Xiaomi India Liable For Differential Customs Duty On Qualcomm Royalties; Royalty Includible In Assessable Value: CESTAT Chennai:

The Chennai Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held Xiaomi India liable for differential customs duties on royalties to Qualcomm and Beijing Xiaomi Mobile Software under various agreements for importing and selling Xiaomi-branded mobile phones and components The Bench comprising of Mr. M. Ajit Kumar (Technical Member) and Mr. P. Dinesha (Judicial Member) examined whether royalty payments were linked to imported goods and thus dutiable, concluded...

Once Resolution Plan Succeeds, Appeals Before CESTAT Abate, CENVAT Reversal Not Pre-Deposit: Calcutta High Court

The Calcutta High Court has upheld the disallowance of ₹165 crores of CENVAT credit on steel structures, parts, accessories, and cement as confirmed earlier by the Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT).Justice Raja Basu Chowdhury, on the issue of abatement of the appeals, dismissed the grounds of challenge relating to (i) abatement of appeals before the CESTAT, and (ii) the Tribunal's jurisdiction to adjudicate the issue after the Corporate Insolvency...

Customs Act | Delhi High Court Allows BSNL To Belatedly Challenge ₹12.63 Crore Penalty For Misdeclaration Of Goods

The Delhi High Court has allowed BSNL (Bharat Sanchar Nigam Limited) to belatedly challenge the Rs. 12,63,01,812/- imposed upon it by the Customs Department for misdeclaration of imported goods.A division bench of Justices Prathiba M. Singh and Shail Jain noted that the public autonomous service provider showed no valid justification for the delay in approaching CESTAT however, “considering the fact that there was a voluntary declaration by B.S.N.L., prima facie there appears to be some merit in...

Oppo Eligible For Customs Duty Exemption On Microphones & Receivers Used In PCBA Prior To 06.07.2019: CESTAT

The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that Oppo Mobiles is eligible for customs exemption on microphones & receivers used in PCBA (Printed Circuit Board Assembly) prior to 06.07.2019. Justice Dilip Gupta (President) and P.V. Subba Rao (Technical Member) opined that by virtue of the amendment Notification dated 06.07.2019, customs duty would also be leviable on microphones and receivers when imported into India, even if they...

Samples Sent For R&D/Testing Are Not Finished Goods, And Their Movement To Lab Is Not Clandestine Clearance: CESTAT

The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that samples sent for research and development (R&D) and quality testing are not finished goods, and their dispatch to a laboratory cannot be treated as clandestine removal. Justice Dilip Gupta (President) and P. Anjani Kumar (Technical Member) stated that the assessee cleared samples for testing purposes to its in-house facility at Surat in the State of Gujarat and had not cleared ...

Bharat Aluminium Entitled To CENVAT Credit On Mining Services Used For Bauxite Extraction: CESTAT

The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that Bharat Aluminium is entitled to CENVAT (Central Value Added Tax) Credit on mining services used for bauxite extraction. Dilip Gupta (President) and P. Anjani Kumar (Technical Member) agreed with the Principal Commissioner that since mining services were used for the extraction of bauxite from the mines owned by BALCO, and this bauxite was sent to Vendanta for conversion into alumina,...

Profit Sharing Agreement Between Mall And Parking Operator Not Lease, Not Subject To Tax: CESTAT Chennai

The Customs Excise and Service Tax Appellate Tribunal at Chennai on Friday held that a profit-sharing arrangement for managing a mall's parking facility does not amount to leasing of space and therefore is not liable to service tax. The appeal was against an order of Commissioner of Service Tax that had upheld a service tax demand of over Rs 20 lakh, treating the parking arrangement between CCCHPL and SPIPL as leasing of space and therefore taxable. A coram comprising Judicial Member Ajayan T...

Service Tax Provisions Under Finance Act Do Not Extend To Jammu & Kashmir: CESTAT Sets Aside ₹4 Crore Demand

The Chandigarh Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that the provisions of service tax under the Finance Act, 1994, do not extend to the State of Jammu & Kashmir, and accordingly set aside a service tax demand of Rs. 4 crores. S.S. Garg (Judicial Member) and P. Anjani Kumar (Technical Member) opined that the provision of Chapter V of the Finance Act does not extend to J&K. Once the provisions of the Finance Act are not applicable in...

Black Tea Is Agricultural Produce, Commission Paid To Foreign Agents Not Liable To Service Tax : CESTAT Chennai

The Chennai Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) set aside service tax demand on commission paid to foreign agents for sale of black tea, finding that 'essential characteristic' of agricultural produce is retained. CESTAT Chennai clarified that black tea gets covered by the expression 'in relation to agriculture' appearing in Notification 14/2004-S.T. (as amended) dated September 10, 2004 observes that “Once the black tea is found to be agricultural...

Commission-Based Services To Foreign Clients As Agent Qualifies As 'Export Of Service': CESTAT

The Chandigarh Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held that commission-based services such as sales facilitation and regional support services provided by Indian counterparts to foreign companies qualified as 'export' and not as 'Business Auxiliary Services'.The assessee was engaged in the manufacture and sale of zippers and parts thereof in India and to neighbouring foreign companies, including YKK Singapore located in Singapore. The Department conducted an...

Customs | Traveller Entitled To Release Of Goods If SCN Not Issued Within Time, No Liability To Pay Fine Or Penalty: Delhi High Court

The Delhi High Court has clarified that a traveller, whose goods are seized by the Customs, is not liable to pay a redemption fine or penalty for the release of goods if the Department failed to issue a show cause notice within the statutory timeframe.A division bench of Justices Prathiba M. Singh and Madhu Jain observed,“It is the settled position in law, after Union of India &Anr. v. Jatin Ahuja (/2024) that without a SCN under Section 110 of the Customs Act, 1962, the goods of the...

Externally Procured Parts Supplied To Customer For Assembly, But Not Used By Manufacturer, Aren't Liable To Excise Duty : Supreme Court

The Supreme Court on Monday (November 10) dismissed the Revenue Department's excise duty demand against a company that had manufactured and erected a large boiler at a customer's site, holding that the full contract value could not be subjected to central excise duty. The Court clarified that parts bought out externally and supplied to the customer for assembly, but not actually used by the manufacturer, would not attract excise duty. “we arrive at the finding that the final product that...