HIMANSHI PRUTHI (NONE) (44 Points)
15 February 2015
Sathish M
(Management Accountant)
(40581 Points)
Replied 15 February 2015
The case laws give a better presentation if you could cover :
1. Citation
2. Facts of the case
3. Decision of the Honorable Tribunal / Court
4. Conclusion
a.kumar
(B.Com)
(341 Points)
Replied 15 February 2015
HIMANSHI PRUTHI
(NONE)
(44 Points)
Replied 15 February 2015
lalit ahuja
(partner)
(21 Points)
Replied 15 February 2015
| Originally posted by : Sathish M | ||
 |
The case laws give a better presentation if you could cover : 1. Citation 2. Facts of the case 3. Decision of the Honorable Tribunal / Court 4. Conclusion |
 |
Citation Example : Salomon v A Salomon & Co Ltd
But friends, this format is good only if question comes for minimum 6 marks.
Unfortunately, the pattern has changed. Now the questions on case studies come for 4 marks only.
Here is the format as per recent suggested answers :
Answer
(a) As per section 4(3)(d) of the Central Excise Act, 1944, transaction value, inter alia, excludes the amount of duty of excise, sales tax and other taxes, if any, actually paid or actually payable on such goods. Hence, the amount of sales tax is excludible from the transaction value of goods only when such amount is actually paid/payable on such
goods.
In the given case, since 75% of the sales tax amount collected from the customers had been retained by the assessee and not paid to the State Government (owing to a benefit under Sales Tax Incentive Scheme), same should form part of the transaction value of the goods.
The Supreme Court, in the case of CCEx v. Super Synotex (India) Ltd. 2014 (301) E.L.T. 273 (S.C.), has held that what is not payable/not to be paid as sales tax/VAT, should not be charged from the third party/customer, but if it is charged and is not payable or paid, it should not be excluded from the transaction value. Hence, unless the sales tax is
actually paid to the Sales Tax Department of the State Government, no benefit towards excise duty can be given under the concept of "transaction value" i.e., it is not excludible.
Thus, Surbhi Textile Ltd. is liable to include 75% of the sales tax retained by it, in terms of the Sales Tax Incentive Scheme, in transaction value of goods.
(b) (i) Paper Ltd. can avail CENVAT credit of the service tax paid on the input services pertaining to maintenance of staff colony. All services used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products upto the place of removal are covered under the definition of input service under rule 2(l) of CENVAT Credit Rules, 2004. In the given case, if Paper Ltd. does not provide accommodation to its employees in that remote location (where its factory is situated), it would not be feasible for it to carry
on its manufacturing activity. Consequently, the services pertaining to maintenance of the staff colony ought to be considered as ‘input services' falling within the ambit of rule 2(l) of the CENVAT Credit Rules, 2004.
The Andhra Pradesh High Court, in CCus. & CEx. v. ITC Limited 2013 (32) STR 288 (A.P.), has also endorsed the said view holding that services crucial for maintaining the staff colony provided by the manufacturer are ‘input services’ when the provision of staff colony is directly and intrinsically linked to the manufacturing activity.
However, Bombay High Court in CCE v. Manikgarh Cement 2010 (20) STR 456 has held that rendering taxable services at the residential colony established by the assessee for the benefit of the employees, is not an activity integrally connected with the business of the assessee and thus, credit is not allowed on the same.
Gujarat High Court in the case of CCEx & Cus v. Gujarat Heavy Chemicals Ltd. 2011 (22) S.T.R. 610 has also taken a similar view. Further, the definition of input service specifically excludes services provided to the employees, which are primarily used for their personal use or consumption. In that case, credit will not be allowed on maintenance services of staff colony.
(ii) An appellant is permitted, under certain specified circumstances, to produce before the Commissioner (Appeals) any evidence other than the evidence produced by him during the course of the proceedings before the adjudicating authority as per rule 5 of Central Excise (Appeals) Rules, 2001.
The High Court, in Utkarsh Corporate Services v. CEx. & ST 2014 (34) STR 35 (Guj.), has held that when production of additional evidence is permissible, raising of additional grounds on the basis of relevant facts existing on record is also permissible. Further, legal grounds can be raised at any stage before any authority.
Therefore, in view of the fact that the additional grounds raised by Suraksha Services before Commissioner (Appeals) were legal grounds, the Commissioner (Appeals) was not justified in denying the raising of such additional grounds.
(c) No, the CESTAT was not justified in dismissing the appeal in the given case.
The facts of the given case are similar to B. E. Office Automation Products Ltd. v. CCEx. 2014 (300) ELT 486 (P &H) decided by High Court wherein it was held that mere payment of redemption fine in no way shrinks the right of the appellant to challenge not only confiscation but also imposition of redemption fine and final penalty.
Further, making of payment of redemption fine by the importer for release of goods at the earliest in order to save cost of detention and demurrage as also to avoid further deterioration in value and quality of goods, cannot be said to be bad or improper.
Each case study for 4 marks.
Format : Provision
Analysis with Case name
Conclusion
HIMANSHI PRUTHI
(NONE)
(44 Points)
Replied 15 February 2015
CAclubindia
