Electricity Supplied To State Board Not Eligible For CENVAT Credit: CESTAT Chandigarh

The Chandigarh Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that a manufacturer is not entitled to CENVAT credit on fuel used to generate electricity that is wholly supplied to the State Electricity Board (SEB), even if an equivalent quantity of power is later received back through a synchronisation arrangement. A Bench of Judicial Member S.S. Garg and Technical Member P. Anjani Kumar observed that since the electricity generated using the inputs was...

CESTAT Delhi Quashes Excise Demand Alleging Clandestine Production Based Solely On Electricity Consumption

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has set aside a central excise demand against a supari manufacturer, holding that alleged clandestine manufacture and removal could not be sustained in this case when the department relied only on electricity consumption. A bench of President Justice Dilip Gupta and Technical Member P.V. Subba Rao rejected the department's approach, observing: “We are unable to accept this submission of the department. In our view, all that the...

Coal Royalty Includible For Excise Valuation, Other Statutory Levies Excluded: CESTAT New Delhi

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), New Delhi, has partly allowed a batch of appeals filed by South Eastern Coalfields Limited, holding that royalty collected on coal sales is includible in the assessable value for levy of central excise duty, but only for the normal period of limitation. The tribunal, however, set aside excise duty demands on other statutory levies and quashed the invocation of extended limitation, penalty and interest. A coram comprising...

Barreled Bitumen Cost Included In Excise Valuation: CESTAT Ahmedabad

The Ahmedabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) on 22 January upheld the inclusion of the cost of barrels for bitumen sold from depots. It clarified that barrelled bitumen is different from bulk clearances from a refinery and therefore, the two cannot be treated the same.A Bench comprising Judicial Member Dr. Ajaya Krishna Vishvesha and Technical Member Satendra Vikram Singh was examining whether the cost of barrels used for packing bitumen by Nayara Energy...

Branding Structures Installed At Indian Oil Fuel Stations Not Liable To Excise Duty: CESTAT

The Chandigarh Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has recently held that branding and signage structures installed at Indian Oil Corporation Ltd. fuel stations are not subject to central excise duty. These structures are known as Retail Visual Identity or RVI elements. They include monoliths, logos, directional signs and facility signs. The tribunal said the structures come into existence only at the site. Once installed, they become permanent. They...

Printing On Government-Supplied Watermarked Paper Does Not Attract Excise Duty: CESAT Bengaluru

The Bangalore Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that printing carried out on government-supplied watermarked paper for issuance of Record of Rights, Tenancy and Crops (RTC) does not attract central excise duty, and is classifiable under a nil-rated tariff entry. The Bench of Judicial Member Dr. D.M. Misra and Technical Member Pullela Nageswara Rao allowed the appeal filed by Samanthu Business Forms Pvt. Ltd., setting aside a duty demand of Rs....

Place Of Removal In FOR Sales Cannot Be Presumed As Factory Gate: CESTAT Chennai Reiterates

The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has reiterated that the “place of removal” in FOR (Free on Road or Rail) destination sales cannot be mechanically assumed to be the factory gate and must be determined on the basis of facts and contractual terms. The tribunal set aside and remanded a service tax order denying CENVAT credit on outward transportation services after finding that the tax authorities had confirmed the demand without examining...

CESTAT Sets Aside CENVAT Demand Against Textile Company On Inputs Processed By Job Workers Before Rule Change

Deletion of Rule 12B cannot retrospectively deny CENVAT credit lawfully taken on inputs received before the rule change

Kopiko Is Sugar Confectionery, Not Coffee-Based Product; 6%, Not 12%, Excise Duty Applies: CESTAT Hyderabad

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Hyderabad, answering a reference made after conflicting rulings by its Hyderabad and Ahmedabad benches, has held that Kopiko, the coffee-flavored candy sold in India, is classifiable as sugar confectionery under the central excise tariff and not as a coffee-based preparation. As a result, the product falls under tariff heading 1704 9090, which attracts 6% excise duty, and not under heading 2101 1200, which carries a 12% duty. The...

CESTAT Mumbai Allows CENVAT Credit On Kinder Joy Plastic Toys Despite Excise Exemption On Toys

The Mumbai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has allowed CENVAT credit on duty paid inputs and capital goods used to make plastic toys supplied with Kinder Joy chocolates. It held that such credit cannot be denied only because the toys were exempt from central excise duty. A coram of Judicial Member C.J. Mathew and Technical Member Ajay Sharma said that entitlement to CENVAT credit arises once duty-paid inputs or capital goods enter the factory. It can be...

Mere Stock Shortage Not Proof Of Clandestine Removal: CESTAT Allahabad

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT) at Allahabad has held that a shortage of goods found during a departmental inspection cannot, by itself, justify allegations of clandestine removal. The final outcome came after a split verdict was resolved by a third member, S.S. Garg, who agreed that stock shortages alone cannot be treated as proof of illegal clearances. Garg underlined that “mere shortage of goods does not lead to the conclusion that the goods have been removed...

Customs Cannot Withhold Part Of Consignment After Accepting Full Bond, Guarantee : CESTAT Kolkata

The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal recently held that Customs authorities were not justified in continuing to detain part of a consignment of used digital multifunction print and copying machines once the importers had furnished the required bond and bank guaranteef for the entire consignment. A coram consisting of Judicial Member Ashok Jindal and Technical Member K Anpazhakan directed provisional release of 63 machines that had been withheld, noting...