CESTAT Mumbai Allows YRF Studios' CENVAT Credit On Studio Repair and Renovation Works

The Mumbai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has recently allowed YRF Studios to claim CENVAT credit on service tax paid for repair, renovation, and strengthening works carried out on its existing studio buildings. It held that the services were used for maintaining infrastructure from which the company's taxable output services were provided and were not covered by the exclusion applicable to construction services.The appeal was decided by Technical Member...

Service Tax Refund For SEZ Can't Be Denied If Services Were Used For Authorised Operations: CESTAT Chennai

The Chennai bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that a Special Economic Zone (SEZ) unit cannot be denied a refund of service tax merely because the services were not consumed within the geographical limits of the SEZ, so long as they were used for authorised operations. A single-member tribunal of Technical Member Rajeev Tandon allowed an appeal filed by ATC Tires Private Limited. "It is clear from a bare reading of Section 26(1)(e) that the...

CESTAT Delhi Allows Pharma Company's ₹70 Lakh Refund, Holds Claim Not Hit By Unjust Enrichment

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), New Delhi, has allowed a pharma company's appeal and held that its refund claim of about ₹70 lakh was not hit by unjust enrichment, setting aside orders directing the amount to be credited to the Consumer Welfare Fund.The ruling was delivered by a tribunal comprising Judicial Member Binu Tamta and Technical Member P.V. Subba Rao.Vivek Pharmachem India Ltd., which manufactures medicaments, had availed CENVAT credit of about ₹70 lakh...

CESTAT Delhi Upholds CENVAT Credit Reversal On Common Services Used For Own Investments

The Principal Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), New Delhi, has upheld the demand for proportionate reversal of CENVAT credit on common input services used for both taxable services and an assessee's own investment activities. The tribunal held that buying and selling securities on one's own account is neither a taxable service nor an exempted service. It ruled that CENVAT credit attributable to such activities is inadmissible. A bench of Judicial Member...

Meeting Fees To Whole-Time Directors Not Taxable Under Reverse Charge Mechanism: CESTAT New Delhi

The New Delhi Customs, Excise and Service Tax Appellate Tribunal (CESTAT) on 13 July held that meeting fees paid to whole-time directors are not liable to service tax under the Reverse Charge Mechanism (RCM), as such payments arise from an employer-employee relationship and are excluded from the definition of “service” under the Finance Act, 1994. Judicial Member Binu Tamta and Technical Member P.V. Subba Rao allowed the appeal filed by Oriental Chemical Works and set aside the service tax...

Non-Filing Of Service Tax Returns Alone Doesn't Prove Tax Evasion; CESTAT Chennai Quashes ₹37.54 Lakh Demand

The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has set aside a service tax demand of ₹37.54 lakh against SPI Technologies India Pvt. Ltd., holding that the Department could not invoke the extended limitation period merely because the alleged tax liability surfaced during a departmental audit. The tribunal held that the revenue had failed to establish the wilful suppression or intent to evade tax required to invoke the extended period. A bench of Judicial...

Ahmedabad CESTAT Grants Service Tax Relief On Government Staff Quarters, Remands APMC Issue

The Ahmedabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) on 9 July held that construction of residential staff quarters and government infrastructure meant for personal use of government employees is not liable to service tax under the Finance Act, 1994.Technical Member Sanjiv Srivastava and Judicial Member Dr. Ajaya Krishna Vishvesha partly allowed the Revenue's appeal against contractor Paresh S. Patel. While it granted relief for construction works undertaken for...

CESTAT Delhi Allows Shriram General Insurance's KKC, SBC Refund Claim On Cancelled Insurance Policies

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), New Delhi has allowed Shriram General Insurance's claim for refund of ₹28.57 lakh paid towards Krishi Kalyan Cess (KKC) and Swachh Bharat Cess (SBC) on insurance policies that were subsequently cancelled. The tribunal held that the refund could not be denied on the grounds of limitation or unjust enrichment after the insurer refunded the proportionate premium and tax component. Judicial Member Binu Tamta and Technical Member...

CESTAT Allahabad Sets Aside Service Tax Demand On Bottle Cleaning and Repacking Done For Liquor Manufacturers

The Allahabad Bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has set aside a service tax demand of ₹49.70 lakh against a job work service provider. It held that activities such as repacking old bottles, repackaging glass bottles, barcode sticking, and bottle cleaning carried out for liquor manufacturers constituted exempt intermediate production processes under Entry 30(c) of Notification No. 25/2012-ST. The bench of Judicial Member P.K. Choudhary and Technical...

ITAT Ahmedabad Upholds Rejection Of Tax Deduction Claim On ₹12 Lakh Donation To Political Party

The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) has upheld the denial of a tax deduction claimed by a salaried taxpayer on a ₹12 lakh donation made to a political party, holding that he failed to establish that the contribution was genuine and eligible for deduction. A division bench of Vice-President Dr. B.R.R. Kumar and Judicial Member Rahul Chaudhary observed, "the assessee has failed to establish that the impugned contribution represented a genuine donation eligible for...

Revenue 'Officially But Illegally' Usurped Income: CESTAT Kolkata Orders Interest On Wrongly Collected Service Tax

Observing that the revenue had "officially but illegally" usurped more than half of an employee's annual income, the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Kolkata, directed the department to pay 6% annual interest on the amount collected from her. The tribunal held that the interest would run from the date the amount was collected until the date it was refunded.A coram of Judicial Member R. Muralidhar observed, "The severity of such a demand is beyond imagination when it...

Hyderabad CESTAT Holds Unutilised Education Cess Credit Cannot Be Refunded, Rejects ₹22.11 Lakh Claim

The Hyderabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) on 8 July held that unutilised Education Cess, Secondary and Higher Education (SHE) Cess and Krishi Kalyan Cess (KKC) lying in the CENVAT credit account as on 30 June 2017 cannot be refunded under Section 142 of the Central Goods and Services Tax (CGST) Act, 2017. Judicial Member Angad Prasad and Technical Member P. Anjani Kumar dismissed the appeal filed by Hexagon Capability Centre India Private Limited...