Top Stories CESTAT Annual Digest 2024: Indirect Tax Cases [Part 6] A Round-Up of all the CESTAT Decisions in 2024 By Manu Sharma – On January 6, 2025 6:45 pm – 18 mins read This annual round-up analytically summarizes all the Orders of the CESTAT Benches of India reported at Taxscan.in during 2024. Excess Insurance Charges collected by Manufacturer excluded from assessable value, exempt from Excise Duty as duty is on manufacture, not on Profit: CESTAT allows Appeal- M/s GSC Toughened Glass vs Commissioner of Central Excise CITATION: 2024 TAXSCAN (CESTAT) 347 The Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ), Regional Bench in Allahabad, has held that insurance charges collected by a manufacturer are to be excluded from the assessable value and are therefore exempt from excise duty. the two-member bench comprising Mr. P.K. Choudhary ( Judicial Member ) and Mr. Sanjiv Srivastava ( Technical Member ) set aside the Order-In-Appeal and reinstated the Order-In-Original upholding the principle that excise duty does not extend to profit elements. The appeal filed by the appellant was allowed with consequential relief, if any, as per the law. Refund of SAD cannot be denied stating Invalidity of Certificate even after issuance of Correlation Certificate: CESTAT – M/s. Veneer Mills vs The Commissioner of Customs, (Port-Export) CITATION: 2024 TAXSCAN (CESTAT) 344 The Chennai bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) has held that refund of Special Additional Duty ( SAD ) cannot be denied stating invalidity of certificate even after issuance of correlation certificate. The tribunal viewed that when the chartered accountant has examined the documents relating to the import as well as the sales as accounted by the appellant and issued a correlation certificate, the refund cannot be denied. A two-member bench comprising Mrs Sulekha Beevi C S, Member ( Judicial ) and  Mr Vasa Seshagiri Rao, Member ( Technical ) observed that when the Chartered Accountant has examined the documents relating to the import as well as the sales as accounted by the appellant and issued a correlation certificate, the department cannot deny the refund stating that the said certificate is not valid. In view of the above, we hold that the appellant is eligible for a refund. Limitation period to file Appeal starts from date of acknowledgment order not from dispatch date: CESTAT- ASHAPURA MINECHEM LTD vs C.C.-JAMNAGAR(PREV) CITATION: 2024 TAXSCAN (CESTAT) 345 The Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) in Ahmedabad has made a significant ruling clarifying that the limitation period to file an appeal begins from the date of acknowledgment of the order, not from the date of dispatch.

The bench, comprising Ramesh Nair (Judicial Member) and Raju (Technical Member), noted that while there was evidence of the department dispatching the order to the appellant, there was no proof of acknowledgment. In accordance with appeal provisions, the time limit commences from the communication of the order, not its dispatch. Since there was no evidence of the order being communicated, the date on which the department provided the copy of the orders-in-original to the appellant was considered the date of communication. Consequently, the appeals before the Commissioner ( Appeal ) were deemed not time-barred. Transaction between Licensee and Licensor does not fall under renting of Immovable property: CESTAT sets aside Demand of Service Tax-M/s. Peninsula Hotels (P) Limited vs Commissioner of Central Excise CITATION: 2024 TAXSCAN (CESTAT) 343 The Chennai bench of  Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) held that the transaction between licensee and licensor does not fall under renting of immovable property and sets aside the Demand of Service Tax. The said transaction was a business transaction between the two since the consideration was not like regular rent but depended on the annual performance and the profits generated. A two-member bench comprising  Mr P Dinesha, Member ( Judicial ) And Mr  K Anpazhakan, Member ( Technical ) observed that there is no change in the facts and circumstances of the case on hand and the one decided by the co-ordinate Bench for earlier periods ( supra ) and hence, the decision arrived at in the earlier order squarely covers the issue in the case on hand as well. Alternative Exemption Notification can be claimed even at Time of Import of Goods: CESTAT- Olam Agro India Ltd vs C.C.-Ahmedabad CITATION: 2024 TAXSCAN (CESTAT) 341 The Ahmedabad bench of the Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) has held that the beneficial notification can be claimed at a later stage also if otherwise the same is eligible at the time of import of goods.

A two-member bench comprising Mr Ramesh Nair, Member ( Judicial ) and Mr Raju,  Member ( Technical ) observed that the issue of whether after import, the appellant can claim alternate exemption notification is settled by the Apex Court in the case of Share Medical Care, wherein it was held that the beneficial notification can be claimed at a later stage also if otherwise the same is eligible at the time of import of goods. Explanation 3(a) to Sec.65(44) does not apply to members of Club /Association which are Incorporated: CESTAT- Villa Greens House Owners Welfare Association vs Commissioner of Central Tax Rangareddy – GST CITATION: 2024 TAXSCAN (CESTAT) 342 In the recent case, the Hyderabad bench of the Customs, Excise And Service Tax Appellate Tribunal ( CESTAT ) has held that Explanation 3(a) to Sec.65(44)of the Finance Act does not apply to members of clubs/associations that are incorporated. A two-member bench comprising of Mr Anil Choudhary, Member ( Judicial ) and Mr A K Jyotishi, Member ( Technical ) observed that the Appellant is a body registered or incorporated under the Andhra Pradesh Societies Registration Act, 2001. Further explanation 3(a) to Sec 65(44) does not apply to members’ clubs/associations, which are incorporated. Any Goods Which Fall under Category of Equipments Apparatus are Freely Importable as Per FTP: CESTAT sets aside Confiscation of Goods- M/s.PS Bedi & Co Pvt. Ltd. vs The Commissioner of Customs CITATION: 2024 TAXSCAN (CESTAT) 340 The Customs, Excise And Service Tax Appellate (CESTAT) of the Chennai bench while setting aside the Confiscation of Goods ruled that any goods which fall under the category of equipment apparatus are freely importable as per Foreign Trade Policy (FTP) A two-member bench comprising of Ms Sulekha Beevi C S, Member (Judicial) and  Mr Vasa Seshagiri Rao, Member (Technical) relying on the decision viewed that FTP, any goods which fall under the category of pieces of equipment, apparatus etc. are freely importable irrespective of their size and nature. Interest on Wrongly Taken Cenvat Credit: CESTAT upholds Demand Recovery of 5 Years Period- M/s India Steel Summit Pvt. Ltd vs Commissioner of Central Excise CITATION: 2024 TAXSCAN (CESTAT) 321 The Allahabad Bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) upheld the demand recovery of 5 years in the matter regarding interest on wrongly taken cenvat credit. A Two-Member Bench of PK Choudhary, Judicial Member and Sanjiv Srivastava, Technical Member observed that “It was for the appellant to have paid the interest along with the reversal of the excess credit taken. It is also observed that during the period of dispute section 11A did not provided, for recovery of interest and hence was not applicable. The recovery of interest was made in terms of Section 11AB/ 11AA which did not provided for any limitation.”

Allegation on amount reversed by Lotte India on Processed Milk under Reversal of Proportionate Credit: CESTAT remands matter to Adjudicating Authority- Lotte India Corporation Ltd. vs The Commissioner of Central Excise CITATION: 2024 TAXSCAN (CESTAT) 325 The Chennai in the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) remanded the matter regarding the allegation on the amount reversed by Lotte India on Processed milk under reversal of proportionate credit to the adjudicating authority. A two-member bench comprising Ms Sulekha Beevi C S, Member ( Judicial ) and Mr Vasa Seshagiri Rao, Member ( Technical ) viewed that the said issue as to whether the appellant has reversed the correct amount requires verification by the adjudicating authority. The demand raised for paying 5% / 6% of the value of the exempted goods as per Rule 6 (3) (i) cannot be sustained, as the appellant has exercised the option by reversing some amount of credit. Reverse Proportionate Credit as Per Rule 6(3) of CCR allowable on Manufacturer of processed milk: CESTAT set aside Excise Duty Demand on Lotte India- Lotte India Corporation Ltd. vs The Commissioner of Central Excise CITATION: 2024 TAXSCAN (CESTAT) 325 In a recent judgement, the Chennai in the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) held that reverse proportionate credit as per Rule 6(3) of Cenvat Credit Rules ( CCR ), 2004 are allowable on manufacturers of processed milk and set aside the demand against the Lotte India Corporation Ltd. A two-member bench comprising Ms Sulekha Beevi C S, Member ( Judicial ) and Mr Vasa Seshagiri Rao, Member ( Technical ) observed that the appellant is liable to either reverse the proportionate credit under Rule 6 (3) (ii) or pay an amount equal to 5% / 6% of the value of exempted goods as per Rule 6 (3) (i) of CCR 2004. No Penalty under Excise Act When Duty to Proportionate CENVAT Credit of Exempted Good Paid: CESTAT- Lyka Labs Limited vs Commissioner of Central Excise CITATION: 2024 TAXSCAN (CESTAT) 324

The Ahmedabad bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) has observed that a penalty under the Excise Act is not leviable when duty to proportionate CENVAT credit of exempted goods paid. Further held that since the appellant has paid the amount of 60,15,116/- which is proportionate Cenvat credit attributed to the exempted goods belatedly, they are liable to pay the interest till the date of reversal. A two-member bench comprising Mr Ramesh Nair, Member ( Judicial ) And Mr C L Mahar, Member ( Technical ) that the appellant has a strong prima facie case on time bar, despite that the appellant has paid the proportionate credit of  Rs. 60,15,116/- and despite the demand being time bar they are not contesting the payment of Rs. 60,15,116/- but they are only seeking a lenient view as regard imposition of equal penalty. Deodorants not Prohibited Goods under Drugs and Cosmetics Rules: CESTAT deletes Penalties Citing Re-determination of value w.r.t. non-existing Illegal Imports- M/s.Gypsie Impex vs The Commissioner of Customs CITATION: 2024 TAXSCAN (CESTAT) 330 The Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ), South Zonal Bench, Chennai, has held that deodorants are not considered prohibited goods under the Drugs and Cosmetics Rules, 1945. The bench dismissed the penalties and fines imposed on the importer highlighting the lack of legal basis in the re-determination of the value based on non-contemporaneous imports. The two-member bench comprising Mr. S.S. Garg ( Judicial Member ) and Mr. Ajit Kumar ( Technical Member ) set aside the enhancement and dismissed penalties and fines, except for a Rs.1,00,000 penalty under Section 111(d) of the Customs Act, 1962, for the violation of port restrictions. Excise Duty Exemption cannot be Denied in absence of Wilful Suppression of Fact to Evade Tax: CESTAT-Polymer Technologies International vs Commissioner of Central Excise & ST, Vadodara-i CITATION: 2024 TAXSCAN (CESTAT) 331 The Ahmedabad bench of  Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that excise duty exemption cannot be denied in the absence of wilful suppression of fact to evade tax.

As there is no case of fraud, collusion, wilful misstatement, suppression of facts or contravention with intent to evade and the larger period of limitation is inapplicable in the present case. A two-member bench comprising of Mr Ramesh Nair, Member (Judicial) and Mr Raju, Member (Technical) observed that exemption from Excise duty equal to SAD under Notification No.23/2003-CE is not required since the said goods if imported are exempt from SAD and therefore Excise duty equal to SAD payable under the Proviso to Section 3 (1) of the Central Excise Act 1944, will be NIL. Balloons used for Decorations not required to satisfy BIS Registration as they are not Toys: CESTAT quashes Confiscation Order- M/s. Bubbly Balloons vs The Commissioner of Customs CITATION: 2024 TAXSCAN (CESTAT) 329 The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) quashed the confiscation order and noted that balloons used for decorations are not required to satisfy BIS Registration as they are not toys. A Two-Member Bench of Vasa Seshagiri Rao, Technical Member and CS Sulekha Beevi, Judicial Member observed that “In the present case, the appellant has consistently from the very beginning contended that they are engaged in the business of decorations using balloons, and the goods ( balloons ) imported were intended to be used only for decoration. The department has not been able to establish otherwise. As per the list of items shown in the IS 9873 ( Part I ): 2012 item at (k) shows that holiday decorations that are primarily intended for ornamental purposes are excluded. Thus goods used for decoration is excluded. The said item at (k) does not make any distinction or differentiation based on the material used in for the balloon. Further, in the present case the appellant offered to test the goods as to the nature of the material used. The department did not conduct any test.” Valid Availment of Credit after Three and Half Years implies that Excise Duty Refund was sanctioned correctly: CESTAT- Sun Pharmaceutical Industries vs Commissioner of Central Excise & Customs, Jammu CITATION: 2024 TAXSCAN (CESTAT) 323

The Chandigarh Bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) ruled that valid availment of credit after three and half years implies that excise duty refund was sanctioned correctly. A Two-Member Bench comprising SS Garg, Judicial Member and P Anjani Kumar, Technical Member observed that “We find that in the present case, it is not the stand of the Department that it has sanctioned/approved, refund of duty which was not paid by the appellant, but this is the case, in which the Department has sanctioned refund equal to the amount which was paid by the appellant in cash or through PLA, therefore, it cannot be said that this is a case of excess availment of refund by not complying with the condition of the said Notification.” Relief to BSNL , Cenvat Credit is allowable on Rent a cab services  availed in course of business of providing output services : CESTAT – M/s Bharat Sanchar Nigam Limited vs Commissioner of Central Excise & Service Tax, Patna CITATION: 2024 TAXSCAN (CESTAT) 367 In the case of M/s Bharat Sanchar Nigam Limited(BSNL), the Kolkata bench of Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that Cenvat Credit is allowable on Rent a cab services availed in course of business of providing output services.  In terms of Rule 2(l)(b) of the Cenvat Credit Rules, 2004, the appellant providing output service is entitled to take the Cenvat credit on service tax paid by them.        A two-member bench comprising Mr Ashok Jindal, Member (Judicial) and Mr K Anpazhakan, Member (Technical) observed that the said service has been availed by the appellant in the course of their business of providing output services.  Therefore, in terms of Rule 2(l)(b) of the Cenvat Credit Rules, 2004, the appellant providing output service is entitled to take the Cenvat credit on service tax paid by them. Cenvat Credit Allowable on Service Tax paid on Transportation under RCM: CESTAT- M/s Aditya Dhanraj Enterprises Private Limited vs Commissioner of CGST CITATION: 2024 TAXSCAN (ITAT) 421 The Kolkata bench of Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) has held that Cenvat Credit is allowable on service tax paid on transportation under the Reverse Charge Mechanism ( RCM ). The Tribunal viewed that when the entire demand is under reverse charge mechanism and if the appellant had paid the service tax under reverse charge mechanism, they would have been entitled to Cenvat credit of the same amounts. A two-member bench comprising Mr Ashok Jindal, Member ( Judicial ) and Mr K Anpazhakan, Member ( Technical )  found that the appellant was required to pay service tax on transportation services under the Reverse Charge Mechanism ( RCM ).

If the said charges had been paid by the appellant, the same were entitled to take the credit to the appellant.  Therefore, it is a situation of revenue neutrality as the appellant himself has to take the credit for the same. Service Tax not leviable Merely on Basis of Figures Reflected in Statutory Records: CESTAT-M/s GopiChenna vs Commissioner of Central Tax Medchal – GST CITATION: 2024 TAXSCAN (CESTAT) 366 The Hyderabad Bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) observed that service tax is not leviable merely on basis of figures reflected in statutory records. A Single Member Bench comprising P Anjani Kumar, Technical Member observed that “It is clear that the cases are made on the basis of third party data i.e., amounts reflected in Income Tax Returns and in Form 26AS. Revenue takes the stand that in the Negative List regime, Department is not obliged to prove the provision of a particular service to demand service tax and further, the Appellants could not explain that the difference satisfactorily. I find that this is not the correct approach; exigibility to service tax depends on the service provider, service rendered, service recipient and the consideration thereof. DPC is not a commission/brokerage for sale/purchase of securities, Service Tax not Chargeable: CESTAT- M/s Almondz Global Securities Ltd vs The Commissioner of Central Excise (Appeals) CITATION: 2024 TAXSCAN (CESTAT) 368

The Delhi bench of Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) has held that delayed payment charges ( DPC ) is not a commission/brokerage for sale/purchase of securities and no Service Tax Chargeable. A two member bench comprising of Ms Binu Tamta, Member ( Judicial ) and Ms Hemambika R Priya, Member ( Technical ) observed that there persisted several confusion between the revenue and the appellants in respect to determination of accessible value of taxable service provided by the stock brokers and therefore there was a bona fide belief that there was no levy on receipts other than commission or brokerage received by the stock broker and consequently, no suppression of material facts can be attributed on the appellant with intent to evade payment of duty. Following Rescinded Excise Circular by Commissioner (Appeals) is Condemnable act of Judicial Indiscipline: CESTAT- H D WIRES PVT LTD vs COMMISSIONER OF CENTRAL EXCISE & CGST-INDORE CITATION: 2024 TAXSCAN (CESTAT) 365 The New Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) observed that following rescinded Excise Circular by Commissioner ( Appeals ) is condemnable act of judicial indiscipline. The Single Bench of Dr Rachna Gupta, Judicial Member observed that “Circular dated 25.04.2016 was held unsustainable in law. Subsequent to the said decision that Department also came up with another Circular No.1084/2005 dated 07.07.2022 rescinding the Circular of 25.04.2016 in the light of decisions of the Supreme Court. Commissioner (Appeals) in the present case is observed to still have followed the said rescinded Circular dated 25.04.2016. The said act of the adjudicating authority not merely amounts to mis-interpretation of the provision, but it amounts to the violation of statutory principles, the circular dated 07.07.2022 being binding upon him.

The ignorance of law laid down by the Hon’ble Supreme Court is a condemnable act of judicial indiscipline.” Minor Discrepancies Cannot be Reason for recovery of Customs refund When CA Certify Stock Report: CESTAT- SANTOSH TIMBER TRADING CO LTD vs C.C., KANDLA CITATION: 2024 TAXSCAN (CESTAT) 364 The Ahmedabad bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that minor discrepancies cannot be reason for recovery of customs refund when Chartered Accountant (CA) certify stock report. A two member bench comprising Mr Raju, Member (Technical) and Mr Somesh Arora (Judicial) held that minor discrepancies cannot be the reason for recovery of refund when the appellant had submitted Chartered Accountant certified stock report. The Tribunal set aside the order and allowed the appeals. Sale of Beer which is an Alcoholic Liquor for Human Consumption is Taxable under Business Auxiliary Service: CESTAT directs to consider Exemption under Notification- WINSOME BREWERIES LTD vs COMMISSIONER, CENTRAL EXCISE CITATION: 2024 TAXSCAN (CESTAT) 363 The Delhi bench of the Customs Excise & Service Tax Applellate Tribunal ( CESTAT ) has held that sale of beer which is an alcoholic liquor for human consumption is taxable under Business Auxiliary Service.

The Tribunal directed the adjudicating authority to consider the same and allow the benefit of exemption notification as claimed by the appellants. A two member bench comprising of Mr Somesh Arora, Member ( Judicial ) And Ms Hemambika R Priya, Member ( Technical ) allowed the affidavit to be taken on record and directed the adjudicating authority to consider the same and allow the benefit of exemption notification as claimed by the appellants. The CESTAT held that the adjudicating authority shall appropriately consider the benefit of the notification to be allowed to the appellant in the light of affidavit having been filed with undertaking of not availing the credit,  which has been stated to be not taken till date by the appellant. Process of making lacquered plastic film not amounts to Manufacture, CENVAT credit is admissible if such inputs are cleared on payment of duty: CESTAT- M/s Sandeep Laminators Pvt. Ltd. vs The Commissioner of Central Excise CITATION: 2024 TAXSCAN (CESTAT) 362 The Chandigarh bench of the Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) has held that process of making lacquered plastic film not amounts to manufacture and CENVAT credit is admissible if such inputs are cleared on payment of duty. In various decision, the Supreme Court and High Court has been held that when process undertaken by the assessee does not amount to manufacture, even then the CENVAT credit is admissible if such inputs are cleared on payment of duty which would amount to reversal of credit availed. In view of the ratios of various decisions, the coram comprising Mr S S Garg, Member ( Judicial ) and Mr P Anjani Kumar, Member ( Technical )  set aside the impugned order and allowed the appeal. Importer Cannot be Penalised for Incorrect Mention of Country of Origin in Bill of Entry: CESTAT sets aside Penalty under Customs Act- Rajkamal Industrial Pvt Ltd vs C.C.-Kandla CITATION: 2024 TAXSCAN (CESTAT) 361 The Ahmedabad bench of Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) viewed that the importer cannot be penalized for incorrect mention of country of origin in the bill of entry and set aside  the Penalty under Customs Act, 1962. A two member bench comprising Mr Ramesh Nair, Member ( Judicial ) and Mr Raju Member ( Technical ) held that for incorrect mention of country of origin, the importer cannot be penalized. Considering  overall facts and the fact of incorrect declaration, the bench viewed that if any misdeclaration regarding  country of origin in the Country of Origin Certificate, the appellant is not liable for any penalty or fine. Demand of Service Tax under ‘Advertisement Service’ is invalid in Absence of Evidence to show engagement in making Or preparing or Advising for Advertisement: CESTAT-  M/s Noida Publicity Agency vs Principal Commissioner Central Tax, Noida CITATION:   2024 TAXSCAN (CESTAT) 360 The Allahabad bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) has held that the demand of service tax under ‘Advertisement Service’ is invalid in absence of evidence to show engagement in making or preparing or advising for advertisement. A two member bench comprising Mr P K Choudhary, Member ( Judicial ) And Mr Sanjiv Srivastava, Member (Technical) observed that it is evident from the details given in above invoices that the Appellant was not engaged in designing and conceptualising  advertisement. So, they were not covered under the taxable services.

GTA Service Undertaken for Carriage of Food Grains and Pulses are Exempted by Notification: CESTAT Remand Matter for Re Compute Service Tax Payable- M/s. The Rasipuram Agricultural Producers Co-op. Marketing Society Ltd vs Commissioner of GST and Central Excise CITATION: 2024 TAXSCAN (CESTAT) 359 In a recent judgement, the Chennai bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) remanded matter for re compute service tax payable under Good Transport Agency Service (GTA) Service, as the service undertaken for carriage of food grains and pulses are exempted by notification A two member bench of Mr P Dinesha, Member (Judicial) and Mr Vasa Seshagiri Rao, Member (Technical) directed the Lower Adjudicating Authority to re-compute the tax payable giving the benefit of abatement under Notification No. 32/2004-ST dated 03.12.2004 and exemption benefit under Notification No. 34/2004-ST dated 03.12.2004.  GTA Service undertaken for carriage of food grains and pulses is also exempted from payment of Service Tax w.e.f. 29.02.2010 under Notification No. 33/2004-ST dated 03.12.2004 Failure to establish Non Utilisation of common Input Services for Trading: CESTAT sets aside order of Adjudicating Authority- Rishi Kiran Logistics P Ltd vs C.C.E. & S.T.-Rajkot CITATION: 2024 TAXSCAN (CESTAT) 358 The Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) of Ahmedabad set aside the order of adjudicating authority demanding extended period as the department failed to establish non utilisation of common input services for trading. It was viewed that the department has failed to establish the allegation of suppression of facts with intent to evade payment of duty against the assessee so as to invoke the extended period.

A two member bench comprising Ms Sulekha Beevi C S Member ( Judicial ) and Mr C L Mahar Member ( Technical ) observed that the department has failed to establish the allegation of suppression of facts with intent to evade payment of duty against the assessee so as to invoke the extended period. The show cause notice issued beyond the normal period cannot sustain and requires to be set aside. The issue on limitation is answered in favour of assessee and against the department. Relief to Kuoni Travel India: CESTAT rules Service Tax not Leviable without Identifying Specific Service provided and Consideration Received- Kuoni Travel India Pvt Ltd vs Pr. Commissioner of Central Excise CITATION: 2024 TAXSCAN (CESTAT) 357 In a major relief to M/s Kuoni Travel India, the New Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) ruled that service tax is not leviable without identifying specific service provided and consideration received. A Two-Member Bench comprising Justice Dilip Gupta, President and P Anjani Kumar, Technical Member observed that “We fail to understand as to how the Commissioner comes to the conclusion that this 10% of the income or advances shown in the books of accounts of the appellants leads to the inevitable conclusion that the amounts were for provision of certain services. We find that no specific service has been identified by the Adjudicating Authority, while accepting in principle that duty evasion cannot be proved with mathematical precision, the same cannot be established by applying a mathematical formula. We find that Courts and Tribunal have been consistently holding that service tax cannot be fastened without identifying the specific service provided and consideration received or to be received for the same.” Services of Planning Travel Itinerary of Clients Classifiable as Air Travel Agent: CESTAT quashes Service Tax demand- M/s. International Travel House Pvt. Ltd vs Commissioner of Service Tax CITATION: 2024 TAXSCAN (CESTAT) 356

The New Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) quashed service tax demand and held that the services of planning travel itinerary of clients classifiable as air travel agent A Two-Member Bench comprising Binu Tamta, Member ( Judicial ) and Hemambika R. Priya, Member ( Technical ) observed that “The fact that the appellant has been discharging service tax under Rule 6(7) implies that they are acting as “air travel agents” and hence no further liability arises. There is no doubt that the appellant is engaged in the travel agency business and has been charged service tax under “Air Travel Agent” service as defined in Section 65(4) read with section 65(105)(l).” Remuneration paid to Whole-Time Directors of Company in the form of Commission based on Profit constitutes an Employer-Employee Relationship, No Service Tax Applicable: CESTAT- Gujarat Guardian Ltd vs C.C.E-Bharuch CITATION: 2024 TAXSCAN (CESTAT) 355 The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), West Zonal Bench at Ahmedabad has held that the remuneration paid to whole-time directors of a company in the form of a commission based on profit constitutes an employer-employee relationship, thereby exempting it from service tax. The CESTAT  emphasised that whole-time directors hold significant positions under the Companies Act, are considered key managerial personnel, and are held responsible for any defaults or violations.

Therefore, their remuneration, including commission on profit, is part of the employer-employee relationship and not subject to service tax, irrespective of the form of remuneration. Goods transferred from 100% EOU to its own Domestic Tariff area unit deemed Stock Transfer & Not Sale, Special Additional Duty not Applicable: CESTAT- HERANBA INDUSTRIES LTD vs C.C.E. & S.T.-DAMAN CITATION: 2024 TAXSCAN (CESTAT) 354 The Ahmedabad Bench of Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) has held that the transfer of goods from a 100% Export Oriented Unit ( EOU ) to its own Domestic Tariff Area ( DTA ) unit should be deemed as a stock transfer and not a sale. It was also held that such stock transfers from 100% EOUs to their domestic units are not subject to Special Additional Duty ( SAD ) the two-member bench comprising Mr. Ramesh Nair ( Judicial Member ) and Mr. Raju ( Technical Member ) dismissed the revenue’s contention regarding the limitation issue, noting that the appellant had regularly filed returns indicating the nature of their clearances of goods to their sister units and claiming the benefit of SAD exemption. Consequently, the orders demanding SAD were set aside and the appeals were allowed. Relief to BSNL , Cenvat Credit is allowable on Rent a cab services  availed in course of business of providing output services : CESTAT M/s Bharat Sanchar Nigam Limited vs Commissioner of Central Excise & Service Tax, Patna CITATION: 2024 TAXSCAN (CESTAT) 367 In the case of M/s Bharat Sanchar Nigam Limited (BSNL), the Kolkata bench of Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that Cenvat Credit is allowable on Rent a cab services availed in course of business of providing output services.  In terms of Rule 2(l)(b) of the Cenvat Credit Rules, 2004, the appellant being providing output service is entitled to take the Cenvat credit on service tax paid by them.          A two-member bench comprising Mr Ashok Jindal, Member (Judicial) and Mr K Anpazhakan, Member (Technical) observed that the said service has been availed by the appellant in the course of their business of providing output services.  Therefore, in terms of Rule 2(l)(b) of the Cenvat Credit Rules, 2004, the appellant providing output service is entitled to take the Cenvat credit on service tax paid by them.

DPC is not a commission/brokerage for sale/purchase of securities, Service Tax not Chargeable: CESTAT M/s Almondz Global Securities Ltd vs The Commissioner of Central Excise (Appeals) CITATION: 2024 TAXSCAN (CESTAT) 368 The Delhi bench of Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) has held that delayed payment charges ( DPC ) is not a commission/brokerage for sale/purchase of securities and no service tax chargeable. A two member bench comprising of Ms Binu Tamta, Member ( Judicial ) and Ms Hemambika R Priya, Member ( Technical ) observed that there persisted several confusion between the revenue and the appellants in respect to determination of accessible value of taxable service provided by the stock brokers and therefore there was a bona fide belief that there was no levy on receipts other than commission or brokerage received by the stock broker and consequently, no suppression of material facts can be attributed on the appellant with intent to evade payment of duty.  no demand of service tax both can be raised on the appellant on account of transaction charges and delayed payment charges. The impugned order deserves to be set aside and the appeal is, accordingly allowed