Leaf No : 50
Month : May
Year : 2014
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Greetings from Team SA!

 Mr. Narendra Modi sworn in as the 15th prime minister of India. 


An assessee engaged in the manufacture of “Flavoured Drink concentrate” classifiable under sub heading 2108.90 of the Central Excise Tariff Act, 1985 had filed a refund claim under Rule 5 of Cenvat Credit Rules, 2002 on 22.12.2003 for Rs.19 lakhs in respect of the unutilized cenvat credit accumulated in their cenvat account on inputs utilized in the export of goods. A show cause notice was issued proposing to reject the refund claim on the grounds of not fulfilling the conditions of notfn.11/02-CE(NT) dt.1.3.02. The refund claim was rejected by the adjudicating authority on the grounds that the assessee could have utilized the credit in respect of the inputs against the goods exported during the period 23.12.2002 to 31.12.2003.

The assessee had preferred an appeal before the Commissioner (Appeals) who held that the assessee should have utilized the credit for the goods exported on payment of duty and if there was no sufficient credit available then the asseseee should have resorted to export without payment of duty and accordingly upheld the order of adjudicating authority.

The assessee preferred an appeal before the Hon’ble CESTAT. The Hon’ble CESTAT based on the facts on record and the arguments put forth by the counsel for the assessee has set aside the order of the Appellate authority with the following observations:

• There was no dispute that the appellants had cleared the goods under bond without payment of duty.
• There was no dispute that the appellants have not availed the drawback or rebate of duty.
• Condition (v) of notification no.11/2000 stipulates that refund is allowed only in those circumstances where a manufacturer is not in a position to utilize the credit of duty on inputs against goods exported during the quarter or month to which claim relates.
• Cenvat credit accumulated cannot be utilized against the clearances of goods for home consumption.
• The principles laid down by the Hon’ble Tribunal in the case of Jenntex Engineering Company Vs CCE Coimbatore 2009 (234) ELT 519 i.e grounds on which refund claim was rejected that the assessee could have exported the goods on payment of duty utilizing credit is a wrong ground and  misdirected.
• Assessee is entitled to claim refund on accumulated credit “where for any reason such adjustment is not possible” as per Rule 5.
• Finding of the Commissioner (Appeals) that the Appellant should have given preference to make use of the credit balance against the goods exported, is erroneous and cannot be sustained.

CESTAT Final Order No.40298/2014 dated 25.4.14


 The Institute of Chartered Accountants of India (ICAI) has launched a ‘Flexi working portal for women members’ to enable them manage their profession and domestic front with ease.

 The Securities and Exchange Board of India (SEBI), proposed a new set of rules, which would require greater disclosures by companies and give more powers to stock exchanges to check any non-compliance.


 Classification of rice par - boiling machinery.

 Differences between duty credit scrips and goods permitted / not-permitted against them under respective FTP paragraphs / Customs Notification.

 Agreement between the India-Taipei Association in Taipei (ITA) and the Taipei Economic and Cultural Center in India (TECC) on the FICCI / TAITRA Carnet for the temporary admission of Goods. (Tariff & Non - Tariff).

 Amendment to Notification No. 62/1994 - Cus.(N.T.) dated 21.11.1994.

 Rate of exchange of conversion of each of the foreign currency with effect from the 16th May, 2014.

 Tariff Value of Gold & Silver increased.

 Regarding increase of the monetary allowance for the officer awarded Presidential Award of Appreciation Certificate for exceptionally meritorious service at the risk of life.



 Re-export of food, medicine and medical equipments to Iran will not be subject to any value addition requirement. Goods imported against freely convertible currencies and re-exported to Iran against rupee payment shall not be eligible for any export incentive.

 MEP on export of edible oils in branded consumer packs of upto 5 Kgs has been reduced to USD 1100 per MT. Earlier it was USD 1400 per MT.

 The structure of Appendix-4D of Handbook of Procedure Vol. I (Appendices and Aayat Niryat Forms) 2009-2014 has been changed.

 Trade Promotion Council of India is enlisted for issuing Certificate of Origin (Non Preferential).


 Supply and installation of lift is 'works contract' and not 'sale' - Kone Elevator India Pvt LTd vs State of Tamilnadu - 2014-TIOL-57-SC-CT-CB.

 Accepting defective compressors outside the warranty period with certain fixed repair charges and replacing them at the option of the customer with any other repaired compressor does not tantamount to sale so as to attract Sales tax - Addl. Commr, Sales Tax vs. Kirloskar Copeland Limited - 2014-TIOL-801-HC-MUM-VAT.

 The non-obstante clause contained in section 22 of the SEZ Act, would have overriding effect to all provisions of State VAT Acts, irrespective of time of incorporation of provisions in State Acts - Torrent Energy Ltd vs State of Gujarat - 2014-TIOL-648-HC-AHM-VAT.

 Manufacture of goods outside State to specifications of customer and delivery within State to customer as finished goods after job-work is a local sale and not inter-state sales - Pearl Sacks (P) Ltd V State of Tamilnadu - 2014-69-VST-519 (Mad).

 Estimation of turnover based on cash receipts found in inspection held valid in absence of claim by dealer that inspection conducted on special days attracting more sales - Nathu Ram Ramesh Kumar Vs Commissioner of Delhi - 2014-70-VST-1 (SC).

 Transfer of right to use goods - Dealer engaged in leasing of cars/motor vehicles entitled to avail of input tax credit of tax paid on purchase of cars - Commissioner of VAT, Delhi Vs Carzonrent India Pvt Ltd - 2014-70-VST-385 (Delhi).


 Rule 6 of Cenvat rules regarding payment of 8% on value of exempted goods not applicable for by-products cleared without payment of duty - UOI vs Hindustan Zinc Ltd - 2014-TIOL-55-SC-CX.

 Issue regarding treatment of ‘depot’ as place of removal during the period prior to amendment of Section in 1998 remanded to adjudicating authority - UOI vs Mahindra & Mahindra - 2014-TIOL-58-SC-CX.

 Interest on delayed refund is automatic and cannot be denied on the ground that the party had given in writing that no interest would be claimed - Siddhant Chemicals vs UOI - 2014-TIOL-676-HC-ALL-CX.

 In case of dismissal of appeal by Tribunal on account of delay, the proper remedy is to file an appeal under Section 35 G of the Central Excise Act - Pawan Enterprise & Another vs UOI - 2014-TIOL-856-HC-GUW-CX.

 Exemption under Notification No. 40/95 for manufacture without power is available when power is used in relation to incidental operations - CCE vs Dhanalakshmi Cloth Dyeing and Printing works - 2014-TIOL-696-HC- AP-CX.

 To claim rebate of duties paid on export of goods, duties will have to be paid at the time of export and not at a later point of time with interest. - Santhar Automobiles vs Joint Secretary - 2014-TIOL-826-HC-DEL-CX.

 Supply of television sets to agency of Tamilnadu Government for free distribution to people is subject to valuation under Section 4A as supplies are not made to an ‘industrial or institutional consumer’ - PG Electroplast Ltd vs CCE - 2014-TIOL-861-CESTAT-DEL.

 Amendment in Rule 2 (l) of Cenvat Rules omitting credit of service tax paid on activities relating to business is not retrospective - JK Cement Works vs CCE - 2014-TIOL-848-CESTAT-DEL.

 Section 66E (i) of the Finance Act, 1994 regarding levy of service tax on Service portion held as valid - Hotel East Park & Anr vs UOI - 2014-TIOL-758-HC-CH-ST.

 Shortfall in depositing 50% tax before 31.12.2013 results in rejection of VCES - Ramilaben Bharatbhai Patel vs UOI - 2014-TIOL-678-HC-AHM-ST.

 When there are two views before the tribunal on a legal point, then, a prima facie case is made out for waiver of pre-deposit - Sheeba Kuries Ltd vs CCE - 2014-TIOL-795-HC-MUM-ST.

 When adjudication order has traversed beyond scope of show cause notice the same can be challenged in writ petition and existence of alternate remedy is no bar for entertaining WP - SMT Ranuka Prasad vs CCE - 2014-TIOL-622-HC-KOL-ST.

 Benefit of Notification 12/03-ST available if assesee is able to show the value of goods from contract read with other documents such as RA Bills and Returns filed with Sales tax Authorities - Space Age Associates vs Union of India - 2014-TIOL-693-HC-MUM-ST.

 Issue whether penalty can be imposed simultaneously under Sections 76 and 78 for period prior to 10.05.08 referred to larger bench  - Industrial Security and Protection Services vs CCE - 2014-TIOL-710-CESTAT-MUM.


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