CESTAT CHENNAI BENCH vide F.O. No. 845/09  dt 13/07/09 in re: CCEX CHENNAI vs PARACOAT PRODUCTS (P) LTD held as follows : -

QUOTE : The issue in dispute in this appeal is the eligibility to CENVAT / MODVAT credit on plastic crates and bins used as material handling equipment within the factory for internal transportation of goods.

I have heard both sides and find that the issue stands now settled in favour of the assessees by decision of the Larger Bench in BANCO PRODUCTS (India) LTD vs COMMISSIONER OF CENTRAL EXCISE, VADODARA-I [2009-235-ELT 636 (Trib-LB). The Tribunal has held that CENVAT / MODVAT credit is admissible on plastic crates as capital goods and the Larger Bench has also held that the plastic crates are inputs for the purpose of eligibility of MODVAT credit. Following the decision of the Larger Bench cited supra, I uphold the impugned order and reject the appeal. UNQUOTE

In the following Final Orders also, the same Chennai Bench took the same decision as mentioned above : -

F.O. No. 842/09 dt 14/07/09  in re: CCE CHENNAI vs FIEM INDUSTRIES LTD  & 836/09 dt 13/07/09 in re: CCEX PONDICHERRY vs LEO FASTENERS LTD. 

[for full text of the judgement please visit http://www.taxesinindia.com and click on the citations taxind_2009_szb_c_845 , taxind_2009_szb_c_842 & taxind_2009_szb_c_836]

TRIBUNAL ORDERS

VENKATRAMAN RAGGHUPATHY, Web admin.

CESTAT ORDERS bins capital goods, CENVAT, credit, input, MODVAT, plastic crates

CESTAT CHENNAI BENCH vide F.O.848-849/09 dt 15/07/09 in re: CCEX [ST] CHENNAI vs VISTEON POWERTRAIN CONTROL SYSTEMS LTD. & I.M. GEARS P. LTD held as follows : -

QUOTE : I have heard both sides and find that the issue is now no longer RES INTEGRA as it stands settled in favour of the assessee and against the Revenue by the decision of the Larger Bench of the Tribunal in the case of CCE MUMBAI vs GTC INDUSTRIES LTD [2008-12-STR-468 -Tri.-LB]. The Bench has held that outdoor catering service is input service and, therefore, CENVAT credit is admissible thereon. Following the ratio of the above decision, I uphold the impugned order and extend the credit, and dismiss the two appeals. UNQUOTE

[for full text of the judgement, please visit http://www.taxesinindia.com  and click on the citation taxind_2009_szb_c_848_849]

TRIBUNAL ORDERS

VENKATRAMAN RAGGHUPATHY, Web admin.

CESTAT ORDERS catering, CENVAT, credit, outdoor, SERVICE TAX

CESTAT CHENNAI BENCH vide Final Order No. 850-851/09 dt 15/07/09 in re: LUCAS TVS LTD & INDIA JAPAN LIGHTING PVT. LTD vs CCEX CHENNAI held as follows : -

QUOTE : The issue in dispute in the present case, namely, as to whether interest is leviable on differential duty payable on the strength of supplimentary invoices stands settled against the assessee by a recent decision of the Apex Court in COMMISSIONER OF CENTRAL EXCISE PUNE vs SKF INDIA LTD. The Apex Court has held that interest is leviable on delayed or deferred payment of duty for whatever reasons and since differential duty was paid only later when the assessee issued supplimentary invoices to its customers, it was clearly a case of shrt payment of duty and thus the payment of differential duty clearly fell under sub-section (2B) of Section 11A and attracted levy of interest under Section 11AB of the Central Excise Act. Following the ratio of the decision cited supra, the impugned orders are upheld and the appeals are dismissed. UNQUOTE.

Same decision was taken by the same bench vide F.Os.  No. 843-844/09 dt 14.07.09 in re: AXLES INDIA LTD vs CCEX CHENNAI and 837/09 DT 13/07/09 in re : REDEEMA vs CCEX CHENNAI.

[for full text of the judgements please visit http://www.taxesinindia.com and click on the citations taxind_2009_szb_c_850_851 , taxind_2009_szb_c_843_844 &  taxind_2009_szb_c_837 ]

TRIBUNAL ORDERS

VENKATRAMAN RAGGHUPATHY, Web admin.

CESTAT ORDERS differential duty, interest, supplimentary invoices

SUPREME COURT OF INDIA while deciding on 04/05/09 the Civil Appeal No.3169 of 2009 in re: JAI BHAGWAN OIL & FLOUR MILLS observed as follows : -
QUOTE : The object of the Transport Subsidy Scheme is not augmentation of revenue, by levy and collection of tax or duty. The object of the Scheme is to improve trade and commerce between the remote parts of the country with other parts, so as to bring about economic development of remote backward regions. This was sought to be achieved by the Scheme, by making it feasible and attractive to industrial enterpreneurs to start and run industries in remote parts, by giving them a level playing field so that they could compete with their counterparts in central (non-remote) areas. The huge transport cost for getting the raw materials to the industrial unit and finished goods to the existing market outside the side, was making it unviable for industries in remote parts of the country to compete with industries in central areas. Therefore, industrial units in remote areas were extended the benefit of subssidized transportation. For industrial units in Assam and other north-eastern States, the benefit was given in the form of a subsidy in respect of a percentage of the cost of transportation between a point in central area (Siliguri in West Bengal) and the actual location of the industrial unit in the remote area, so that the industry could become competitive and economically viable. So when the Scheme refers to finished goods coming out of or being exported from the State (remote area), it refers to any goods manufactured or produced by an industrial unit in the State in accordance with the manufacturing programme approved by the Central Government and / or the State Government. So long as the goods coming out is something identifiable, something which has undergone a process of manufacture, something which is marketable and tradable as a commodity, something that is completely different and distinct from raw material as a product, something that was intended to be a definite product of manufacture by the industrial unit, the product has had to be considered as “finished goods” from the industrial unit. Any goods which goes in as a raw material required / used in the manufacturing programme of an industrial unit situated n a notified remote area, or any finished goods that is produced in the industrial unit situated in such area and exported out of the State, was eligible for the transport subsidy under the scheme.UNQUOTE

[for full text of the judgement, please visit http://www.taxesinindia.com and click on the citation taxind_2009_sc_ca_3169]

SUPREME COURT JUDGEMENTS

VENKATRAMAN RAGGHUPATHY, Web admin.

SUPREME COURT JUDGEMENTS FINISHED GOODS, MARKETABLE, PROCESS OF MANUFACTURE, REMOTE AREA, SUBSIDY, TRADABLE, TRANSPORT

TODAY, the 25th of JULY, 2009, Honourable Union Finance Minister Shri Pranab Mukherjee will be inaugurating the Indian Customs & Central Excise Museum at Goa.

The Indian Customs and Central Excise Museum has been conceptualised to depict the never-ending battle between the smugglers / tax evaders and the Men on duty. The Museum through its collection of rare and unique items on display traces the evolution of this theme from the days of Indua Valley Civilization till present time. It takes forward the same theme through artefacts, documents, manuscripts, photographs etc. to give an aura of the continuous action and counteraction. The Musuem is located at PANAJI, Goa in a heritage building called, “Blue Building” by the banks of Mandovi river.

Visitors to Goa now have yet another new and evergreen attraction to explore.

[Source: DIRECTORATE OF PUBLICITY AND PUBLIC RELATIONS, CUSTOMS, CENTRAL EXCISE AND SERVICE TAX, C.R. BLDG, I.P. ESTATE, N. DELHI.]

[FOR MORE SUCH HIGHLIGHT INFORMATIONS, please visit http://www.taxesinindia.com]

VENKATRAMAN RAGGHUPATHY, Web admin.

MUSEUM CENTRAL EXCISE, CUSTOMS, GOA, MANDOVI RIVER, MUSEUM, SERVICE TAX

CESTAT PRINCIPAL BENCH AT N. DELHI while delivering the final order no. 665/2009-SM (BR) on 23/06/09 in re: CCEX ALLAHABAD vs MODERN LAMINATORS LTD, held as follows : -

QUOTE : The only issue involved in this case is as to whether the Respondent are eligible for Cenvat credit of Service Tax paid on the Outward transportation of the finished goods from the factory gate to the Customer’s premises. I find that this issue now stands settled in favour of the Respondent by the Larger Bench of the Tribunal in the case of ABB & Ors. Vs CCE & ST, BANGALORE [2009-15-STR-23-TRIB.LB]    wherein it has been held in clear terms that outward transportation of goods from the place of removal is an input service as it is covered by the expression “activities relating to business” used in the definition of “input service” and that the issue of valuation and issue of Cenvat are independent of each other and have no relevance to each other. In view of this, following the Larger Bench’s decision , I hold that there is no infirmity in the impugned order. The Revenue’s appeal is dismissed. The cross objection filed by the Respondents also stands disposed off.  UNQUOTE

[for full text of the judgement please visit http://www.taxesinindia.com and click on the citation taxind_2009_nb_sm_665]

CESTAT JUDGEMENTS

VENKATRAMAN RAGGHUPATHY, Web admin.

CESTAT ORDERS ACTIVITIES, BUSINESS, CENVAT, INPUT SERVICE, OUTWARD, RELATING TO, SERVICE TAX, TRSPORTATION

CESTAT CHENNAI BENCH  vide Final Order No. 772/09 decided on 26.06.09 in re: CCEX CHENNAI vs HEMA ENGG. INDUSTRIES LTD observed as follows:-

QUOTE:

I have carefully considered the submissions and perused the case records In the instant case the Revenue seeks to vacate the orders of the lower authorities holding that plastic crates were eligible for CENVAT credit as inputs Vide the impugned order the Commissioner relied on an earlier order of his in the case of Leo Fasteners (Order- in-Appeal No. 106/2006 (P) dt 19.12.06) wherein he had allowed CENVAT credit on plastic trays as capital goods and sustained the order of the original authority in the instant case I find that in the decision of the Larger Bench of the Tribunal cited supra the tribunal had held as follows:-

“ We fully agree with the above judgment on the issue The Plastic crates are used for transporting storing of the goods in the factory of production proper storage of inputs is essential for efficient manufacturing process and in absence of proper facilities for storage and transportation the same will affect the manufacturing process further the hon ble supreme Court in the case of M/s Rajasthan State chemical works has observed of that the manufacturing process starts with the drawing of water from the reservoir By applying the same fact it can be safely concluded that the manufacturing process starts with the issuance of the inputs the from the stores and their further transportation to the production platform is only a part of the process of manufacturing integrally related to the final production in absence of the delivery of the raw material to the manufacturing platform the process cannot start Such delivery of the goods includes transportation of the goods by plastic crates Similarly finished products are required to be stored in a bonded store room the plastic crates are again used for such transportation. As such we are of the view that the plastic crates would also be eligible for Modvat credit as input.    UNQUOTE

[for full text of the judgement please visit http://www.taxesinindia.com  and click on the citation taxind_2009_szb_c_772]

TRIBUNAL JUDGEMENTS

VENKATRAMAN RAGGHUPATHY, Web admin.

CESTAT ORDERS capital goods, CENVAT, inputs, plastic crates

IN THE HIGH COURT OF KERALA AT ERNAKULAM, the judgement in respect of Writ Petition ( C ) No. 7376 of 2009 (N) decided on 12.3.09 in re: M.K. THAHA vs U.O.I reads as follows : -

QUOTE : Petitioner is a facilitator for Haj pilgrims in respect of the quota allotted by Govt. of India each year. Exr. P2 is the notice issued by the Superintendent calling up on the petitioner to provide certain details with supporting documents, copy of audited balance sheet etc. It is stated in Ext. P2 that it is understood that the petitioner is operating outbound tours / pilgrimages and petitioner is not paying service tax. According to the petitioner, he is not a tour operator. The relevant statutory provision in Section 65 (105) (n). As per the section TAXABLE SERVICE means any service provided or to be provided to any person by a tour operator in relation to a tour. According to the petitioner, petitioner is only a facilitator for HAJJ and UMRAH pilgrims to perform obligatory HAJJ and UMRAH in the Holy cities of MECCA and MEDINA and also at MINA, ARAFA, MUZDALIFA etc. HAJJ is obligatory to all muslims, men and women. if he is financially sound and physically fit, it is stated. Petitioner submitted Ext. P3 brief note on the nature of operation. By Ext. P4, petitioner was called upon to furnish details. Ext. P6 is again calling upon the petitioner to furnish further details.UNQUOTE

The Court held that in such circumstances, petitioner may produce any further documents which are to be produced within one month from today and the officer will consider the documents and any subsequent instructions which may have been issued and take a decision in the matter in accordance with law. The officer may drop the proceedings if such a view is warranted on consideration of the matter. On the other hand, if the officer feels that the petitioner is liable, te officer will issue show cause notice to the petitioner before taking a decision in the matter in accordance with law.

[for full text of the judgement, please visit http://www.taxesinindia.com and click on the citation taxind_2009_hc_ker_wpc_7376]

HIGH COURT JUDGEMENT

VENKATRAMAN RAGGHUPATHY, Web admin.

HIGH COURT JUDGEMENTS facilitator, IN RELATION TO, tour, tour operator

THE HIGH COURT AT CALCUTTA while deciding the Writ petition no. 122 of 2009 on 25/02/09 in re: STEEL UNION PVT. LTD. vs COMMISSIONER OF CUSTOMS held as follows : -

QUOTE : Though the respondents say that they have neither called upon the second highest bidder to accept the goods at the price offered by such bidder nor taken any steps to call a fresh auction, the petitioners are undeserving of even a liberty being granted to seek extension of the time to make the balance payment and receive the goods. There is simply no case that the petitioner has been able to make out. It is distressing that such an unworthy cause was not stopped at any level of screening before it reached court. The unabashed attempt to slip out of a binding arrangement and the complete lack of diffidence reveal either an unflattering assessment of the judicial process or the more fashionable psyche of making a matter sub judice to ward off an indeniable claim. Speculating in metals is risky business. The exhilaration of money pouring in following a good call made on a given day is chillingly dampened in the chargin of the payout that may have to be made on the next. As much as there may be profit in the speculation business in the market, speculation on a bad cause is depressingly expensive.-UNQUOTE

[for full text of the judgement, please log on to http://www.taxesinindia.com and click on the citation taxind_2009_hc_cal_wp_122]

HIGH COURT JUDGEMENT

VENKATRAMAN RAGGHUPATHY, Web admin.

HIGH COURT JUDGEMENTS binding arrangement, extension of time, lack of diffidence, unabashed attempt

THE HIGH COURT OF JUDICATURE AT BOMBAY while deciding on 15/04/09 the writ petition no. 2809 of 2008 in re: FROST INTERNATIONAL vs U.O.I. observed as follows: -

QUOTE : In our opinion, respondent no.5 is entitled to recover demurrage charges so far as goods which were stored in their premises. It is the case of the petitioner that since the petition is admitted and there is challenge to the policy, interim relief should be granted. In our opinion, merely on the basis of admission of petition, interim reliefs cannot be granted as sought for. Firstly, so far as Port Trust is concerned, they are entitled to claim from the petitioner demurrage charges in respect of goods stored in their premises. Though respondent no.5, Port Trust has a policy of granting remission for importers it necessarily prima facie does not mean that the same policy should be extended to the exporter. That is a policy decision. Apart from that Clause 10 of the policy confers general powers which can be exercised even in case of export, which in the instant case has been exercised. Whether that exercise is proper will be decided at the time of hearing of the case. On 31/3/2004 the goods were imported by the petitioner at Port of Mumbai. The order of CESTAT is dt. 5/5/2006 whereby it was held that the goods are not liable to the confiscated and the exporter and others are are not liable to be confiscated and the exporter and others are not liable to penalty. The request for waiver of demurrage charges for the first time was made on 27/07/07 to Traffic Manager, MPT. In our opinion, therefore, no case is made out for interim reliefs. Interim reliefs rejected. UNQUOTE

[for full text of the judgement, please visit http://www.taxesinindia.com  and click on the citation taxind_2009_hc_bom_wp_2809]

HIGH COURT JUDGEMENT

VENKATRAMAN RAGGHUPATHY, Web admin.

HIGH COURT JUDGEMENTS DEMURRAGE, INTERIM, POLICY, RELIEF