CESTAT
10 articles
Missing Battery, Complete Vehicle: CESTAT Principal Bench Classifies a CKD Electric Motorcycle Kit as a Whole Vehicle but Denies the Concessional Kit Exemption
An importer of electric two-wheeler kits argued that a notice issued by an Assistant Commissioner was void, that self-assessed Bills of Entry were final, and that kits missing batteries and chargers still earned the concessional rate. The Tribunal rejected each point: classification follows essential character, but the exemption demands every necessary component.
14 min readShow-Cause Notice as Foundation: CESTAT Kolkata Clears a Rs. 144 Crore Reverse-Charge Demand Under the Place of Provision of Services Rules
A shipping company faced with a Rs. 144.27 crore reverse-charge service tax demand watched the department appeal the near-entirety of it after an adjudicating authority accepted the company's own reading of the Place of Provision of Services Rules. CESTAT Kolkata dismissed that appeal, holding that a show cause notice which asserts a rule applies without saying why the taxpayer's contrary claim is wrong cannot sustain either the demand or an extended period of limitation — and separately held that demurrage is not consideration for a service at all.
13 min readBagasse Is Not 'Manufactured': CESTAT Hyderabad Applies DSCL Sugar to Quash an ₹80.28 Lakh Cenvat Credit Demand Against Gayatri Sugars
A decade after the Supreme Court in Union of India v. DSCL Sugar Ltd. settled that bagasse is agricultural waste and not the result of any manufacturing process, sugar mills are still fighting the same demand under Rule 6(3) of the Cenvat Credit Rules. CESTAT Hyderabad's Final Order in Gayatri Sugars shows why the point keeps recurring — and what it takes to close it out on appeal.
14 min readStatement First, Cross-Examination Second: CESTAT Allahabad Invokes Section 9D of the Central Excise Act to Quash a ₹2.39 Crore Cenvat Credit Fraud Demand Against Rathi Steel and Power
A Ghaziabad steel manufacturer was one of 68 noticees accused of availing Cenvat credit on cenvatable invoices issued without any actual supply of copper scrap. The Customs, Excise & Service Tax Appellate Tribunal set aside the ₹2.39 crore demand confirmed against it, holding that the adjudicating authority relied on third-party statements without following Section 9D of the Central Excise Act's mandatory procedure for admitting them in evidence, treated a co-noticee's settlement under an amnesty scheme as proof against unrelated parties, and confirmed the demand through generic findings that never engaged the appellant's own case.
14 min readJudicial Discipline Binds the Revenue Too: Delhi High Court Quashes a GST Demand That Defied a Binding CESTAT Refund Order
Welspring Universal was handed a Rs. 76,72,000 demand for a CENVAT refund the Customs, Excise and Service Tax Appellate Tribunal had already held it was entitled to keep, on limitation grounds the Tribunal had already rejected. The Delhi High Court quashed the demand, holding that a departmental adjudicating authority cannot treat a superior appellate order as though it does not exist merely because a parallel proceeding remains formally open.
14 min readConsistency Is Sacrosanct in Revenue Matters: Bombay High Court Bars a Rs. 21.92 Crore Service Tax Demand the Department Had Already Dropped Against an Identically Placed Assessee
A show cause notice issued roughly two years after the transactions it targeted, confirming Rs. 21.92 crore in service tax, interest and penalty on a brewery's contract-bottling arrangement with its brand owner. The Bombay High Court's Aurangabad Bench dismissed the Revenue's appeal against the Tribunal's finding that the demand was time-barred, holding that the extended period of limitation cannot be invoked without a specific averment of fraud or suppression in the show cause notice, and that the Department could not press an appeal against one assessee after having accepted an identical Tribunal order in favour of another.
14 min readA Department That Once Agreed With You Cannot Later Call You a Suppressor: Delhi High Court Sets Aside Service Tax Penalty on Construction Services to Government Hospitals and Educational Institutions
Two officers of the Service Tax Department told the audit wing, in writing, that a construction consultant's work for government hospitals and colleges was not taxable. Nineteen years and one appeal later, the Delhi High Court held that the Department could not turn around and call the same conduct wilful suppression warranting penalty, even after upholding the underlying demand for the last nine months of a five-year dispute.
13 min readEighty Percent Sugar, No Marketability Defence: CESTAT Holds Captively Consumed Sugar Syrup Dutiable Even Though the Biscuits It Went Into Were Exempt
A biscuit manufacturer argued its captively consumed sugar syrup, made to a proprietary formula and never sold, was not 'goods' at all. Thirteen years after the show cause notice, CESTAT Ahmedabad disagreed, applying the Supreme Court's marketability test and a bright-line sugar-content threshold from tribunal precedent, while remanding to let the company claim Cenvat credit on the inputs consumed.
14 min readNexus, Not Gross Value: CESTAT Strips Hostel, Mess and Study-Material Fees Out of Commercial Coaching Service Tax
A coaching institute billed tuition, hostel, mess and study-material fees separately for over a decade. The department taxed the lot as one bundle. CESTAT Hyderabad's Final Order works through nine appeals to hold that only what has a real nexus with coaching can be taxed as commercial coaching service — and that repeating a demand the department has already litigated cannot be dressed up as suppression.
14 min readNo Sovereign Shield for Commercial Leasing: CESTAT Holds Delhi Development Authority Liable to Service Tax on Renting Nazul Land
The Delhi Development Authority argued that leasing government land and running its sports complex were sovereign functions immune from service tax. CESTAT disagreed: an enabling power, exercised for consideration retained in the authority's own accounts, is commerce, not statutory duty.
13 min read