Demand of service tax on remuneration paid to the Chairman and Directors was unsustainable as remuneration paid to the Directors constituted salary under an employer–employee relationship and was therefore not eligible to service tax.
The Tribunal held that transaction value could not be rejected without evidence or proper application of valuation rules. Arbitrary enhancement and penalties were quashed for lack of comparables and proof of undervaluation.
The Tribunal upheld reclassification and duty recovery but ruled that section 111(o) applies only where exemption conditions are breached. Mere ineligibility to exemption due to wrong classification cannot justify confiscation or penalty.
The Tribunal set aside reclassification of imported penetrating oil as adulterated diesel. It held that failure to meet diesel BIS standards and lack of proof of adulteration defeated the Revenue’s case.
The Tribunal upheld duty and interest on use of a fraudulently enhanced duty credit scrip but ruled that penalty under section 114AA cannot be imposed without proof of knowledge or intent. The key takeaway is that mens rea is mandatory for section 114AA penalties.
The Tribunal held that deposits from an e-auction could not be forfeited where confiscated cigarettes failed to meet mandatory labelling laws. Since the goods were required to be destroyed, refund with interest was directed.
CESTAT held that I-STAT blood gas cartridges are accessories of the analyser and not independent diagnostic reagents. As a result, reclassification under CTH 3822 and the resulting duty demand were set aside.
The appellate authority rejected the customs appeal solely on limitation, holding it was filed far beyond the maximum period permitted under law. The ruling underscores that statutory timelines are absolute and merits cannot be examined once delay exceeds the condonable limit.
The Tribunal held that an AI-based smart robot could not be classified as an electronic toy when it satisfied the requirements of an automatic data processing unit. Re-classification by customs authorities was set aside for lack of technical justification.
CESTAT held that handheld barcode scanners with limited mobile features are not classifiable as smartphones. The ruling restores classification as scanners under CTH 8471 and grants exemption from Basic Customs Duty.
