TaxTMI 
TaxTMI 
2011 (12) TMI 269
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....onn 3.01 2. Urea Product Handling & Begging Wagon Loading-Receiving bags in wagon loading platform through the loader, and loading it into the wagons including the Tally checking. 570102101101 Metric Tonn 6.30 3. Urea Product Handling & Bagging Wagon Loading-Manual direct loading of the wagons wherever the wagon loaders are not reaching-including the tally checking 570102102101 Metric Tonn 6.74 4. Urea Product Handling & Bagging Wagon Loading-Stacking of filled bags on the wagon loading platforms-and loading into the wagons including tally checking 570102103101 Metric Tonn 12.82 5. Urea Product Handling & Bagging Wagon Loading - Loading of the wagon from a distance of 50 feet and above - in case the wagon loading are not available due to maintenance etc . including tally checking. 570102104101 Metric Tonn 15.83 6. Urea Product Handling & Bagging Truck Loading - Loading of trucks/tractors directly-through the truck loader including tally checking 570103101101 Metric Tonn 4.03 7. Urea Product Handling & Bagging Truck Loading - Loading of trucks/tra....
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....ack, tying the seal card, applying lac and putting CFCL siding seal for covered wagons. 570107103101 Per Wagon 10.38 18. Urea Product Handling & Bagging Miscellaneous Jobs- Housekeeping and cleaning of bagging plat, building, silo, conveyor, screenhouse surrounding conveyor, conveyor pantry, shifting of urea lamps, torn bags, packing material etc. to the location marked by CFCL's representative and other related jobs-Godempan-II bagging area. 570107104101 Months 88124 19. Urea Product Handling & Bagging Miscellaneous Jobs- Housekeeping and cleaning of bagging plat, building, silo, conveyor, screenhouse surrounding conveyor, conveyor pantry, shifting of urea lamps, torn bags, packing material etc. to the location marked by CFCL's representative and other related jobs-Godempan-II bagging area. 570107104102 Months 39164 20. Urea Product Handling & Bagging Miscellaneous Jobs- Housekeeping and cleaning of track to keep track free from coal/debris 570107104103 Days 920.00 21. Urea Product Handling & Bagging Miscellaneous Jobs- Manpower assistance for misc. petty jobs. 570107105101 Manday....
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....de belief that the activity, they were doing, was not covered by the entry 'Cargo Handling Services' under Finance Act, 1994 and that is the reason why they did not take registration and pay service tax. They argue that mere failure to make declaration does not amount to mis-declaration or wilful suppression. They argue that a positive act to establish either wilful mis-declaration for wilful suppression is a must for invoking the extended period of limitation of five years prescribed under section 73 of Finance Act, 1994. They rely on the following decisions of the Apex Court: (i) Pahwa Chemicals (P.) Ltd. v. CCE 2005 (189) ELT 257 (SC); (ii) Collector of Central Excise v. Chemphar Drugs & Liniments 1989 (40) ELT 276 (SC). Thus the counsel argues that the demand is not sustainable both on account of merits and on account of time-bar. 6. The Ld. DR, on the other hand places reliance on the contract between the Appellants and the CFCL which shows details of work done as given in the table in para 1 above. He points out that the entries in the table specifying the jobs to be done as specified at S. No. 1 to 11 are clearly jobs relating to loading of "car....
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....lier been dispute regarding classification of this product. On 31st October, 1991 Excise Preventive Officers had intercepted one consignment of the Appellants in transit and seized goods which contained labels of foreign brand name. All the RT-12 returns were being regularly filed. The invoices containing description of the goods have all been regularly approved by the Department. 3. The Appellants have all along claimed that merely because they were affixing the label of a foreign party, they did not lose the benefit of Notification No. 175/8b-C.E. as amended by Notification No. 1/93-C.E. The view taken by the Appellants had, in some cases, been approved by the Tribunal which had held that mere use of the name of a foreign party did not disentitle a party from getting benefit of the Notifications. It is only after Larger Bench held in Namtech Systems Limited v. Commissioner of Central Excise, New Delhi reported in 2000 (115) E.L.T. 238 (Tribunal) that the position has become clear. It is settled-law that mere failure to declare does not amount to wilful mis-declaration or wilful suppression. There must be some positive act on the part of the party to establish either wilful mis....
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....rol. 5. However, on 30th July, 1980 the firm filed a classification list in Respect of P & P medicines claiming exemption under Notification No. 80/80. A show-cause notice was issued to the respondent who was asked to explain as to why excise duty in respect of Patent and Proprietary medicines manufactured and cleared by it should not be demanded under proviso (a) to Rule 10(1) of the Central Excise Rules and why penalty should not be imposed on it under Rule 173Q of the Central Excise Rules, 1944 for having cleared the goods without payment of duty in contravention of Rule 173Q (a) and (d) of the Central Excise Rules." 9.3 In the context of the above facts the findings of the Honourable Court in para 8 of the order is reproduced below: "8. Aggrieved thereby, the revenue has come up in appeal to this Court. In our opinion, the order of the Tribunal must be sustained. In order to make the demand for duty sustainable beyond a period of six months and up to a period of 5 years in view of the proviso to sub-section 11A of the Act, it has to be established that the duty of excise has not been levied or paid or short-levied or short-paid, or erroneously refunded by reasons of ei....
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....ion under Notification No. 55/75, dated 1st March, 1975. By the said notification, the Central Government had exempted goods of the description in the Schedule annexed to the notification and falling under Tariff Item 68 of the First Schedule to the Act from the whole of duty of excise leviable thereon. In the Serial No. 8 of the Schedule to the said notification, 'Handicrafts' were listed. It is, therefore, clear that 'handicrafts' were fully exempt from payment of duty of excise, according to the appellants. Under the Notification No. 111/78, dated 9th May, 1978, the appellants were exempted from licensing control. That is the case of the appellants." 9.5 The sentence underlined in the extracts of the case of Chemphar Drugs & Liniments (supra) and similar observations in the case of Padmini Products (supra) are being pointed out generally to argue that if an assessee does not do anything to discharge his duty/tax liability and simply keeps quite, it is not suppression. The interpretation canvassed is probably that unless the assessee has underground factories it cannot be considered as suppression. In the case of service tax it cannot probably be done under cellars. But it is ....
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....00 of the Central Excise Tariff Act, 1985. Bajaj, the Respondent No. 1, was supplying inputs - aluminum ingots after purchasing the same from other manufacturers to Anurang for the relevant period under the cover of invoices issued under Rule 57F(2) and Rule 57(3) of the Central Excise Rules, 1994, after reversing the MODVAT credit availed on the said input. 3. A show-cause notice dated 5-3-2001 was issued by the Commissioner of Customs and Central Excise, Aurangabad, in which it was alleged that Anurang was receiving inputs from Bajaj at an undervalued landed cost by not including expenses on account of sales tax, octroi, freight, insurance, loading unloading charges and handling charges, and that Bajaj was charging only the basic price of such inputs equal to the basic price charged by the original manufacturers of the said inputs to Bajaj, and since the additional cost of loading-unloading, freight etc. was not included in the input supplied to Anurang, there was consequent reduction in the landed cost of such inputs. It was also alleged that the price charged by Bajaj was depressed price although the same was coloured as negotiated price and the price indicated in the purcha....
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....not declaring what should be declared.) 10. In view of the above facts in each case certain relevant points are to be noted. 10.1 First point is the observation of the Apex Court in the case of para 8 of Chemphar Drugs & Liniments (supra) as under: "Whether in a particular set of facts and circumstances there was any fraud or collusion or wilful misstatement or suppression or contravention of any provision of any Act, is a question of fact depending upon the facts and circumstances of a particular case." 10.2 If there cannot be general rule, the rule of "positive act of suppression" itself cannot be a general rule for reasons as explained below. 10.3 Suppression with intent to evade payment of duty is seldom done by actions leaving trails and therefore the "positive act" that the Apex Court was referring to is not something which can always be demonstrated through existence of a physical thing or document. It is about a state of mind. This is to be judged from the facts of the case. 10.4 All the cases pointed out were with reference to a registered assessee and before self-assessment system came into existence. With the scheme of self-assessment the onus on the pa....
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....tly the matter quite often involves intangibles, which can be seen mainly through concerned contracts or through the outcomes of service. The next issue is that because the levy is not administered by taxing all services and exempting specified services but by a system of taxing specified services. These factors, can in the facts of some cases, persuade a judicial mind to conclude that there was no wilful suppression. 12. Now let us consider the facts of the present case. At least 15 out of the 22 items of work specified are about loading of cargo. Some of the other items of work also have nexus to such cargo handling. The definition of the relevant entry in Finance Act, 1994 covers loading as also of unloading of cargo. By a simple understanding of the matter the activity will be covered by the definition. The question whether loading through automated systems would be covered arises out of a legal interpretation. By simple understanding of the definition if the service is covered it is necessary that the service provider discloses the facts to the department and seeks clarification. If the person concerned just waits for the department to come and knock at his door it is a men....
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....tailed facts already stands recorded in the said order proposed by my learned brother, the same are not being repeated. 16. As regards the merits of the case, I find that the appellants have taken a categorical stand before the authorities below that they have only provided labour/labourers to do the work of sealing of bags and loading and unloading of wagons. As such, they are manpower supplier agency and the entire loading and unloading or packing work is fully mechanized. They have further submitted that automatic filling machine and conveyor carries bags and loader machines are in the ownership of CFCL and they have no control on the said machinery. Packing and loading activity was, in fact, continuous process to the manufacturing of Urea and the labourer provided by the appellant were just overseeing and guiding these activities. Automatic machine itself fills the bags, the conveyor carries bags up to and into the railway wagon and or through loader machine the bags were loaded on the trucks. It is only when the loader machines are not reaching to the trucks, the work was carried out manually. They have specifically contested that they have only supplied the manpower to do ....
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....sioner, I find that he has not discussed the issue of limitation. It is only in the context of imposing penalty under section 78 of the Finance Act that he has observed that the assessee had wilfully suppressed the fact for providing services to the customers with intention to evade payment of service tax and as such they are liable to penalty under the said section. Similarly, I find that the Commissioner (Appeals) has also not given any finding on issue of time bar, though this specific ground, was raised in the memo of appeal. 20. Learned Advocate appearing for the applicant has strongly contested the demand on the point of limitation by submitting that the extended period of limitation is available to the Revenue in case fraud, collusion, misstatement or suppression of facts or contravention of any provisions with intention to evade payment of duty. Neither of the lower authorities have referred to any evidence attributable to the appellants so as to give finding of suppression or misstatement against them with intention to evade payment of duty. It stands strongly contended before us that merely non-intimation to the Revenue about existence of the appellant and about the fa....