Chartered Accountant
Bookmark and Share
click here to subscribe our newsletter
 
 
Corporate News *  Service tax penalty can’t survive when assessee acted on dept.’s own view of non-taxability: Delhi High Court. *  GST section 74 extended limitation questionable when form 26AS mismatch was already known: Karnataka High Court grants interim relief. *  CGST demand prima facie impermissible after state GST settlement under section 128A: Bombay High Court. *  Supreme Court asks GSTAT to sympathetically consider delay as taxpayers pursued remedy before wrong forum. *  Supreme Court stays Tripura High Court ruling protecting genuine buyers from ITC denial over supplier’s GST default. *  Diary entries alone can’t prove clandestine removal of goods: CESTAT quashes excise penalty on steel trader. *  Customs could investigate preferential tariff claims even before sec. 28DA: Delhi High Court. *  Customs dept. relied on fake AI generated case laws: supreme court quashes Rs. 425.28 crore penalty. *  No GST exemption in affiliation and annual registration charges for admission or conduct Of examinations: GSTAT. *  Mere invoices, cheque payments insufficient to establish genuine movement of goods: GSTAT restores Rs. 43.44 lakh ITC demand. *  Consolidated GST show cause notice covering multiple financial years is not without jurisdiction: Delhi High Court. *  Construction of independent houses on separate plots not taxable as ‘Residential Complex’ without common facilities: CESTAT. *  GST penalty exceeding statutory maximum unsustainable; Allahabad High Court quashes ? 50,000/- penalty after taxpayer filed return and paid late fee. *  GST order against standard chartered bank passed without hearing set aside by Bombay High Court. *  Retracted statements can’t be relied upon without cross-examination: CESTAT quashes gold confiscation. *  Burden to prove misclassification lies on customs department: CESTAT. *  CESTAT quashes Rs. 98 lakh excise demand on clearance of used refractory brick scrap. *  Service tax demand on irrigation works quashed: Karnataka High Court rules sale of goods component not taxable as service. *  GSTAT restores tax and penalty for transporting iron scrap without E-way bill citing intent to evade tax. *  Madras High Court stays GST recovery from directors without opportunity to show cause under section 89. *  Madras high court stays GST recovery notice against directors; finds prima facie case on applicability of section 79(1)(c). *  Procedural lapses can’t justify harsh punishment without serious customs breach: CESTAT quashes customs broker licence revocation. *  Service tax payable on land leasing and sports complex charges: CESTAT. *  Settled customs dispute can’t be reopened through Article 226 challenge to interest liability: Delhi High Court. *  Mere facilitation of customs clearance can’t establish knowledge of smuggling: Madras High Court. *  GST registration cancellation stayed: Allahabad High Court questions 99% ITC utilisation cap under rule 86B. *  Composition scheme lapses automatically on crossing Rs. 1.5 crore turnover: GSTAT. *  Gujarat High Court quashes GST cancellation orders after officer relied on non-existent AI-generated case laws. *  Importers liable for customs duty benefits availed through manipulated scrips: Delhi High Court. *  Procedural E-way bill lapse alone can’t justify penalty where genuine transaction and absence of tax evasion are established: GSTAT.
Subject News *  Documentary evidence dominates probe, further custody unwarranted: mumbai court grants bail in Rs. 22.44 crore customs duty evasion case. *  Business premises can’t remain sealed for non-participation in GST search: Allahabad High Court. *  GST pre-deposit must be refunded proportionately when taxpayer partly succeeds in appeal: Bombay High Court. *  Supreme Court grants 30 days to file GST appeal; keeps pre-deposit issue open due to deposit in parallel CGST proceedings. *  GST demand can’t exceed amount proposed in SCN: Allahabad High Court quashes Rs. 20.47 Crore order. *  Hundreds-of-crores GST demand and heavy 10% pre-deposit no ground to bypass statutory appeal: Punjab & Haryana High Court. *  Delhi High Court refuses to entertain challenge to gold confiscation due to statutory appeal remedy and unexplained delay. *  Procedural error in customs broker licence inquiry can be rectified through remand: Delhi High Court. *  GSTR-2A mismatch alone can’t justify ITC denial without invoice-wise verification; personal hearing mandatory: GSTAT. *  GST order passed without uploading personal hearing notices violates sec. 75(4): Allahabad High Court. *  TAX EVASION - Sec. 74 GST SCN quashed for not spelling out fraud, wilful misstatement or suppression: Allahabad High Court. *  STPI’s SOFTEX certification and NoC charges taxable as business support services: CESTAT. *  Suspicion can’t replace proof: CESTAT quashes penalty in alleged gold-smuggling operation. *   Limitation runs from communication of order: Madras High Court upholds rejection of delayed GST Appeals. *  Rajasthan High Court quashes GST demand over unsigned show cause notice. *  ITC recovery upheld where supplier failed to deposit GST: Rajasthan High Court. *  Customs commissioner’s empowered to make port trust liable for duty on pilfered goods: Supreme Court. *  Rectification proceedings can’t be used to challenge an uncontested GST assessment through a writ petition: Andhra Pradesh HC. *  GST proceedings against deceased proprietor unsustainable without notice to legal heir: GSTAT. *  Mere availment of ineligible self-assessed ITC doesn’t amount to suppression without evidence of fraud or wilful misstatement: GSTAT. *  Disposal of mining overburden by entity authorised by mining lease holder constitutes taxable service: CESTAT. *  Toll plaza data not mandatory for ITC refund: GSTAT. *  Disputed GST fraud allegations require investigation: Punjab and Haryana High Court makes interim bail absolute in alleged fraud and GST fraud case. *  Non-manufacturer contractor liable to deposit excess excise duty collected from buyer: CESTAT. *  GST order can’t reject taxpayer’s reply as “not satisfactory” without reasons: Madhya Pradesh High Court. *  Uncorroborated statements can’t establish alleged diversion of duty-free goods: CESTAT. *  Erection services were not liable to service tax prior to 10th september 2004: CESTAT. *  Sec. 74 GST notice must spell out statutory ingredients for invoking extended tax demand proceedings: Allahabad High Court. *  No jurisdictional bar under section 6(2)(b) in parallel CGST SGST proceedings: Delhi High Court refuses to bypass GST appeal remedy. *  Madras High Court remits GST demand for fresh adjudication after taxpayer claims it was unaware of SCN following business closure.  

Comments

Print   |    |  Comment

PJ/CASE LAW/2015-16/2882

Denial of cenvat credit on the inputs without sound allegations.

Case:- COMMISSIONER OF C. EX. & CUS., AURANGABAD VERSUSINDIA CONTAINERS LTD.
 
Citation:- 2015 (321) E.L.T. 473 (Tri. - Mumbai)
 
Brief facts:-This appeal is directed against the Order-in-Original No. 03/CEX/2000, dated 14-2-2000 vide which the adjudicating authority has set aside the demand of the duty of Rs. 27,91,555/-.
The respondent is absent despite notice. Since the issue is of 2001, they take up the appeal for disposal in the absence of any representation from the respondents.
The issue involved in this case is regarding denial of Modvat credit/Cenvat credit to the appellant on the inputs which were received by them and it was alleged that the said inputs could not have been used by the respondents for the manufacture of final products. The more specific allegations are that the respondents had procured inputs i.e. Tin Sheets/Tin Plates of which no thickness was mentioned on the invoices. It was further alleged that respondent could not have used tin plates of thickness of more than 0.24 mm. The adjudicating authority after considering the evidences produced before him came to the following conclusion -
“as regards to the amount mentioned in Annexure “B-3” of show cause notice for an amount of Rs. 27,91,555/-, the show cause notice itself do not specify the thickness therefore the allegations against the assessee are not sustainable and the remand to this extent cannot be confirmed”.
The adjudicating authority on the above findings set aside the demand raised on the respondent for the amount. The revenue is in appeal against such setting aside of the demand.
 
Appellant’s contention:- The ld. DR took them through the entire show cause notice and also through Annexure “B-3” to the said show cause notice. It is his contention that it was for the assessee to lead evidence as regards the thickness of the said tin plates for availing Modvat credit/Cenvat credit. It is his submission that the assessee never disputed that the invoices did not have thickness of the tin plates mentioned on them. He submits that the absence of non-mentioning of thickness on the invoices, it has to be presumed that the assessee has not used the tin plates received by him under invoices as mentioned in the said annexure.
 
Respondent’s contention:- None appeared on behalf of respondent.
 
Reasoning of judgment:- Considered the submissions made at length by the ld. DR and perused the records. It is seen from the records that the appellant has been receiving tin plates of various thickness for manufacturing of cans. The allegation in Annexure “B-3” to show cause notice is categorical, in as much that the credit is sought to be denied on the ground that the thickness of the tin plates is not mentioned. There were various allegations against the appellant and confirmation of the duty in respect of another allegations regarding credit availed on tin plates having thickness ranging between 0.24 mm to 0.45 mm and thinner. The adjudicating authority in the very same order-in-original had held that the appellant could not have used the tin plates which were having thickness ranging between 0.30 mm and thinner and 0.45 mm and thinner. Against the said confirmation of demand, the assessee came in appeal before the Tribunal in appeal No. E/1369 to 1372/2000. The Tribunal vide its Order No. C-I/551-554/WZB/2003, dated 28-2-2003, in respect of the allegations in Annexure “B-2” held as under” -
(b)Credit availed on tin plates having thickness ranging between 0.30 mm & thinner to 0.45 & thinner amounting to Rs. 23,87,575/-.
We have perused Annexure B.2 for this demand and accept the appellants’ contention that the description of inputs in this annexure can also cover inputs (tin sheets/tin plates) below 0.24 mm in thickness, particularly in the absence of any independent findings that these inputs were found to be of thickness in excess of 0.24 mm. We, therefore, set aside this demand as unsustainable”.
It can be seen from the above reproduced order of the Tribunal, that the credit of the duty, as plates having thickness of 0.30 mm and thinner 0.45 mm and thinner, were available to the assessee. In the current appeal by the Revenue before them, the case of the assessee is on a stronger footing. The allegation of the show cause notice itself does not enthuse confidence that the assessee could not have used the tin plates as mentioned in Annexure “B-3”. There is no allegation in the show cause notice that the respondent had not received the said tin plates as mentioned at Annexure”B-3”.
As such, they find that the very same order-in-original in respect of an identical allegation has been set aside by the Tribunal in the respondent’s own case. Respectfully, following the same, they find no merits in the appeal filed by the Revenue. The appeal is rejected.
 
Decision:- Appeal rejected
 
Comment:- The essence of the case is that cenvat credit cannot be denied unless there is no evidence of inputs having not been received or used in manufacture. At the time of issuance of show cause notice nothing is mentioned of thickness in show cause notice and credit is being denied solely on the ground that the assessee could not have used tin plates of thickness of more than 0.24 mm. The allegation of the show cause notice itself does not enthuse confidence that the assessee could not have used the tin plates. Therefore, the credit was allowed.

Prepared by:- Monika Tak 

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