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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.  

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PJ/Case Laws/2012-13/1356

Whether non authorisation by port be a ground for rejecting refund claim even after amendment in definition of port services?

Case:- COMMR. OF C. EX., AHMEDABAD VersusHEMLINES TEXTILE EXPORTS PVT. LTD
 
Citation:-2012 (279) E.L.T. 425 (Tri. - Ahmd.)

Brief facts:-The respondent M/s. Hemlines Textile Exports Pvt. Limited, a manufacturer of made-up articles under Chapter 63, filed two claims for refund of service tax paid on taxable services utilised for export of goods, in terms of Notification No. 41/2007-S.T., dated 6-10-2007. The claims were partly rejected vide OIO dated 30-10-2009 and dated 29-1-2010. The details are as under :-
 

Period for which refund claimed Amount of refund claimed (Rs.) Taxable Services involved OIO dated
October to December, 2008 2967/- 3589/- CHA Service Port Service dated 30-10-2009
January to March, 2009 8156/- 9023/- CHA Service and Port Service dated 29-1-2010

 
The respondents filed appeal against the orders rejecting the refund of tax on Port services. The Commissioner (Appeals) held that with enactment of Finance Act, 2010 on 8-5-2010, the definition of Port service has been amended and now no authorization from the airport/Port authority would be required for taxing these services. Quoting the DO letter No. F. No. 334/1/2010-TRU, dated 26-2-2010, the Commissioner (Appeals) held that the amendment has clarified the coverage of these services and there is no change in the scope of the definition. Hence, the Commissioner (Appeals) allowed the refund. Aggrieved by the order, Revenue is in appeal.
 
Appellant contentions: The appellantsubmits that according to definition of Port service given in Section 65(82) of the Finance Act, 1994, any service rendered by Port or other Ports, any person authorized by such port or other port in any manner in relation to vessels or goods. Therefore, unless the service provider was authorized by the port, the service cannot be considered as port service. The reliance of the Commissioner on the amended definition and the clarification issued by the Board is not correct.
 
Respondent contentions:- In the written submissions the respondent submitted that in the Notification No. 41/2007-S.T. there is no condition that service tax paid on port services cannot be refunded on the ground that authorization of port is not furnished. It is also submitted that amendment is clarificatory in nature.
 
Reasoning of Judgment:-Tribunal has found that services have been provided by the agent M/s. DHL Lemuir Logistics Pvt. Limited who in turn has been provided the service from the Port or persons authorized by the Port; that this is permissible in terms of Rule 5(2) of the Service Tax (Determination of Value) Rules, 2006. Basically, the submission is that the service was not really provided by the persons who issued the receipts but they received the service on behalf of the respondents. In view of the clear observation that service has been provided by the service providers authorized by the Port, impugned order has to be sustained. In any case, rejection of refund claimed by the respondents would amount to reassessment of the service at the receiver’s end. What is required to be seen for sanctioning of refund is, whether service tax has been paid or not; whether service has been used or not and whether service falls in the services covered by the notification or not. Once these three aspects are satisfied, the officer sanctioning the refund cannot go into other issues to reject refund claimed.
 
Decision:-Appeal Rejected.
 
Comment:-  The analogy drawn from this case is that refund claim to exporters should not be withhold on unnecessary grounds such as non authorisation by port when the definition of port services has been amended and moreover, service tax has been paid and the said service has been used for the purpose of exporting goods and is covered by the notification granting refund.  
 

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