities and therefore stevedoring operations performed from port premises were port services. However, considering the importance of the issue and disagreement made with the decision in the abovementioned cases, the matter was referred to the Larger Bench.

Western Agencies Pvt. Ltd. v. Commissioner of Service Tax, Chennai, 2008 (12) STR 739 (Tri-Chennai)

Residential Complex Service:

14. The Tribunal in the case held that in order to attract liability under Construction of Residential Complex service the residential complex should comprise more than 12 units to attract service tax liability. The legislative intention was not to levy service tax on construction of individual residential units but to tax construction of new residential complex or part thereof. It was further held that such activity was also not covered under Works Contract service.

Macro Marvel Projects Ltd vs. CST, Chennai 2008 (12) STR 603 (Tri-Chennai)

15. In this case, the appellant engaged in construction of residential flats, entered into tripartite agreement indicating themselves as first party acting as actual developer of residential complex, second party being flat purchaser and third party being land owner. The Tribunal held that appellant had rendered construction of residential complex service. However, since service tax had been paid with interest before issue of SCN and there was doubt about liability and interpretation of provision, therefore, the Tribunal set aside the penalty.

Rohan Builders Ltd. vs. CST, Bangalore, 2009 (13) STR 56 (Tri-Bang.)

Tour Operators:

16. In this case, the appellant was having contract carriage permit and deployed vehicles with various manufacturers for carrying employees of factory. The Tribunal held that, in view of Madras High Court decision in Secretary Federation of Bus Operators Assn. of Tamil Nadu 2006 (2) STR 411 (Mad), appellant was not having tourist permit and hence not liable to service tax as provider of tour operator service.

Bhagwan Singh Gulati vs. CCE, Bhopal 2009 (13) STR 253 (Tri-Del.)

Stock Broker’s Services:

17. In this case, the Tribunal held that decision in Vijay Sharma & Co. 2007 (7) STR 518 (Tribunal) holding levy only on main stock broker for the period prior to 10-9-2004 is per incurium and rendered overlooking the term ‘in connection with’. The expression ‘in connection with’ expands the scope of service and includes any service in connection with sale and purchase of securities. Arranging prospective investor by registered sub-broker for sale or purchase of securities from stock broker was covered and liable to service tax even prior to 10-9-2004.

Unique Investment Centre vs. CCE, Chandigarh, 2009 (13) STR 158 (Tri-Del.)

Works Contract:

18. The Tribunal held that dominant nature test is not applicable for works contract falling under clause (b) of Article 366(29A) of Constitution of India. Turnkey contract could be treated differently, when works contract could be split into sale contract and service contract. Tribunal’s decision in Daelim Industrial Co. Ltd. – 2006 (3) STR 124 (Tri) was not in accordance with Supreme Court ruling in BSNL case 2006 (2) STR 161 (SC) and prima facie not correctly decided. Also, turnkey works contract requires reconsideration and therefore referred to Larger Bench. Summary rejection means, Supreme Court declining to interfere with the impugned order. Reconsideration of impugned decision was not barred by summary dismissal or appeal.

CCE, Raipur vs. BSBK Pvt. Ltd. 2009 (13) STR 26 (Tri-Del.)

B] VALUATION:

19. The Tribunal in the case held that in terms of section 67(2) of Finance Act, 1994, if invoice specifically did not mention that gross amount charged includes Service tax, then it could not be treated as cum-service tax price. Cum-tax benefit was not extendable in absence of evidence to show that invoice was prepared in that manner.

Shakti Motors vs. CST, Ahmedabad 2008 (12) STR 710 (Tri-Ahmd.)

20. In this case Tribunal held that payment made on behalf of service recipient by service provider in the course of rendering service was reimbursement. The gross receipt for the service rendered means only for the services rendered. The amount of money received only for the services rendered and not for all the expenditure, which was to be incurred normally by the client was liable to tax. Therefore, it was not necessary that for each service, there should be a provision in the Finance Act, 1994 regarding deductions from the gross receipts as held out by the learned Commissioner (Appeals).

Rolex Logistics Pvt. Ltd. vs. CST, Bengaluru 2009 (13) STR 147 (Tri-Bang.)

C] CENVAT CREDIT:

21. The Tribunal held that, input service includes service rendered for outward transportation up to place of removal and Custom House Agent (CHA) services were required to facilitate clearance of final products from the place of removal i.e. load port. Thus, the Tribunal allowed the cenvat credit of service tax paid on CHA service used for export of goods outside India.

CCE, Rajkot vs. Adani Pharmachem P. Ltd. 2008 (12) STR 593 (Tri-Ahmd.)

22. In this case, the assessee availed cenvat credit of service tax paid on Goods Transport Agency services used for transportation of finished goods from factory to consignment agent’s premises. The Tribunal held that consignment agent’s premises was also defined as place of removal and property in goods never passed to consignment agent, therefore the order of Commissioner allowing cenvat credit of service tax paid on such service was upheld.

CCE, Rajkot vs. Rajhans Metals P. Ltd. 2008 (12) STR 597 (Tri-Ahmd.)

23. The Tribunal held that Input service as defined under rule 2(l) of CCR, 2004, includes a plethora of other services such as services used directly or indirectly in relation to manufacture and hence rent a cab service was to be considered as being used indirectly in relation to manufacture or as part of business activity for promoting business as any facility given to employees would result in greater efficiency and promotion of business.

CCE, Nasik vs. Cable Corporation of India Ltd. 2008 (12) STR 598 (Tri-Mumbai)

24. In this case cenvat credit was denied as address mentioned in the invoice was not registered with Revenue authorities. However, the registration certificate was amended subsequently to include the address mentioned in the invoice with retrospective effect. The Tribunal held that order denying cenvat credit was not sustainable.

Raaj Khosla & Co. Pvt. Ltd vs. CST, Delhi 2008 (12) STR 627 (Tri-Del.)

25. In this case, the assessee availed cenvat credit on the basis of TR-6 challan during 1-1-2005 to 16-6-2005, however department rejected credit on the ground that during said period TR-6 was not a valid document. The Tribunal held that, TR-6 challan being valid document, credit of service tax paid on GTA service is admissible.

CCE, Meerut-I vs. Shree Sidhbali Steels Ltd. 2009 (13) STR 284 (Tri-Del.)

26. In this case, assessee claimed cenvat credit of service tax paid on mobile phones. Assessee had given specific undertaking to use mobile phone for official purpose only as noted by the Commissioner. The Tribunal held that Commissioner’s order granting benefit based on Board’s Letter F. No. 149/6/2006-CX. 4, dated 19-7-2006 is legal and proper.

CCE, Bangalore-III vs. Stanzen Toyotetsu India (P) Ltd. 2009 (13) STR 289 (Tri-Bang.)

27. The assessee was in the manufacture of refined oil and vanaspati, used CENVAT credit on capital goods viz. acid oil plant used for refining and processing and credit of duty paid on computers, paints and welding electrodes. The Tribunal held that the refinery was part of the factory and the assessee could take credit of duty paid on capital goods and not on exempted or nil-rated goods. The impugned goods produced PFAD also, which was cleared on payment of duty. Acid oil was also cleared on payment of duty. Thus, machinery installed in refinery was not exclusively deployed in producing only non-dutiable products. Declarations as per the rules, records, invoices and returns relating to credit had been furnished to the Dept. indicating that PFAD was also acid oil which was cleared on payment of duty. Likewise, credit on duty on computers, electrodes were allowed. The order itself was set aside and appeal was allowed.

Ruchi Health Foods Ltd. vs. CCE, Chennai, 2009 (13) STR 330 (Tri.-Chennai)

28. The appellant availed cenvat credit of service tax paid on CHA and C&F agent services. The Tribunal held that, impugned issue is covered by decision in Excel Corp Care Ltd. 2007 (7) STR 451 (Tri) holding CHA service in respect of export not having nexus with manufacture and clearance from factory and services rendered in port is not covered by input service, therefore order denying credit upheld.

Nirma Ltd. vs. CCE, Bhavnagar, 2009 (13) STR 64 (Tri-Ahmd.)

29. The Tribunal held that, admissibility of credit on inputs/capital goods used for power plant set up by various manufacturers for generating electricity to manufacture excisable goods was well-settled and hence benefit of cenvat credit on services of supply of manpower and operation and maintenance of power plant was admissible.

Sanghi Industries Ltd. vs. CCE, Rajkot, 2009 (13) STR 167 (Tri-Ahmd.)

30. The appellant in this case received maintenance and repair services in wind energy plant producing electricity situated 200 kms. from factory. The electricity produced by the said plant was sent to electricity grid and assessee was permitted to draw power from grid for use in factory. The Tribunal held that transaction of delivery of power to electricity board and sale of power by electricity board were two independent transactions and there was no direct nexus between services received in power plant and items manufactured in factory. The power plant was also not a captive power plant. Hence, it was held that, cenvat credit of service tax paid on maintenance and repair services in wind energy plant was not admissible.

Ellora Times Ltd. vs. CCE, Rajkot 2009 (13) STR 168 (Tri-Ahmd.)

31. In this case, the Tribunal held that Cenvat credit of service tax paid on mobile phones, CHA service, surveyor’s service, Rent a cab service was admissible as they were used for providing output service i.e. port and storage and warehousing service. Cenvat credit of service tax paid on club house fees was not admissible as the same was meant for recreation of workers and not used for providing output service. Cenvat credit of excise duty paid on Air Conditioner was admissible as capital goods. Cenvat credit of excise duty paid on cement and steel used for construction of jetty and storage tanks was not admissible as statutory definition of input restricts the credit only when inputs were used for providing output service. The definition of input used for manufacture and for providing output service was different and provided under different clauses. The cement and steel was input used for output service of construction of building and not inputs used for providing port services.

Mundra Port & SEZ Ltd. vs. CCE, Rajkot, 2009 (13) STR 178 (Tri-Ahmd.)

D] PENALTY

32. The Tribunal in the case observed that the assessee was not only aware, but also recovered service tax from customers. Amount collected as tax was not paid to the Department but pocketed by the assessee. Tax was paid with interest only on detection by Department. The Tribunal on facts and circumstances of the case held that, leniency shown by Appellate Authority in setting aside penalties was not sustainable and upheld order-in-original imposing penalty.

CST Mumbai vs. B. G. Talwalkar Physique Club 2008 (12) STR 616 (Tri-Mum)

33. The Commissioner (Appeals) reduced the penalty u/s. 76 against which the Revenue filed an appeal and contending that S. 76 was unambiguous and did not provide liberty to reduce penalty. Tribunal considering various decisions in which authorities used discretion to impose less penalty u/s. 80 of the Finance Act, 1994 rejected the Revenue’s appeal and extension of S. 80 by the lower authority was upheld.

CCE – Rajkot vs. Shri BSGK Shashtry, 2009 TIOL 173 CESTAT-AHM

34. The appellant had made payment of service tax along with interest before issue of SCN. Thus the Tribunal held that there was no intention to evade duty, having bona fide belief and there were factors, which created confusion and after relying on decision in Majestic Mobikes Pvt. Ltd. 2008 (11) STR 609 (Tri), the Tribunal set aside the order passed by revisionary authority enhancing penalty.

Vinayaka Travels vs. CST, Bengaluru 2009 (13) STR 31 (Tri-Bang.)

E] OTHERS

APPEAL:

35. In this case appeal filed by the department was dismissed as non-maintainable as the required authorization filed by the department was not proper and legal. The department applied for restoration of appeal and filed required authorization. In view of the facts, the Tribunal held that subsequent authorization after dismissal of appeal had no value at all.

CCE, Belapur vs. Coromandel Fertilizers Ltd. 2008 (12) STR 781 (Tri-Mum.)

36. In this case Tribunal held that, since Reviewing authorities were not validly appointed by appropriate notification in Official Gazette to exercise powers of review, the appeal filed by revenue was not maintainable.

CCE & ST, BBSR-II vs. Mahanadi Coalfields Ltd. 2009 (13) STR 409 (Tri-Kolkata)

Burden of Proof:

37. The orders passed by the Tribunal and the High Court did not consider distinction between assessment orders under the Income-tax Act and Sales Tax Act inasmuch as the fact that income tax would be levied on the entire income, whereas sales tax could be levied only on the ‘sale’ and not the other income which did not result out of ‘sale of goods’. The condition precedent to the passing of an order was assessment of sale. Professional service rendered did not constitute sale, which attracted service tax. Further, the Supreme Court ruled that in general law, the burden of proof lay with the State and ‘reverse burden’ must be construed having regard to the nature of the statute. In the Kerala General Sales Tax Law, however, S.12 places the burden on the assessee, provided a transaction of ‘sales’ has taken place and at least one party to it is a dealer. Appeal was allowed by way of a remand to the adjudicating authority for consideration of materials placed by the appellant.

Haleema Zubair v. State of Kerala, 2009 (13) STR 113 (SC)

Certificate of Registration:

38. The Supreme Court in the case held that Registration Certificate granted to an assessee by Assessing Officer mentioning fuel and lubricants as raw material is in the nature of an order. As diesel was specifically and intentionally included in definition of raw material by legislature, question whether it is directly or indirectly used in process of manufacture was irrelevant.

CTO, Udaipur vs. Rajasthan Taxchem Ltd. 2008 (12) STR 660 (SC)

Demand:

39. In this case, the appellant provided security services to PSU-client. The said PSU deposited service tax on behalf of appellant to the government treasury, which was accepted by the jurisdictional authorities. The department contended that liability of appellant could not be discharged by the client and sought to demand tax from appellant. The Tribunal held that demand was not sustainable as service tax has already been paid by PSU and interest for delayed payment of tax also been deposited by the appellant.

Invincible Security Services vs. CCE, Noida, 2009 (13) STR 185 (Tri-Del.)

40. In this case, department sought to demand tax on 5% amount allowed as discount/commission to distributors (appellant) on sale of SIM cards under Business Auxiliary service. The Tribunal observed that service tax had been paid on full value of SIM card by principal. Thus the entire consideration charged from customers had been subjected to service tax and the findings that appellant was promoting business of sale or service of principal was misconceived.

R. Venkataraman vs. CCE, Trichy; 2009 (13) STR 187 (Tri-Chennai.)

41. The department in this case demanded service tax by alleging that the appellant received warranty labour charges by including the same in the margin for dealer from manufacturer at the time of purchase of vehicle. The Tribunal observed that value of service already included in price of vehicle paid by customer and is included for payment of excise duty and sales tax. The appellant had not received any extra payment from customers. The certificate given by the manufacturer that they had not paid any actual reimbursement towards service charges was not contradicted by Revenue. Therefore, it was held that the demand and penalties are not sustainable.

Hindustan Auto House (P) Ltd. vs. CCE, Jaipur, 2009 (13) STR 187 (Tri-Chennai.)

Export of Services:

42. The appellant paid service tax on services in relation to marketing of products manufactured by subsidiary located abroad under Business Auxiliary service. The Tribunal held that booking of order in India is not indicative of rendering of services in India. Services were delivered only to company located abroad and same could not be considered as delivered in India when recipient was located abroad. The benefit of such service was derived by recipient and hence services were utilized out of India. Therefore, the impugned services having been exported, exemption under Export of Service Rules, 2005 was admissible.

ABS India Ltd. vs. CST, Bengaluru 2009 (13) STR 65 (Tri-Bang.)

Extra Ordinary Tax Payer Friendly Scheme:

43. The Court in this case held that the Extraordinary Taxpayer Friendly Scheme was purported to provide benefit to persons who earlier failed to register themselves with the Department. The scheme was intended to cast the net of Service Tax wider and wider and augment revenue. The scheme was applicable not only to those service providers who had registered themselves after the introduction of scheme i.e. after 20-9-2004, but also to those service providers who failed to register at the appropriate time as required by the Act prior to 20-9-2004. The benefit of scheme was available, only if the payment of service tax and interest was made by 30-10-2004 (extended up to 30-11-2004). If payment was not made by that date then benefit of scheme was not available.

UOI vs. Amit Kumar Maheshwari, 2009 (13) STR 119 (Raj.)

Import of Services:

44. Service tax was demanded under consulting engineer services for import of services. The appellant received service of consulting engineer from their holding company and the period under dispute was 6-8-2002 to 9-9-2004. The Larger Bench of the Tribunal’s decision in the case of Hindustan Zinc Ltd. v. CCE, 2008 (11) STR 337 (Tri.-LB) was followed, finding the facts of the case similar and relief was provided for the period prior to 1-1-2005.

Nestle India Ltd. vs. Commissioner of Service Tax, New Delhi, [2008 (12) STR 570 (Tri.-Del.)]

Interest:

45. The Tribunal held that when refund was granted in respect of any amount illegally collected, without authority of law, department was liable to pay interest from the date of payment of duty to the date of actual payment of refund at the rate as defined under section 11BB of the CEA, 1944.

Binrajka Steel Tubes Ltd. vs. CCE, Hyderbad-III 2008 (12) STR 788 (Tri-Bang.)

Jurisdiction:

46. In this case, the Hon’ble Gujarat High Court held that as no notice was ever issued by appellate authority, condition precedent for assumption of jurisdiction and exercise of powers under section 35A(3) of CEA, 1944 had not been fulfilled. If the appellate authority had failed to comply with the requisite statutory provisions and show from the record satisfaction of the prerequisite condition for exercise of jurisdiction to enhance the assessment by making addition of any duty of excise, which had not been levied or paid etc. the appellate authority could not be permitted a second innings. The appellate order was thus set aside.

Patel Filters Ltd. vs. UOI 2009 (13) STR 245 (Guj.)

Limitation:

47. In the case it was held that, point of limitation goes to the root of the matter and being a question of law that could be agitated at any stage of pendency of appeal and therefore, Miscellaneous Application for raising above additional ground was allowed.

Damodhar Cement & Slag Limited vs. CCE, Bolpur, 2009 (13) STR 220 (Tri-Kolkata)

Notification:

48. The Tribunal in this case held that, benefit of Notification No. 12/2001-ST was available to high tea provided by the service provider. The expression “substantial and satisfying meals” was not defined in the Notification. High tea was a concept associated with early evening meal. It was further held that, each and every invoice was not required to be scrutinized to find out number of items supplied. Mandap keeper providing catering and invoice included charges for catering, was sufficient to determine exemption admissibility.

Welcome Hotel vs. CCE, Vadodara 2009 (13) STR 375 (Tri-Ahmd.)

Rate of Tax:

49. The Tribunal observed that, premium to be collected in advance and policy was to be issued as per Insurance Act, 1938. The date of receipt of insurance premium was the date of rendering service. It was held in Art Leasing Ltd. 2007 (8) STR 162 (Tribunal) that service tax was payable as per rate of tax prevalent on the date of contract was applicable and hence, enhancement of tax rate not applicable to policies issued prior to such enhancement.

Bajaj Allianz General Insurance Co. Ltd. vs. CCE, Pune 2009 (13) STR 259 (Tri-Mumbai)

Refund:

50. In this case, the department refused the refund claim of the appellant on the ground that assessment was not challenged. The Rajasthan High Court held that when no order capable of being appealed against, had ever been passed, it could not be said that the assessee could file appeal against the assessment order, and not having so filed appeal he could not lay the claim of refunds.

Central Office Mewar Palace Org. vs. UOI 2008 (12) STR 545 (Raj.)

51. The appellant in the case entered into a contract with service receiver inclusive of all taxes, duties, VAT etc. for providing services of survey and mapping. The appellant paid service tax under consulting engineer service but claimed refund of the same subsequently. The Tribunal held that, it was reasonable to presume that tax was taken into account for quoting contract price as price was inclusive of all taxes, duties etc. and therefore order of original authority crediting refund to consumer welfare fund was upheld.

Multi Mantech International Pvt. Ltd. vs. CST Ahmedabad 2008 (12) STR 717 (Tri-Ahmd.)

52. In this case, the Court held that mere pendency of SLP for admission could not be used as ground to deprive or postpone the benefits of order of Tribunal. It was further held that petitioner was commercial establishment and was deprived of its liquidity in trade, commerce and business and such deprivation was bound to cause substantial prejudice to it and therefore interest was payable for delayed refund under section 11BB of CEA, 1944.

Jai Bhagwati Impex Pvt. Ltd. vs. UOI, 2009 (13) STR 24 (Bom.)

53. The appellant claimed refund of service tax paid under Health Club and Fitness Centre Services on the ground that they were registered as society and services had been provided to their own members. The Tribunal held that, under any establishment providing taxable service covered. Appellant being club having health centre and hence, falling under the expression ‘health club and fitness centre’, service tax was correctly paid and refund was not admissible.

Century Club vs. CST, Bengaluru 2009 (13) STR 68 (Tri-Bang.)

54. The assessee paid service tax under the category of ‘port service’ for the period March 2004 to September 2004 and filed a refund claim of service tax and interest paid, stating that they were handling only export cargo which was outside the purview of service tax under ‘cargo handling service’ and that they had erroneously paid service tax under port services. After relevant findings, CESTAT held that the assessee was not rendering services on behalf of port, but on its own behalf to customers for loading of export cargo. Accordingly, the Revenue’s appeal was dismissed in limine.

CCE, Mangalore v. M/s. Konkan Marine Agencies, [2008 TIOL 601 HC Kar. ST]

Reasoned Order:

55. The appellant was aggrieved by the order of ITAT as the order was passed after 4 months of hearing, dismissing the appeal without recording reasons, propositions of the law urged and case laws relied upon by them. The High Court relying inter alia on the case of Anil Rai v. State of Bihar, 2002 (3) BCR (SC) 360, the Court directed the president of the Appellant Tribunal to issue guidelines to all the Benches of Tribunal to decide matters heard within three months from the date of closing of judgment. The Appellate Tribunal directed to rehear the said appeal and give fresh order with sound reasons.

Shivsagar Veg. Restaurant v. Asstt. Commr. of Income-tax, Mumbai, 2009 (13) STR 11 (Bom.)

Revision:

56. The Tribunal held that the revisional authority did not have powers to revise a decision of competent authority, which had refrained from imposing penalty on the assessee u/s. 80 of the Act.

M/s. Solomon Foundry vs. CCE, Tiruchirapalli (2008 TIOL 1826 CESTAT-Mad.)

57. The Hon’ble High Court held that, issue of penalty was agitated before Commissioner (Appeals) and power of review or revision was not exercisable, when original order was being subject matter of appeal and such appeal was decided before revision. The doctrine of merger was applicable in this case.

UOI vs. Inani Carriers 2009 (13) STR 230 (Raj.)

Show Cause Notice:

58. The assessee in the case paid part of service tax before issue of SCN and part after issuance of SCN along with interest. Service tax paid was appropriated towards demand of tax in adjudication. The Tribunal affirmed the order of CIT(A) dropping SCN for review following CBEC Circular F. No. 137/176/06-CX-4, dated 3-10-2007 clarifying that once tax was paid voluntarily before SCN, proceedings deemed to be concluded. In appeal filed by the department against such order, the Tribunal affirmed Commissioner’s Order.

CCE, Delhi vs. Brill Education (India) Private Limited 2008 (12) STR 759 (Tri-Del.)

59. In this case, it was observed that show cause notice was not issued for denial of cenvat credit and cenvat credit availment was not one of the grounds for rejecting refund. The Tribunal held that, the order in question was travelling beyond the scope of show cause notice. Further, the Tribunal decision in Rolex Rings Ltd. 2008 (230) ELT 569 (Tribunal) holding that cenvat credit on C&F Agent service was admissible, when place of removal was port in case of FOB exports was applicable and hence, refund of cenvat credit was admissible.

Rawmin Mining and Industries Ltd. vs. CCE, Bhavnagar-I 2009 (13) STR 269 (Tri-Ahmd.)

Stay:

60. The assessee, a co-operative society, provided treatment of effluents and managed waste generated by industrial units which were members of society. The High Court concluded that the petitioner-society had been established with the aid of Central & State Governments for treatment of industrial effluents and waste materials in public interest. The representation to the Central Government for exemption would be made within 2 weeks and would be placed by the Central Government within two months from that day. Interim stay for recovery was granted.

Green Environment Services Co-op. Society Ltd. vs. Union of India, 2009 (13) STR 250 (Guj.)

Others:

61. The Tribunal held that the issue relating to service tax on cell phones or landlines was no more res integra and stood settled by various Tribunal decisions. However, since the appellant was unable to establish that cell phones in the names of individuals were exclusively used in relation to output services, the matter was remanded to the original authority for verifying the said facts. The Tribunal also held that no penalty could be levied when the dispute related to interpretation of the provisions of law, while setting aside the penalty.

Wiptech Peripherals Pvt. Ltd. vs. CCE, Rajkot 2008 (12) STR 716 (Tri.-Ahmd.)

62. In the present case, the department demanded service tax on amount collected by the appellant from its own refinery towards cost of additives used in ‘extra mile diesel’. The Tribunal held that, there was no case of Revenue that appellant rendered any service to anybody else, nor any service recipient was identified in impugned order hence, so-called service rendered to themselves could not be subjected to service tax.

Senior Terminal Manager IOC Ltd. vs. CCE, Tirunelveli 2009 (13) STR 287 (Tri-Chennai)

63. The Tribunal in this case held that departmental instructions conferring jurisdiction on departmental officers based on some monetary limits were only to supplement administrative functions and do not take away rights or cause any prejudice to parties or affect jurisdiction of statutory bodies.

CCE, Mumbai vs. Central Cable Pvt. Ltd. 2009 (13) STR 328 (Tri-Mumbai)

64. In this case, demand of tax was confirmed against the recipient of Goods Transport Agency service. The appellant contended that service tax had already been paid by the transporters. Revenue contended that appellant alone was liable for GTA service and payment of tax by transporters was not valid. The Tribunal held that once tax was paid, same amount could not be confirmed again in respect of same service.

Navyug Alloys Pvt. Ltd. vs. CCE&C, Vadodara-II 2009 (13) STR 421 (Tri-Ahmd.)

F] WAIVER OF DEPOSIT

Pre-Deposit

65. The appellant was in the business of collecting export goods from different Indian suppliers for a foreign party under an agreement with the latter. Such goods were consolidated into one cargo and exported for a consideration in Indian rupees. Thus, the appellant was undertaking the activity of handling of export cargo that was excluded from the ambit of cargo handling service. The Revenue contended to tax this activity as ‘Business Auxiliary Service’ as services were provided on behalf of client. Since the matter involved detailed examination for Revenue’s claim, waiver of pre-deposit was granted.

APL Logistics India (Pvt.) Ltd. v. Commissioner of Service Tax, Chennai, 2008 (12) STR 588 (Tri-Chennai)

66. The Revenue denied the credit on the ground that the credit was availed on the strength of improper document. It stated that the invoices were in the name of Headquarter Bhopal, whereas credit was taken at Jabalpur on the strength of debit notes. However the appellant contented that invoices for capital goods received at Jabalpur were issued in the name of circle Headquarter i.e., Bhopal, and Jabalpur comes under the Bhopal circle. Further, there was no dispute as to payment of duty on those capital goods and they were used for providing output service. Finding merit in the contention, waiver of pre-deposit and penalties were granted.

M/s. BSNL vs. CCE, Bhopal (2008 TIOL 1938 CESTAT-Del.)