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2015 (1) TMI 383 - Commissioner - Service TaxValuation - computation of taxable value of import of services - Demand of differential tax - Evasion of tax - Intention to evade - Invocation of extended period of limitation - Imposition of interest and penalty - Held that:- Section 67 of the Act clearly states about the concept of “gross amount charged” which in reverse charge mechanism also means the gross amount charged by the service provider or gross amount paid to the service provider. Thus, the amount which was paid to the overseas service provider has to be taken as the taxable value. Thus, it is clear that the amount booked initially was ₹ 25,26,67,577/- on which the appellants paid service tax, whereas the actual amount paid later on by the appellants, to the service provider, was ₹ 25,52,53,374/- in foreign currency, resulting into short payment of service tax of ₹ 2,66,337/-. Further, the appellants have contended that legal proposition laid down by explanation (c) supra would apply to transaction between unrelated parties also, I find that when law is amply clear that the explanation supra is meant for associated enterprise, there is no need to read between the lines. This fact is also strengthened by the rule of literal constriction which states that one of the fundamental principles of interpretation of statue is to interpret a statute from language used in it without adding any words to or subtracting any words from the statute, unless there are adequate grounds to justify the inference that the legislature intended something which it omitted to express and a corollary to this principle would be that an interpretation which renders some word or words in a statute redundant, must be avoided. Therefore, I hold that the reliance placed by the appellants are not sustainable and the service tax demand has been rightly upheld by the adjudicating authority. Validity of issue of SCN where service tax with interest have been deposited earlier - Extended period of limitation - Held that:- as provided under Section 73(4) of the Act, once the extended period has rightly been invoked, the appellants had been rightly issued with the show cause notice, even if they had deposited the differential service tax alongwith interest before issuance of show cause notice. Levy of penalty u/s 78 - Held that:- once the service tax demand is held to be sustainable and it has also been held that extended period had been rightly invoked, the appellants cannot escape the penalty as prescribed under Section 78 of the Act. Thus, I hold that adjudicating authority had rightly imposed the penalty under Section 78 - Decided against the assessee.
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