Leaf No : 41
Month : August
Year : 2013
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Greetings from Team SA!

 National Vote Securing Bill, nay, Food Security Bill passed. 

 Mr. Yasin Bhatkal, the alleged head of the Indian Mujahideen (IM) militant group, which has been blamed for a string of recent attacks in the cities of Pune, Bangalore, Hyderabad, Mumbai and Delhi has been arrested.

 India has launched its first satellite dedicated solely to military use - GSAT - 7 from the Kourou spaceport in French Guiana.

 Prime Minister Manmohan Singh announced a new scheme in skill development programme tol be launched to benefit a million youth in a year. Targets 500 million by 2022.

 Gram panchayats to get broadband speed of up to 100 mbps and the project to financed by Universal Service Obligation Fund at an initial estimated cost of Rs 20,000 crore.

 Govt rules out creation of mre States.

 The Companies Bill 2012 passed.

 FM assures no wealth tax on farm land. 

 Petrol price further hiked by a steep Rs. 2.35 per litre, the sixth increase in rates in three months, and diesel by 50 paise per litre in line with falling rupee and firming international oil prices.

 GDP growth slips to 4.4%, the slowest since 2008 meltdown.

  ... and the Indian Rupee continues its freefall.

sa corner

In an appeal by the department before the Hon’ble High Court against the orders of CESTAT, the issue was utilization of Cenvat credit availed on inputs and capital goods for the payment of service tax liability on the Goods Transport Agency by a manufacturer of cotton yarn. After hearing the arguments advanced, the Hon’ble High Court had concluded that:

• Going by the fiction under Section 68(2) of the Finance Act, 1994 and CENVAT Credit Rules, 2004 deeming the payer of service tax as the person liable for paying the Service Tax in relation to such service, the explanation given under “output service” in Rule 2(p) of Cenvat Credit Rules, deem that in the case of a person not providing taxable services or manufacturing final products but liable for paying Service Tax, the service for which he is liable to pay Service Tax by reason of Section 68(2) of the Finance Act, 1994 shall be deemed as “output services”.

• Though Rule 2(l) and 2(p) cover two classes of persons, the recipient of GTA services, by virtue of the Explanation to Rule 2(p) of the Cenvat Credit Rules, as a provider of output service, is entitled to all benefits that a person providing input service would be entitled to in the matter of Cenvat credit adjustment.

• The Board’s Circular No. 345/4/2005 - TRU dated 3.10.2005 relied upon by the department will not be of any assistance to the revenue.

Thus the Hon’ble High Court have endorsed the views in the decisions of Hon’ble High Court of Punjab and Haryana, Delhi and Himachal Pradesh in the case of Nahar Industrial Enterprises, Hero Honda Motors Ltd. and Auro Spinning Mills and affirmed the decision of Tribunal in both the cases and dismissed the departmental appeal.

C.M.A No. 894 of 2008






 FTP amended inserting para 4.1.15 to the effect that only inputs actually used in manufacture of export goods should be imported under Authorisation.

 Exemption to the Import of steel and steel products for major industrial/infrastructure projects from the applicability of Steel and Steel Products (Quality Control) Second Order, 2012.

 Import of Ammonium Nitrate regulated.

 Import Policy for allocation of quota for import of Rough Marble Blocks by Indian companies.

 Import policy for Rough Marble and Travertine blocks for the year 2013-14.

 Import under the ITC HS Codes 68 is permitted freely if CIF value is US$ 80 or above per sqm.

 ADGFT given powers for suspension and cancellation of IEC and JDGFT given power of suspension of IEC subject to confirmation by ADGFT.

 All pending cases of the default in meeting Export Obligation (EO) can be regularised by the Authorisation holder on payment of applicable customs duties and interest.

 Procedure prescribed to regulate issuance of Status Recognition Certificate / Nominated Agency Certificate in case of IEC holders having both DTA units as well as SEZ Units.


 Classification of multi-function speaker systems.

 Classification of ‘Cockroach traps’ and ‘mosquito repellents’.

 Procedure regarding Project permitting export by post under claim of benefits under Chapter 3 of FTP.

 Board reiterates instructions regarding provisional release of export goods.

 Purchase order containing all essential ingredients of valid contract to be accepted as a deed of contract for purpose of Regulation 5 of Project Import Regulations.

 Goods required for development of facilities required for ultra-mega / mega-power projects are eligible for customs duty exemption, notwithstanding the fact that such facilities are set up inside or outside the power plant’s designated boundary.

 Voluntary Compliance Encouragement Scheme (VCES) clarified

circulars notifications

 Notification 1/2011-CE amended deleting Sl.No.82.

 Sl.No 187A of Notification 12/2012-CE substituted.

 Notification 12/2012-CE amended.

 Notification 12/2012-CE amended prescribing new rates of tax for goods falling under Chapter 71.

 Section 11 C benefit to small scale manufacturers using plastic containers/bottles or packing material containing brand name of another person for the period 2003 to 2010.

 Exemption from registration to premises used solely for affixing sticker/re labelling/reprinting of pharma products falling under chapter 30 with lower celing price.

 Amendments to Notification 12/2012–Cus.

 Foreign exchange rates applicable from 30.08.2013 notified.

 Revised rates for goods falling Chapter headings 15, 71, 98.

 New ICD for Haryana notified.

 Baggage rules amended subjecting LCD TV to customs duty.
 Antidumping duty on resin or other organic substances bonded wood or ligneous fibre boards.

 Timelimit for filing ST 3 returns for the period from October 2012 to March 2013 extended till 10.09.2013.

vat spot

 Form "S" regarding non-liability certificate in case of works contractor under TNVAT substituted.

 Movement restriction imposed on transportation by Parcel / Courier only through specified checkposts under Kerala VAT removed.

 Revised floor rates fixed for Plywood, Flush door and Block board under Kerala VAT.

 Sale of commodities to an industrial unit situated in a Special Economic Zone located outside the State of Kerala is an inter-state sale, for which, the set-off and refund provisions for an inter-state sale under Section 11, 12 and 13 of Kerala VAT would be applicable.

 E-payment of VAT mandatory for dealers paying amount of Rs.10,000 or more as tax under Karnataka VAT with effect from 01.09.2013.

 Budget notifications under Karnataka VAT.

 Notification regarding issuance of Form "C" for dealers who has electronically filed returns from 01.01.2013 under Karnataka VAT.

 Section 19 (11) providing for time frame for availing input tax credit is a valid piece of legislation which is not unreasonable or discriminatory or violative of Articles 265 and 360A of Constitution of India... USA Agencies vs CTO - 2013 TIOL 602 HC MAD VAT.

 Turnover assessed at hands of agent cannot again be assessed at hands of Principal as it amounts to double taxation... Reliance Industries vs State of Tamilnadu 2013-TIOL-625-HC-MAD-CT.

 Goods supplied by factory outside state directly to customer inside State of TN against purchase order placed by branch at TN amounts to interstate sale... ECE Industries Ltd vs State of Tamilnadu - 2013 TIOL 618 HC MAD CT.

 Transportation charges incurred by contractor for transporting gravel supplied free of cost by contractee shall form part of taxable turnover... Duggirala Ramakotaiah vs State of AP - 2013 63 VST 5 AP.

 When tax liability of defaulter had been reduced on revision proceedings and entire tax dues had been paid, property attached for non payment of tax dues to be reconveyed... M.K.Lakshmi vs State of Kerala - 2013 63 VST 145 Ker.

 Financial institution engaged in hire purchase transaction is entitled to make transit sale of goods purchased interstate to the ultimate purchaser... National Small Industries Corporation Ltd vs State of Tamilnadu - 2013 VIL 65 MAD.

 Refund of tax paid in case of unfructified sales is not eligible if declaration regarding same is not filed with in time limit of 30 days as given under Section 4 D of TNGST Act... Godrej Industries Ltd vs State of Tamilnadu - 2013 VIL 63 MAD.

 Decision of Advance ruling authority is binding on any dealer eventhough he has not applied for riling, if he deals in same goods in relation to which decision has been rendered... Rak Ceramics India (P) Ltd vs Assistant Commr (CT) - 2013 VIL 62 AP.


 In absence of any provision under Central Excise Act creating first charge on property, secured creditor has priority over Excise department on properties of defaulter... Rana Girders Ltd vs UOI - 2013 TIOL 39 SC CX.

 A product used mainly in curing or treating ailments or diseases and contains curative ingredients even in small quantities is to be branded as a medicament and not a cosmetic... CCE vs Ciens Laboratories Mumbai - 2013 TIOL 38 SC CX.

 Sugar and distillery units of the same company with separate registrations , on opting for single registration under sugar unit,  is entitled to transfer unutilised credit of distillery division to sugar division... CCE vs Rajshree Sugars & Chemicals Ltd - 2013 TIOL 577 HC MAD CX.

 Interest is payable on refund under the Customs Act from the date of submission of refund application and not from date of deposit of amount claimed as refund... Shakun Overseas Ltd vs Commr. of Customs, Chennai - 2013 TIOL 609 HC MAD CUS.

 High Court entertains writ petition against SCN since SCN has been issued on basis of circular in favour of revenue and adjudicating authority is bound to pass an adverse order... Karamchand Appliances Private Ltd vs UOI - 2013 TIOL 634 HC DEL CX.

 Credit eligible on proportionate plastic granules which generated excisable scrap during the manufacture of exempted IV Fluids... Albert David Ltd vs CCE - 2013 TIOL 621 HC ALL CX.

 Section 149 of Customs Act permits making endorsement on BOE post exports for claiming export benefits under VKGUY scheme – Issue referred to third member... Commr.of Customs vs Kedia Agencies Pvt Ltd - 2013 TIOL 1169 CESTAT DEL.

 In case of imports from related party, the amount paid as sole distributor fee to the manufacturer abroad could not be loaded to the assessable value in absence of any evidence that such value has any connection with sale proceeds... Volkswagen Group Sales India (P) Ltd vs Commr. of Customs - 2013 TIOL 1289 CESTAT MUM.

 Exemption to clearance of 3500 MT of paper under Notification No.06/01-CE to include weight of wrapper... CCE vs BK Kraft Ltd - 2013 TIOL 1158 CESTAT DEL.

 Aggregate value of clearance for claiming exemption on clearance of plastic pouches under Notification No.8/99 CE to include value of plastic film/plastic laminated film used captively for manufacture of such plastic pouches... Ariya Flexi Labels vs CCE - 2013 TIOL 1134 CESTAT MAD.

 Goods falling under Ch.85 are eligible for capital goods credit irrespective of the fact  as to whether such goods became part of plant and machinery embedded to earth or not... Omax Auto Ltd vs CCE - 2013 TIOL 1276 CESTAT DEL.

 Discount received on account of pre-payment of sales tax under deferred tax scheme is not to treated as additional consideration subject to excise duty... Automag India P Ltd vs CCE - 2013 TIOL 1275 CESTAT MUM.

 Technical panel appointed in relation to issue regarding classification of a commodity can comment only on technical and engineering aspect and not empowered to opine or decide on classification... Bharat Bijlee Ltd vs CCE - 2013 TIOL 1253 CESTAT MUM.

 Issue whether the amount charged as excise duty in the debit side of profit and loss account constituted cost of manufacture and absorbed by sale value depicted in credit side of that account bars the refund claim by doctrine of unjust enrichment and deniable referred to President... Advance Steel Tubes Ltd vs CCE - 2013 TIOL 1164 CESTAT DEL.

 Issue as to whether the goods manufactured under loan licence agreement by other manufacturers are to be clubbed with goods manufactured in factory of loan licencee for purpose of Notification 08/2003 CE referred to third member... Optho Remedies Pvt Ltd vs CCE - 2013 TIOL 1257 CESTAT DEL.

 The decision of Delhi High Court scrapping service tax on reimbursements under Rule 5 (1) is not applicable for the period prior to 2006... Shri Krishan Kumar vs CCE - 2013 TIOL 1155 CESTAT DEL.

 Appellant entering in to agreements with various parties for establishing schools in collaboration with permission to use its name, logo and motto etc against payment of fixed consideration amounts to provision of 'Franchise Service'... Delhi Public School Society vs CST - 2013 TIOL 1282 CESTAT DEL.

 Substantial benefit of refund of service tax paid on input services used for export of goods cannot be denied when the requirements specified under the statute can be verified through documents available otherwise... Meridian Apparels Ltd vs CCE - 2013 TIOL 1280 CESTAT MAD.

 Value of material used in course of tyre retreading not entitled for exemption under Notification 12/03-ST in view of LB decision in Aggarwal Colour Advance Photosystem... Laxmi Tyres vs CCE - 2013 TIOL 1261 CESTAT MUM.

 Rule 5 (1) struck down by Delhi High Court as ultra vires of Section 67 cannot be releid on by adjudicating authority for confirming demands against assessees... Maltex Malsters Ltd vs CCE - 2013 TIOL 1210 CESTAT DEL. 

before parting...


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