TaxTMI 
TaxTMI 
Orders of Supreme Court, High Courts and CESTAT accepted by the Department and on which no review petitions, SLPs have been filed– reg.
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Courts have decided various questions of law. In the rest forty nine cases the Hon'ble High Courts have delivered judgments on the basis of some settled case law or have decided points of facts or have dismissed the appeal on monetary grounds. The said orders have been complied in this Circular so that cases pending in the field can be expeditiously decided, if the questions of law or facts involved are identical. 2. The Circular has two parts, namely Part I and Part II, where Part I comprises of the orders of various High Courts in which points of law have been decided and Part II comprises orders which have been decided on facts or have been dismissed on monetary limits. All the orders have been accepted by the Department and against them no SLP etc has been preferred in the Hon'ble Supreme Court. 3. This exercise has been undertaken as an endeavour to reduce litigations so that cases on similar questions of law or identical case on facts pending in your jurisdictions can be decided. PART I: 1. (a) Decision of the Hon'ble High Court of Rajasthan dated 29.02.2016 in the case of Savitri Concast Ltd. in DB C.W.P 4784/2012, 5285/2012 & 5286/2012, (b) Decision of Hon'b....
X X X X Extracts X X X X
X X X X Extracts X X X X
....apital goods and input services as permissible under CENVAT Credit Rules, 2004. The assessee had five manufacturing units and had its registered office at Vatva, Ahmedabad. The assessee was also providing several taxable services such as erection and commissioning, repairing and maintenance of water treatment plant, etc. 2.3 The revenue authorities, during scrutiny of the records of the assessee, noticed that it was availing the credit of service tax paid for various services by one unit for the purpose of clearance of other unit. After gathering details from the assessee, the adjudicating authority issued show cause notice calling upon the assessee as to why the CENVAT credit of service tax on input service should not be recovered with interest and penalties. In the show cause notice itself, the adjudicating authority had referred to sub-rule (3) of Rule 15 of the Rules of 2004 as basis for such proposal. Two primary objections of the Department were that the assessee had not registered itself under the Service Tax (Registration of Special Category of Persons), Rules 2005 and that the tax credit from one unit was utilized for discharging tax liability of another unit instead of....
X X X X Extracts X X X X
X X X X Extracts X X X X
....2008-CX dated 17.11.08 and Hon'ble Supreme Court decision in CCE vs MDS Swithchgear Ltd. [ 2008 (229) ELT 485 (SC)]. The Hon'ble High Court upheld the decision of the CESTAT and dismissed the departmental appeal. 4. Decision of the Hon'ble High Court of Gujarat dated 17.12.2015 in the matter of Apar Industries (Polymer Division) vs Union of India in Special Civil Application No. 7815 of 2014 [2015-TIOL-2859-HC-AHM-CUS] 4.1 Department has accepted the order of the Hon'ble High Court of Gujarat in the case of Apar Industries (Polymer Division) vs Union of India in Special Civil Application No. 7815 of 2014. The issue examined in the order is as follows, Manufacturer exporter, M/s Apar Industries (Polymer Division) filed Rebate claims in incorrect format under Rule 19 instead of as required under Rule 18. The same was re-filed correctly but department held that the subsequent filing was time barred. The Hon'ble Court held that the intention of claiming rebate was clear and first application should have been treated by the department as rebate application. Whatever defect arose from the incorrect filing could have been rectified. In such situations, re-submission should be se....
X X X X Extracts X X X X
X X X X Extracts X X X X
....urt's order in the matter of Choice Laboratories where the Hon'ble Court inter alia held that "Petitioners had bonafide filed their appeal before a forum which lacked jurisdiction. 6.2 The issue examined in the order is as follows, M/s Sun Pharmaceutical Industries Ltd. filed a rebate claim which was rejected by the jurisdictional Deputy Commissioner on the grounds that the time limit for filing rebate in terms of Rule 12 (1) (a) of the Central Excise Rules, 1944, has been prescribed with reference to Section 11 B of the Central Excise Act, 1944, under condition no. (iv) of the notification no. 41/94-CE (NT) dated 22.09.1994, issued under said Rule 12 (1). The limitation period of 6 months for filing rebate as prescribed under said Section 11 B was absolute and the Act does not have any provision for relaxation to Rules or notification which can transcend, modify or abbreviate the provision of the Act. 6.3 The assessee filed an appeal before the Commissioner (Appeals) against the said OIO. The Commissioner (Appeals) rejected the appeal. The assessee then filed a Revision Application against he said OIA. The JS (RA) rejected the application. 6.4 The assessee then filed a wr....
X X X X Extracts X X X X
X X X X Extracts X X X X
....llowing grounds, a) As per provisions of the Central Excise Act, 1944 and the PMPM Rules abatement is to be granted and the statute does not prescribe any order of abatement to be passed by the any authority such as DC/AC. b) In the erstwhile Central Excise Rules, 1944, there was an express provision which provides for claim of abatement would be allowed by an order passed by the Commissioner of Central Excise. When the intention of the government is that amount is to be refunded in as specific manner, then an express provision is provided. However the impugned rule does not make any such provision. c) The Board Instruction from F.No.267/16/2009-CX-8 dated 12.03.2009 is not applicable in the present case as Rule of PMPM rules does not speak of any order of abatement. 8. Decision of the Hon'ble High Court of Karnataka at Bangalore dated 09.04.2015 in the case of M/s PNB Metlife India Insurance Company Ltd., Bangalore. 8.1 Department has accepted the aforementioned order of the Hon'ble High Court of Karnataka. The issue examined in the order was, whether Reinsurance is an input service which is used for providing output service, namely, Insurance and whether CENVAT Cre....
X X X X Extracts X X X X
X X X X Extracts X X X X
....notification was not amended due to oversight. The Hon'ble Court held that this will be plainly discriminatory and hence declared the portion "and Nepal" appearing in Explanation Clause (G) to SSI Notification No.8 of 2003 unconstitutional with effect from 01.03.2012. 11. Decision of the Hon'ble High Court of Rajasthan dated 23.04.2016 in the matter of Barijoriwala's Rolling Mills Pvt. Ltd in DB CWP No. 2/2014 [2016-TIOL-3184-HC-RAJ-CX] 11.1 Department has accepted the aforementioned order of Hon'ble High Court where the Hon'ble High Court lowered the requirement of pre-deposit to 15 per cent of duty or penalty as the case may be, from 25 per cent as was ordered by the CESTAT as the Hon'ble High Court had pronounced same judgment in several other cases. 11.2 The CWP filed by the assessee challenged the CESTAT's direction to pre-deposit 50% of the duty confirmed in terms of second proviso to Sec 35F of CEA 1944. The Hon'ble High Court directed the assessee to deposit 15% of demand to restore the appeals before CESTAT in light of the fact that Section 35 A of CEA, 1944 was amended by Finance Act 2014 stipulating payment of 7.5% and 10% of duty as pre-deposit for the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ion of law was involved. 3 Decision of the High Court of Bombay dated 01.02.2016 in the matter of M/s SV Jiwani in Central Excise Appeal No. 252/2014 [2016-TIOL-503-HC-MUM-ST] 3.1 Department has accepted the order of the Hon'ble High Court of Gujarat in the case of M/s SV Jiwani in Central Excise Appeal No. 252/2014 where the Hon'ble High Court had inter alia held on the question framed, whether input service credit could have been availed without exercising the options provided in Rule 2A of the Service Tax (Determination of Values) Rules, 2006 or whether CENVAT credit can be claimed after discharging the liability in full, that having paid the service tax in full, Revenue is not incurring any loss of revenue, hence the Court should not undertake an academic exercise. 3.2 In the matter the issue that was examined by the Hon'ble Court was that, whether input service credit could have been availed without exercising the options provided in Rule 2A of the Service Tax (Determination of Values) Rules, 2006 after having discharged the tax liability in full. It was held by the Hon'ble Court that that having paid the service tax in full, Revenue has not incurred any loss ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ed the appeal of the department and also dismissed the Review Petition with the observation that considering the facts and circumstances and the reasons recorded in the earlier judgment no valid ground is made our for review. 6.2 It was examined whether demand for extended period under section 11 A of the Central Excise Act, 1944 is maintainable when from the same investigation already a separate demand for separate period has been raised. Hon'ble High Court of Gujarat dismissed department's appeal relying on ratio of decision of Hon'ble Supreme Court in the case of Nizam Sugar Factory [2006 (197) ELT 465 (SC)]. 7. Decision of the Hon'ble High Court of Madhya Pradesh (Indore Bench) dated 09.05.2016 in the matter of Anant Commodities Pvt. Ltd. & others R.P. No. 131/2016 (arising out of CEA No. 11/2010) 7.1 Department has accepted the aforementioned order of the Hon'ble High Court of Madhya Pradesh where the Hon'ble High Court dismissed the department appeal on monetary limits. 7.2 In the case, assessees filed refund claim in terms of Notification No 41/2007 in respect of Service tax paid on services utilised by them for export of goods. Refund was rejected on few service....
X X X X Extracts X X X X
X X X X Extracts X X X X
....sue is about clandestine removal of tobacco products without maintaining the statutory records. Commissioner confirmed demand of Rs. 4.96 crore with equal penalty and penalty on directors. On appeal, CESTAT set aside the order. Department's appeal was dismissed by the Hon'ble High Court as no substantial question of law arose for consideration. 10. (a) Decision of the Hon'ble High Court of Rajasthan in the matter of Barijoriwala's Rolling Mills Pvt. Ltd in DB CWP No. 2/2014 (b) Decision of the Hon'be High Court of Rajasthan in the matter M/s M. M. Brothers in DB Excise (ST) Appeal No. 7555/2015 [2016-TIOL-3184-HC-RAJ-CX] 10.1 Department has accepted the aforementioned order of Hon'ble High Court where the Hon'ble High Court lowered the requirement of pre-deposit to 15 per cent of duty or penalty as the case may be, from 25 per cent as was ordered by the CESTAT as the Hon'ble High Court had pronounced same judgment in several other cases. 10.2 The CWP filed by the assessee challenged the CESTAT's direction to pre-deposit 50% of the duty confirmed in terms of second proviso to Sec 35F of CEA 1944. The Hon'ble High Court directed the assessee to deposit 15% of dema....
X X X X Extracts X X X X
X X X X Extracts X X X X
....0 CBEC had clarified that such amount retained by the assessee is not required to be added to the assessable value. This view was negated by Apex court in the above said orders. Since there was no clarity on the issue, the assessee cannot be said to be at fault, hence extended period would not be available to raise the demand. 13. Decision of the Hon'ble High Court of Bombay dated 03.11.2014 in WP No. 2920/2014 in the case of JCB India Ltd vs UOI & Ors and WP No. 9431/2014 in the case of Sandvik Asia Pvt. Ltd vs UOI. 13.1 Department has accepted the aforementioned order of the Hon'ble High Court where the Hon'ble Court disposed of the Writ Petitions by relying on its earlier decisions dated 01.09.2014 in case of M/s Alfa Laval (India) Ltd and M/s Sandvik Asia Pvt. Ltd. 13.2 The issue that was examined was whether prior to 22.11.2014, statutory provisions did not prevent the party to first claim the benefit of AIR Drawback and thereafter claim Brand Rate Drawback. 14. Decision of Hon'ble High Court of Gujarat dated 02.12.2014 in the department's Tax Appeal No. 1274/2014 in the case of M/s Fact Paper Mill Ltd, Morhi. 14.1 Department has accepted the order of the Hon'bl....
X X X X Extracts X X X X
X X X X Extracts X X X X
....No. 1/2015 in the case of Commissioner of Central Excise, Meerut vs M/s Paramount Pesticides Ltd. 16.1 Department has accepted the decision of the Hon'ble Allahabad High Court dated 13.01.2014 in Central Excise Appeal Defective No. 1/2015 in the case of Commissioner of Central Excise, Meerut vs M/s Paramount Pesticides Ltd., where the Hon'ble High Court held that they did not find any reason to interfere in the impugned order dated 06.03.2014 passed by the Appellate Tribunal. It further held that the appeal fails and it is dismissed with the observation that the Appellate Tribunal will endeavour to decide the matter finally after hearing all the parties concerned within four months from the date of production of certified copy of this order. 16.2 In the case assessee is engaged in manufacture of pesticides. The issue involved was whether after the insertion of third proviso in Section 35C(2A) of Central Excise Act, 1944 w.e.f 10.5.2013, the Tribunal was correct in granting stay beyond specified maximum time limit prescribed in the section. The Central Excise duty was not deposited by the assessee within the prescribed time limit as per Rule 8(3A) of the Central Excise Rule, 2....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the Tax Appeal No. 1230/2014 in the case of Commissioner of Central Excise and Customs, Rajkot vs M/s Major Cement Pvt. Ltd. 18.1 Department has accepted the decision of the Hon'ble High Court of Gujarat's order dated 09.12.2014 in the Tax Appeal No. 1230/2014 in the case of Commissioner of Central Excise and Customs, Rajkot vs M/s Major Cement Pvt Ltd where the Hon'ble High Court dismissed the tax appeals of the department and upheld the findings of the tribunal on the grounds that the test report dated 07.05.2008 were unreliable and the statements of the persons relied upon by the department should have been allowed to be cross examined. 18.2 In the case SCN issued on wrong availment of CENVAT Credit, without receipt of 'pet coke', on basis of fabricated invoices. SCN indicated drawal of samples on 26.04.08 but this reference was dropped in the corrigendum issued to the SCN. Department relied on report of samples drawn on 03.05.08 from a private lab to suggest that the goods did not confirm to the specification of pet coke. Tribunal held that Samples were not correctly drawn and thus the test report was not reliable. Further the cross examination of the persons who....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ioned order of the Hon'ble Court where it was held that the tax appeal is not maintainable and both the CESTAT and the Hon'ble High Court set aside the confiscation under section 111(p) of the Customs Act, 1962 for the reason that notification No. 205/84 was amended declaring "synthetic yarn" as notified goods under section 11B of Chapter IV A of the Customs Act, 1962 vide Notification No. 5/93-Cus (NS) dated 15.1.1993. 21.2 In the case, POY was purchased through Advance intermediate transferable licence under the cover of various DEEC books and bills of entry and the said yarn was allegedly sold in the open market without fulfilling the export obligations. CESTAT opined that confiscation under section 111(p) of the Customs Act, 1962 cannot be upheld since notification no. 205/84 was amended declaring "synthetic yarn" as notified goods under Section 11 (B) of Chapter IVA of the Act ibid vide Notification no. 5/93-Cus (NS) dated 15.01.1993. Hence penalty under Section 112 of the Customs Act, 1962 as imposed on the appellant cannot be upheld as per the decision in the case of S.S. Gupta vs. CC [2001 (132)ELT.441 (Tri.Del)] and accordingly allowed the appeal filed by the party. The....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... (2), VKI Area, Jaipur. 24.1 Department has accepted the order of the Hon'ble High Court of Rajasthan, Jaipur in the matter of M/s Shankar Products, behind factory No. 667, Road No. 9 (F) (2), VKI Area, Jaipur where the Hon'ble High Court dismissed the appeal of the department and upheld the decision of CESTAT where the CESTAT held that where department had knowledge and had issued an earlier notice on the similar ground, it cannot be said that there was any suppression. 24.2 Department issued a SCN dated 28.08.08 demanding duty for the period April 2004 to June 2008 invoking extended period on ground that the process undertaken by the appellant amounts to manufacture and they had suppressed the relevant facts from the department. On the basis of the same facts another SCN for subsequent period from July 2008 to 4.12.2008 was issued on 6.7.2010 again invoking the extended period, which in view of the Apex Court's judgement in the case of Nizam Sugar Factory (supra) is not permissible. High Court, Rajasthan dismissed the departmental appeal. 25. Decision of the Delhi High Court dated 13.04.2015 in the matter of CEAC No. 2/2015 in the matter of Commissioner of Central Ex....
X X X X Extracts X X X X
X X X X Extracts X X X X
....of three months from the date of receipt of application and not from the decision. Departmental appeal was therefore dismissed. 27. Decision of the Hon'ble High Court dated 03.09.2014 in the matter of M/s Bajrang Castings Pvt. Ltd and five others in Tax Appeal No. 824 of 2014 27.1 Department has accepted the order of the Hon'ble High Court dated 03.09.2014 in the matter of M/s Bajrang Castings Pvt. Ltd and five others in Tax Appeal No. 824 of 2014 where the Hon'ble High Court held that in the matter that since there was no question of law involved, interference by the Court in the decision of the CESTAT was not warranted. 27.2 In the matter, allegation was availment of CENVAT credit on invoices without actually receiving the goods. Also that non-CENVATable bazar scrap was used in manufacture of MS Ingots. Such irregular credit was used for payment of licit clearances to avoid payment of duty from PLA. CESTAT ordered that demands were based upon the statements of transporters or drivers of the trucks which were not corroborated by any evidence. No investigation was conducted at consignors' place or at the place where the said goods are alleged to have been supplied. In ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ssee for defacement, credit was not admissible. Tribunal allowed the credit holding that the said document was verifiable. In departmental appeal HC upheld CESTAT's decision. 30. Decision of the Hon'ble High Court of Gujarat in Tax Appeal No. 363 of 2015 in the matter of CCE, Rajkot vs M/s Reliance Ports & Terminals Ltd., Jamnagar. 30.1 Department has accepted the order of the Hon'ble High Court of Gujarat in Tax Appeal No. 363 of 2015 in the matter of CCE, Rajkot vs M/s Reliance Ports & Terminals Ltd., Jamnagar where the Hon'ble High Court dismissed the departmental appeal holding that since the questions proposed by the appellant were not subject matter of the show cause notice and also do not arise out of the impugned order of passed by the Tribunal. 30.2 In the matter, CERA pointed irregular availment of CENVAT Credit of service tax paid under section 66A as recipient of "Consulting Engineer" and "Banking Services", etc, which allegedly were not "input services". Credit was also alleged to have been availed on capital goods before their actual installation. Commissioner dropped the demand. Department filed appeal before CESTAT and later the HC. It was held by appel....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ct that there has been violation of principles of natural justice, quashed the said letters and also allowed the department to initiate action under PMPM Rules and section 11A of the CE Act. 33. Decision of Hon'ble High Court of Allahabad dated 13.10.2015 in Central Excise Appeals No. 251-256 of 2015 in cases (a) CCE, Noida vs M/s Dharampal Satyapal Ltd., (b) CCE, Noida vs Shri Chiranjiv Roy Choudhory., (c) CCE vs Rajiv Kumar (d) CCE, Noida vs Sh. Nareshh Dhir (E) CCE, Noida vs Sh. J.D. Desai and (f) CCE, Noida vs Sh. Amit Singhai. 33.1 Department has accepted the aforementioned order of the Hon'ble High Court of Allahabad which held that in the matter no substantial question of law was involved. 33.2 Court dismissed Department's appeal on the grounds that Tribunal has found that as per the technical literature the pouch packing machine was a duplex machine having single track with innovation that on the same line, at a time, two pouches are cut and filled resulting in higher production and that the duty is per pouch packing machine per month and not on actual number of pouches produced. 34. Decision of the Hon'ble High Court of Gujarat in the case of M/s Shree Rama Mul....
X X X X Extracts X X X X
X X X X Extracts X X X X
....volved interpretation of notification and that appeal shall lie before the Apex court. 36. Decision of Hon'ble High Court of Madras in CMA No. 4050/2008 in the case filed by the Department against CESTAT Final order No. 479/2008 dated 14.05.2008 in the case of M/s Sakthi Sugars Ltd., Appakudal, Bhavani Taluk & Order of the Hon'ble High Court of Madras in CMA No. 1570/2009 in the case filed by the Department against CESTAT Final order No. 802/2007 dated 26.06.2007 in the case of M/s Sakhti Sugars Ltd., Appakudal, Bhavani Taluk. 36.1 Department has accepted the aforementioned order of the Hon'ble High Court of Madras where the Hon'ble Court disposed the appeal of the department as not maintainable after observing that the question is to be decided by the Apex Court in an appeal to be filed under section 35 L (b) of the Act and not by it under Section 35 G of the Act and thus disposed the case with a liberty to the Department to move before the Supreme Court. 36.2 In the matter, allegation was non-payment of Central Excise duty on molasses, which was captively consumed in the factory, by wrongly claiming exemption under Notification No. 67/95-CE dated 16.03.95 as the molasses....
X X X X Extracts X X X X
X X X X Extracts X X X X
....No. 23/2004 dated 09.07.2004 or not. As issue pertains to rate of duty or valuation, Hon'ble High Court dismissed departmental appeal with liberty to move the Hon'ble Supreme Court. 39. Decision of the Hon'ble High Court of Madras dated 28.08.2014 in CMA No. 463/2007 filed by M/s Emkay Alloys (P) Ltd., against the Final order No. 1425/2005, dated 07.10.2005 of the Hon'ble CESTAT, Chennai 39.1 Department has accepted the aforementioned order of the Hon'ble High Court of Madras where the Hon'ble High Court inter alia held that the appeal is partly allowed by way of remand in terms of the order of the Tribunal dated 16.04.2007 made in Final order No. 410/07 in Appeal No. E/158/2007. 39.2 Issue relates to manufacture of Ingots and Billets of non-alloy steel, for which the party was supposed to pay duty under Compounded Levy Scheme as said goods were notified under that scheme w.e.f 01.08.1997 and excise duty was to be discharged on the basis of Annual Capacity of Production. Two ACP Orders (dated 16.09.1997 and 09.07.1998) were issued fixing the duty payable. Party did not discharge the liability and therefore 6 SCNs were issued for different periods. One SCN was based on ACP ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ribunal is a possible view. Order of pre-deposit is made exercising the discretionary powers and same cannot have any precedent value. Departmental appeal was therefore dismissed. 42. Decision of the Hon'ble High Court of Madras dated 04.06.2015 in CMA No. 3420 & 3421 of 2008 in the case of M/s Dalmia Cements Ltd. 42.1 Department has accepted the aforementioned order of the Hon'ble High Court of Madras where the Hon'ble High Court relying upon the judgment of High Court of Allahabad in the case of Hero Motors of identical nature stated that the Tribunal's decision does not require any interference. 42.2 In the matter, assessee availed credit on inputs and capital goods used in creation of power plant. The plant was leased to another company. Department was of the view that such goods were deemed to have been removed and party was liable to pay the amount of credit availed in terms of Rule 3(5) of CENVAT Credit Rules 2004. Also, after leasing out the power plant from 15.03.2005 to 15.03.2006, DCL wrongly availed CENVAT credit as these inputs/ Capital goods/input services were not used in the factory of DCL for manufacture of dutiable final product i.e. Cement. Hon'ble H....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Notification No. 32/2006 issued under the said rule is not sustainable under law. 44.2 The issue involved was that the assessee, namely, M/s Scan Sponge Iron Ltd was engaged in clandestine removal of finished goods from two factory units. The same was detected during a search. The party filed writ petition in the Hon'ble High Court against the confirmed demand. Hon'ble High Court, based on previous judgement in similar case quashed Notification No 32/2006-CE dated 30.12.2006 and declared rule 12 CC of Central Excise Rules 2002 and Rule 12 A of CENVAT Credit Rules, 2004 as ultra vires to the Central Excise Act 1944. 45. Decision of the Hon'ble High Court of Madras dated 11.06.2015 in CMA No. 1182/2008 in the case of Commissioner of Central Excise vs M/s Integral Coach Factory 45.1 Department has accepted the aforementioned order of the Hon'ble High Court which upheld the CESTAT's order No. 1106/2007 dated 03.09.2007 and dismissed the Departmental Appeal. 45.2 In the matter, assessee manufactured steel freight containers and passenger coaches for Indian Railways. They sold ferrous and non-ferrous scrap arising out of manufacture without payment of Excise Duty. Al....