Chartered Accountant
Bookmark and Share
click here to subscribe our newsletter
 
 
Corporate News *   CBIC issues draft rules for Customs valuation *  Top Headlines: Threshold for Benami deals, green bond investors, and more *  Govt aims 1-hour clearance for goods at all ports *  Exporters Allowed To Use RoDTEP, RoSCTL Scrips To Pay Customs Duty, Transfer Them; Rules Amended *  Millions of labourers to be affected by brick producers’ strike over hike in GST, coal rates *  Inauguration of ‘kendriya GST parisar’ *  Transporter can seek Release of Conveyance alone, not Goods under GST Act: Madras HC *  GST: Quoting of DIN Mandatory for Responding to Notice, Govt Modifies Portal *  Firms can soon file claims for GST credits of ?400 cr *  CBIC issues modalities for filing transitional credit under GST. *  Mumbai: Man creates 36 fake GST firms, arrested for input tax credit fraud of Rs 23 cr *  Report to restructure Commerce Ministry under study; idea is to set up trade promotion body: Goyal *  Firms can soon file claims for GST credits of ?400 cr *  Gambling Alert! Govt May Levy Up To 28% GST; UP, Bengal Back Move *  EPFO backs raising retirement age to ease pressure on pension funds *  India Moving Up Power Scale, Set to Become Third Largest Economy By 2030 *  Airfares Get Expensive: What Changes for Flyers From Today? *  IRCTC Latest News: Passengers to Pay More For Cancelling Confirmed Rail Tickets Soon. *  IBC prevails over Customs Act, says Supreme Court. *  As GST enters sixth year, a time for evaluation and reassessment *  There’s GST on daily essentials as Centre needs money to buy MLAs: Arvind Kejriwal *  Now, GST on cancellation of confirmed train tickets, hotel bookings *  GST kitty for top States could rise 20% in FY23, says Crisil *  French customs officials seize another cargo vessel over Russia sanctions *  TradeLens builds on Asia momentum with Pakistan Customs deal *  Hike tax on tobacco, reduce affordability & increase revenue: Civil society organizations to GST council *  Bihar: ?10 crore tax evasion on tobacco products detected in raids *  Centre failed on GST, COVID; would it be anti-national? Rajan on Infosys row *  Service Tax not Chargeable on Income Tax TDS portion paid by recipient: CESTAT grants relief to TVS *  Foreign portfolio investors make net investment of Rs 7575cr in Sep so far
Subject News *  Run-up to Budget: Monetary threshold for GST offences may rise to Rs 25 cr *   GST (Tax) E-invoice Must For Businesses With Over Rs 5 Crore Annual Turnover *   Both Central GST and excise duty can be imposed on tobacco, rules Karnataka high court *   CBIC Issues Clarification On Extended Timelines For GST Compliance *   CBIC Issues Clarification On Extended Timelines For GST Compliance *  Budget 2023- 9.6 crore gas connections *  GST: Tamil Nadu Issues Instructions for Assessment and Adjudication Proceedings *  GST: CBIC Extends Last Date for filing of ITC *  GST collection in September surpasses Rs 1.4 lakh crore for straight seventh time *  Dollar smuggling case: Customs chargesheet names M Sivasankar as key conspirator. *  Hike in GST rates fuels inflation *  Assam: CBI arrests GST commissioner in Guwahati *  GST fraud worth ?824cr by 15 insurance Cos detected *  India proposes 15% customs duties on 22 items imported from UK *  Decriminalising certain offences under GST on cards *  Surge in GST collections more due to higher inflation: India Ratings *  MNRE Notifies BCD and Hike in GST Rates as ‘Change in Law’ Events But With a Condition | Mercom India *   Solar projects awarded before customs duty change allowed cost pass-through *  Rajasthan High Court Dismisses Writ Petitions Challenging Levy Of GST On Royalty *   GST revenue in September likely at Rs 1.45 lakh crore *  Govt working on decriminalising certain offences under GST, lower compounding charge *  Building an institution like GST Council takes time, trashing is easy: Sitharaman *  GST collections in Sept may touch ?1.5 lakh crore *  KTR asks Centre to withdraw GST on handlooms *  After Gameskraft, More Online Gaming Startups To Receive GST Tax Claims *  Madras HC: AAR Application Filed Under VAT Does Not Survive After GST Enactment *  Threshold for criminal offences under GST law may be raised *  Bengaluru: Gaming company faces biggest GST notice of Rs 21,000 crore *  CBIC clarifies Classification of Cranes for GST, Customs Duty *  Customs seize gold hidden in bicycle in Kerala airport  

Comments

Print   |    |  Comment

PJ/Case Laws/2011-12/1563

Cenvat Credit - admisibility of when job-worker paid duty even though eligible for Exemption u/Notf No. 8/2005-ST - stay granted

Case: M/s RAYMOND UCO DENIM PVT LTD. Vs. COMMISSIONER OF CENTRAL EXCISE, NAGPUR
 
Citation: 2012-TIOL-272-CESTAT-MUM
 
Issue:- Service tax paid by job worker who was eligible for availing exemption under Notification No. 8/2005-ST but did not avail the same – admissibility of credit credit when no action taken by Revenue – prima facie, matter in favour of assessee.
 
Whether credit is available for service tax paid on courier service employed for transportation of ‘samples’ to various customers? – no evidence produced showing courier expenses part of price of samples – pre-deposit ordered.
 
Brief Facts:- The demand of Rs. 395771/- is confirmed against the Applicant in respect of Cenvat credit of service tax paid by job work. The demand of duty is on the ground that as per Notification no.08/2005-ST, the job worker is not required to pay service tax on the process undertaken by them. So, as the job worker has wrongly paid the service tax the applicants are not entitled to take credit. The Revenue has accepted the duty paid by the job worker and no proceedings were initiated against the job worker. The demand of Rs.9416769/- is confirmed after denying the credit of service tax paid on Courier services used for transportation of samples of finished goods from the place of removal to buyer premises.
 
Applicants filed this application for waiver of pre-deposit of duty of Rs.9812540/-, interest and penalty.
 
Appellant’s Contention:- The contention of the applicants is that the applicants are manufacturing certain qualities/ types of denim fabrics which were sent to various customers as samples through couriers. The contention is that as the samples were cleared on payment of appropriate duty which have been sent through courier services therefore, the courier service received is in or in relation to their final product.
 
They also submitted the show cause notice was issued demanding duty for the period 1.1.2005 to 31.8.2009.The contention is that they were regularly returns showing taking credit of service tax paid on courier services. The show cause notice is issued by invoking extended period of limitation on the ground of suppression of facts with intent to evade payment of duty. As the applicants were filing regularly returns for taking credit of service tax paid on courier services and also showing utilisation of credit, therefore, the allegation of suppression with intent to evade payment of duty is not sustainable.
 
Respondent’s Contention:- The contention of the revenue is that some period of dispute is within the normal of limitation. It is also submitted that the place of removal as defined under sec.4 of the Central Excise Act, 1994 is a factory or any other place of production of goods and in the present case, the courier service is received after the clearance of goods from the factory gate therefore, the service relates to post clearance of the samples and nothing to do with the manufacture of samples. Therefore, the credit was rightly denied.
 
Reasoning of Judgment:- The Tribunal noted that the Punjab & Haryana High Court in the case of GUJARAT AMBUJA CEMENT VS. CCE reported in 2009(236)ELT 431 held that the credit of service tax on outward freight is admissible if the same is part of price of goods. In the present case, the applicants had not produced any evidence tp show that the courier expenses are part of the price of the samples. Taking into account the facts and circumstances of the case and also the arguments on the issue of limitation, the applicants are directed to deposit an amount of Rs. 10 lakhs within a period of 8 weeks. On deposit of the aforesaid amount, pre-deposit of the remaining amount of duty, interest and penalty is waived and recovery therefore is stayed during the pendency of the appeal.
 
Decision:- Application disposed off accordingly. 

Department News


Query

 
PRADEEP JAIN, F.C.A.

Head Office : -

Address :
"SUGYAN", H - 29, SHASTRI NAGAR, JODHPUR (RAJ.) - 342003

Phone No. :
0291 - 2439496, 0291 - 3258496

Mobile No. :
09314722236

Fax No. :0291 - 2439496


Branch Office : -

Address:
1008, 10th FLOOR, SUKH SAGAR COMPLEX,
NEAR FORTUNE LANDMARK HOTEL, USMANPURA,
ASHRAM ROAD, AHMEDABAD-380013

Phone No. :
079-32999496, 27560043

Mobile No. :
093777659496, 09377649496

E-mail :pradeep@capradeepjain.com