TaxTMI 
TaxTMI 
2024 (5) TMI 1150
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.... I drop the rest of the demand of Rs.6,08,44,215/-. (b) I also impose a penalty of Rs.5,000/- (Rs. Five Thousand only) under Rule 15A of CENVAT Credit Rules, 2004 for contravention of Rule 4(2)(a) of CENVAT Credit Rules, 2004. (c) I set aside the demand of Rs.14,03,43,252/- (Rs. Fourteen Crore, Three Lacs, Forty Three thousand and Two Hundred Fifty two only). The adjudged dues are ordered to be paid forthwith." 2.1 The Appellant is engaged in providing output services under the category of Broadcasting Services. He is availing the facility of Cenvat credit. 2.2 During the course of the audit it was observed that the Appellant has been taking credit on the Set Top Boxes provided by them to their customers for receiving the signals and credit was taken by the Appellant treating them as input. It was observed that these goods being classifiable under Chapter 85 were covered by the definition of capital goods and thus the act of taking 100% credit immediately on the receipt of the said goods was not proper and only 50% of credit should have been taken during that financial year and next 50% should have been gone to the next financial year. 2.3 Show c....
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....002 (149) E.L.T. 73 (P & H)]; • Modi Rubber [2000 (119) E.L.T. 197} • The Department wants to put these goods under the category of capital goods only for the reason that these goods have been capitalized in their book of accounts, and depreciation claimed for the purpose of income tax. It is a settled preposition in law that accounting practices should not govern the interpretation of legal provisions. Reliance placed on the decisions as follows: • Ingersroll Rand (India) Ltd. [2014 (300) E.L.T. 347 (Guj)] • Tuticorin Alkali Chemicals and Fertilizers [1996 (227) I.T.R. 172 (SC)] • Shakti Finance [2013 (258) C.T.R. 433 (Mad)] • The demand for interest could not have been there when the credit taken was not utilized as held in following cases,- • Bill Forge Pvt. Ltd. [2012 (26) S.T.R. 204 (Kar)] • Jaypee Greens [2020 (33) G.S.T.L. 109 (T-All)] • the demand is barred by limitation as extended period of limitation is not available for the reason that • issue is in the nature of the interpretation of statutory provisions. Legal opinion was taken by the Appel....
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.... scope and it covered all the goods falling under Chapter 82, Chapter 84, Chapter 85, and Chapter 90. I find that the STBs (Set Top Boxes) as well as other CPEs procured by the party were being utilized by them for transmission and broadcasting the contents of various channels and, therefore, they cannot be categorized as inputs. STBs are broadly classified under the Chapter 85176960 as Set Top Boxes for gaining access to internet and this Sub-heading 8517 6960 is included under Chapter 85 of the Central Tariff Act, 1985, hence, covered under the definition of capital goods. In this regard it is pertinent to mention that the usage of the STBs is in the form of mechanical device for further enhancement of the transmission to the customers and it cannot be construed as an input as claimed by the party. 5.9 During the course of Audit, it was revealed that the party had booked the CPEs as 'Capital Revenue Expenditure' and availed of the benefit of depreciation on the CPEs as Capital Goods. As such it is evident that the party was treating the CPEs as Capital Goods for the purpose of availment of depreciation from their book balance. insert para 5.10, 5.11, 5.12, 5.13 ....
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....tion when literal interpretation is unambiguous. Such a preposition flows from the following cases:- A. Sneh Enterprises [2006 (202) E.L.T. 7 (S.C.)]. "25. While dealing with a taxing provision, the principle of 'Strict Interpretation' should be applied. The Court shall not interpret the statutory provision in such a manner which would create an additional fiscal burden on a person. It would never be done by invoking the provisions of another Act, which are not attracted. It is also trite that while two interpretations are possible, the Court ordinarily would interpret the provisions in favour of a tax-payer and against the Revenue." B. Acer India [2007 (218) E.L.T. 17 (S.C.)]; "21. Furthermore, the Computers (Additional Duty) Rules, 2004 is a taxing statute. It required to be construed strictly. [See Manish Maheshwari v. Asstt. Commissioner of Income Tax and Anr., 2007 (3) SCALE 627 and Southern Petrochemical Industries Co. Ltd. v. Electricity Inspector and E.T.I.O. and Ors., 2007 (7) SCALE 392]. So construed, we are of the opinion, that the interpretation by the Tribunal is in consonance with the aforementioned rules of interpretation." ....
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.... burden the citizens without authority of law. In other words, when competent Legislature mandates taxing certain persons/certain objects in certain circumstances, it cannot be expanded/interpreted to include those, which were not intended by the Legislature. 22. At the outset, we must clarify the position of 'plain meaning rule or clear and unambiguous rule' with respect of tax law. 'The plain meaning rule' suggests that when the language in the statute is plain and unambiguous, the Court has to read and understand the plain language as such, and there is no scope for any interpretation. This salutary maxim flows from the phrase "cum inverbis nulla ambiguitas est, non debet admitti voluntatis quaestio". Following such maxim, the Courts sometimes have made strict interpretation subordinate to the plain meaning rule [Mangalore Chemicals case (Infra para 37).], though strict interpretation is used in the precise sense. To say that strict interpretation involves plain reading of the statute and to say that one has to utilize strict interpretation in the event of ambiguity is self-contradictory. 23. Next, we may consider the meaning and scope of 'strict interpretation....
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....cessarily involve the former, especially in the area of taxation. The decision of this Court in Punjab Land Development and Reclamation Corporation Ltd., Chandigarh v. Presiding Officer, Labour Court Chandigarh and Ors., (1990) 3 SCC 682, made the said distinction, and explained the literal rule- "The literal rules of construction require the wording of the Act to be construed according to its literal and grammatical meaning whatever the result may be. Unless otherwise provided, the same word must normally be construed throughout the Act in the same sense, and in the case of old statutes regard must be had to its contemporary meaning if there has been no change with the passage of time." That strict interpretation does not encompass strict - literalism into its fold. It may be relevant to note that simply juxtaposing 'strict interpretation' with literal rule' would result in ignoring an important aspect that is 'apparent legislative intent'. We are alive to the fact that there may be overlapping in some cases between the aforesaid two rules. With certainty, we can observe that, 'strict interpretation' does not encompass such literalism, which lead to absurdity and....