Jurisprudentiol - Wednesday's cases

By Vijay Kumar

Legal Corner Icon — the image was hosted by the publisher and was not captured.Service Tax

CBEC informing appellant vide letter dated 24/02/2009 that they are not liable to Service Tax - Board reviewing its decision on 20/09/2011 and conveying that appellant is providing taxable service - Demands of ST issued for the period from 01/05/2006 to 30/09/2011 in view of latter communication - since CBEC had conveyed in February 2009 that appellant is not liable to ST, prima facie, applicant has strong case in favour - Pre-deposit waived and stay granted: CESTAT

THE CCE&ST (LTU), Mumbai confirmed two humongous Service Tax demands of Rs.2075.64 Crores and Rs.283.15 Crores respectively and imposed penalties and interest. The applicants had approached the CBEC for exemption from service tax and that the Board denied the exemption. However, on subsequent representation, vide letter dated 24.02.2009, the Board conveyed that the applicants are not performing the taxable service of General Insurance but is performing the function of a watchdog and guarantor of banking activities by any bank operating in India. It is also conveyed that the charges collected by the applicants are not taxable under the taxable service of General Insurance Business. That, subsequently vide letter dated 20.09.2011, the Board reviewed its earlier decision and decided that the activity undertaken by the applicants fall within the ambit of Sec.65(105) of the Finance Act, 1994 and the applicants are liable to pay service tax as provider of General Insurance Business Service.

Customs

Whatever be goods- alloy or non-alloy steel, after using same, final products have been exported and export obligation is 100% completed; there is no allegation of diversion of goods imported duty free or mis-utilisation - CC, Kandla confirming 860 Crore demand with equivalent penalty - Prima facie case in favourof appellant - Stay granted: CESTAT

THE Commissioner of Customs, Kandla has vide his order dated 19/04/2013 confirmed the demand of customs duty of Rs.860crores along with interest and an equivalent penalty. Personal penalties have also been imposed on co-noticees. The ground for confirmation - that the goods imported are "Alloy Steel" falling under Tariff Heading 72.25 by virtue of Chapter Note 1(f) of Chapter 72 of Customs Tariff whereas the Advance Licences, against which goods were imported, were issued for duty free import of Non-Alloy Steel.

See our Columns Tomorrow for the judgements