Chartered Accountant
Bookmark and Share
click here to subscribe our newsletter
 
 
Corporate News *  Missing seized records must be considered while testing ITC claim; duplicate GST demands ordered corrected: Delhi High Court. *  GST appeal can’t be rejected without addressing taxpayer’s grounds: Allahabad High Court. *  Surplus IGST credit can offset CGST, SGST shortfall: GSTAT. *  GST refund can’t be denied when cancelled airfares are returned with tax: GSTAT. *  3 Hearing notices issued within 2 minutes: Gujarat High Court flags portal flaw, seeks report. *  GSTR-9, GSTR-9C filing for FY 2025-26 enabled; pending GSTR-1 and GSTR-3B must be filed first. *  Dupattas are exempt fabrics, can’t be taxed as fibres at 4%: Madras High Court. *  Full transitional credit allowed on capital goods received after GST rollout: GSTAT denies Rs. 6.99 lakh export duty credit. *  GST return mismatch alone can’t justify fraud proceedings: GSTAT orders fresh adjudication under section 73. *  Supplier found non-existent later can’t alone justify input tax credit denial: GSTAT. *  GST interest stops once tax reaches government account, can’t run until return filing: GSTAT. *  Cancelled flat booking- GST refund can’t be denied without excluding COVID period from limitation: GSTAT. *  India notifies rules of origin for India–New Zealand FTA. *  Incomplete E-bike kits classifiable as complete vehicles, but not eligible for CKD duty concession: CESTAT. *  Same GST rate on main input and output can’t by itself bar inverted duty refund: GSTAT. *  Unjust enrichment doesn’t apply to customs refunds from assessments finalised before July 13, 2006: Gujarat High Court. *  CENVAT credit can’t be denied solely because plant And machinery are embedded in earth: Karnataka High Court. *  DFIA exports ineligible for RoDTEP benefits; customs directs repayment with applicable interest. *  Second E-Way bill alone doesn’t prove another supply: GSTAT. *  Bail denied in Rs. 1.19 crore fake GST refund case over risk of accused absconding again: Punjab and Haryana High Court. *  GST registration can be restored after revocation deadline if outstanding dues are paid: Gauhati High Court. *  Multiple GST proceedings over same suppliers: Calcutta High Court directs dept. to share findings for adjudication. *  E-Governance portal services not OIDAR, fixed deposit interest not taxable: CESTAT. *  Rs. 500 Stamp duty required on authority letters for CAs, CMA and GST practitioners in Pune GST division.  *  Rs. 1.10 crore GST refund must be paid in cash after business closure: Allahabad High Court. *  Godown rent attracts 18% GST even when used exclusively for exempt agricultural warehousing: AAR. *  GST portal launches "Multi-State Registration" facility: one master TRN for registration applications across multiple States/UTs. *  RoDTEP scheme extended till 31st December, 2026.  *  Mere disagreement with order can’t override Rs. 20 lakh appeal limit: GSTAT. *  Customs interest can’t be backdated before confiscation liability is determined; nearly 8 year period excluded: Delhi High Court.
Subject News *  GST summons: anticipatory bail maintainable without arrest order, but relief denied in evasion case: Allahabad High Court. *  GST Appeal can’t be decided without hearing taxpayer’s objections to fresh evidence: Allahabad High Court. *  GST ITC can’t be reversed merely because supplier grants discount without reducing tax liability: GSTAT. *  Mere quoting of GST provision is not a valid charge: GSTAT quashes ITC denial. *  Personal hearing mandatory before adverse GST order, even without taxpayer’s request: Rajasthan High Court. *  Parallel bail pleas without full disclosure amount to abuse of process Rs. 43.08 crore GST case sent for fresh hearing: Supreme Court. *  GST refund based on unchallenged advance ruling can’t be recovered using later circular: GSTAT. *  Payment of GST alone doesn’t end interest and penalty liability when tax and interest remain unpaid beyond 30 days of notice: GSTAT. *  GST demand over builders’ 80% procurement rule requires reasoned adjudication: GSTAT. *  Eligible ITC doesn’t automatically entitle taxpayers to compensation cess refund on domestic sales: GSTAT. *  GST confiscation order passed before reply deadline invalid: GSTAT. *  GST interest can’t be retained after tax refund on delayed export receipts: Punjab & Haryana High Court. *  GST appeal can’t be dismissed over pre-deposit shortfall without opportunity To respond: Bombay High Court. *  DGGI SCN can’t be challenged before reply and adjudication:Chhattisgarh High Court. *  GST input tax credit can’t be denied solely due to supplier’s retrospective registration cancellation: GSTAT. *  GST notice must explain fraud allegations; merely repeating section 74 Is not enough:  Himachal Pradesh High Court. *  Audit detection alone can’t justify GST fraud penalty; specific suppression must be proved: GSTAT. *  GST order uploaded only under ‘Additional Notices’ tab without separate intimation set aside: Calcutta High Court. *  Service Tax appeal can’t be rejected for missing pre-deposit proof when payment is already recorded: CESTAT. *  SGST dept. can’t hear appeal against CGST order: Calcutta High Court. *  Mere dispatch of tax order can’t prove service or make appeal time-barred: CESTAT. *  Dealer incentives can’t be taxed merely on ledger entries: CESTAT. *  DGFT orders quashed for failure to supply DRI letter relied upon in SCN: Bombay High Court. *  GST penalty u/s 122(1A) can’t apply to Pre-2021 transactions; unregistered beneficiaries also covered: Delhi High Court. *  Expired E-way bill caused by wrong PIN code can’t justify GST penalty without intent to evade tax: GSTAT. *  Used railway rails can’t be taxed as track material without proof they are fit for reuse: CESTAT. *  Earlier DGGI notice doesn’t bar separate GST demand on different issue: Delhi High Court. *  ITC dispute involves no question of law: GSTAT directs appeal to Vice-President. *  Earlier DGGI notice doesn’t bar separate GST demand On different issue: Delhi High Court. *  No E-way bill required for interstate goods movement in november 2017: GSTAT quashes detention and penalty.  

Comments

Print   |    |  Comment

PJ/Case Laws/2012-13/1426

Judicial discipline should be followed by lower authorities to avoid unnecessary litigation.
 

Case:- MAHINDRA HINODAY INDUSTRIES LTD Vs COMMISSIONER OF CENTRAL EXCISE, PUNE-I

Citation:- 2013-TIOL-212-CESTAT-MUM

Brief facts:-The appellant are manufacturers of excisable goods falling under Chapter 37, 84 and 87 of the Central Excise Tariff. They sent out various types of cast articles for job work to various job workers for the purposes of machining/fettling, bending, or carrying out any other operation necessary for the manufacture of final product. The finished goods are removed from the premises of the job workers and directly sent to the customers in terms of the permission granted to them under Rule 4(6) of the CENVAT credit Rules, 2004. The aforesaid permission was granted subject to undertaking given by the appellant that the waste and scrap if generated at the job workers end would either be brought back or removed on payment of Central Excise duty from the premises of the job workers. During the scrutiny of records of the appellant's factory, it was noticed that they had failed to pay excise duty on waste and scrap generated at the job workers premises.Accordingly, two show-cause notices were issued proposing to recovery Central Excise duty under the provisions of Section 11A of the Central Excise Act for having contravened the provisions of Rule 4(6) of CENVAT credit Rules, 2004 and Trade notice no. 38/02 dated 10.6.2002 issued by the Commissioner of Central Excise, Pune, proposing to recover interest on the said amount under Section 11AB of the Central Excise Act and also proposing to impose penalty under Rule 15 of the CENVAT Credit Rules. The case was adjudicated by the Jurisdictional Asst. Commissioner who vide order dropped the proceedings initiated under the aforesaid show-cause notices in term of the judgment of this Tribunal in Preetam Enterprises vs. CCE 2004 (173) ELT 26 =(2005-TIOL-1256-CESTAT-MUM)and Rocket Engineering Corporation Ltd. vs. CCE 2005 (191) ELT 483 = (2005-TIOL-1313-CESTAT-MUM), the liability - to discharge duty on waste and scrap is on the job workers who are the manufacturers and not on the supplier of materials. The adjudicating authority also relied on the circular of the Board S/267/28/06 CX dated 18.6.2008, wherein, it was clarified that there was no liability on the principal manufacturer to pay duty on scrap generated at the job workers' premises after 31.3.2000. Against the said order the department filed appeal before the Commissioner (Appeals) on the ground that in terms of the permission given by the Asst. Commissioner under Rule 4(6) of the CENVAT Credit Rules, 2004, the appellant had given an undertaking that they would discharge the duty liability on waste and scrap generated at the job workers' premises in case they failed to bring back such waste and scrap. Therefore, in term of the undertaking given, the appellant are liable to discharge duty liability on waste and scrap generated at the job workers' premises. The ld. lower appellate authority accepted the plea of the department and set aside the order of the lower adjudicating authority and held that the appellants are liable to pay excise duty on the waste and scrap generated at the job workers' premises in terms of undertaking given by them under Rule 4 of the CENVAT Credit Rules, 2004. Aggrieved by the said order appellant filed appeal before Tribunal.

 

During the pendency of the appeal, and in consequence to the order of the order of Commissioner (Appeals) the adjudicating authority reassessed the show-cause notices and confirmed the demand against the appellant. The said order was challenged by the appellant before the Commissioner (Appeals), who confirmed the adjudication order. Against the said order, the appellant filed appeal before the Tribunal.

Appellant’s Contention:-The appellant submitted that the order of the Commissioner (Appeals) wherein the order of dropping the demand by the adjudicating authority was set aside was in challenge before this Tribunal. Therefore, no action would have been warranted by the adjudicating authority till the final disposal of the appeal by this Tribunal. He further submitted that although the adjudicating authority passed another order in the show-cause notices which was not required and same was challenged before the Commissioner (Appeals) and before the Commissioner (Appeals), the appellant prayed that operation of the Commissioner (Appeals)'s order has been stayed by this Tribunal vide order, but the Commissioner (Appeals) in spite of keeping pending proceedings, passed the impugned order. The appellant further submitted that this Tribunal set aside the order of the Commissioner (Appeals). In view of this, the proceedings initiated by the adjudicating authority as well as the first appellate authority in the impugned order are not required at all. Therefore, impugned order be set aside.

 

Reasoning of judgment:-  The Tribunal heard both the parties and considered that two show-cause notices were issued to the appellant for demand of duty on clearance of waste and scrap generated at the end of the job worker during the impugned period. Proceedings against both show-cause notices were conducted by the adjudicating authority and the adjudicating authority dropped the show notices. The said order was challenged by the revenue before the Commissioner (Appeals) who passed the following order:

"I allow the appeal and set aside the order of the original adjudicating authority."

In the said order, there was no direction given by the Commissioner (Appeals) for re-adjudication of the show cause notices. Despite that the adjudicating authority in over-enthusiasm re-adjudicated the show-cause notices and passed the order confirming the demand against the appellant despite the facts that it was brought to the notice of the adjudicating authority that the appeal has been filed before this Tribunal against the order of the Commissioner (Appeals). The adjudication order was further challenged before the Commissioner (Appeals) and before the Commissioner (Appeals), the appellant submitted that the operation of the order has been stayed by this Tribunal. Despite that the Commissioner (Appeals) disposed of the appeal instead of keeping the appeal pending.

 

The Tribunal further finds that the action of both authorities, i.e. adjudicating authority and Commissioner (Appeals) are not appreciable. Moreover, when there is no direction for re-adjudication by the Commissioner (Appeals), and appeal against the order of Commissioner (Appeals) is pending before this Tribunal, the adjudicating authority dared to pass the impugned order. Further, the Commissioner (Appeals) has also not bothered about the stay of operation of the order by this Tribunal. This shows that the officers of the department have no respect for the orders passed by this Tribunal and they are following their own law which results in unnecessary litigation before this Tribunal. In this case, till disposal of the appeal against the order by this Tribunal, the litigation could have been avoided but both the lower authorities chose to continue unnecessary litigation. The action of both the lower authorities is not appreciable at all. With these observations, Tribunal finds that neither re-adjudication nor any order was required to be passed by the Commissioner (Appeals) till the final disposal of the appeal by the Tribunal.

 

Decision-: The impugned order is set aside and the appeal is allowed with consequential relief.

 

Comment:-The substance of this case is that it is commonly observed that orders against the assessees are passed without considering the opinions expressed by the higher judicial forums leading to unnecessary litigation.

 
 
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