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2023 (6) TMI 463 - AT - Service TaxLevy of Service Tax - Business Auxiliary Services - vague SCN - it is alleged that SCN has failed to correctly specify the clause under which the Appellant services will fall - HELD THAT:- On perusal of the Show Cause Notice it is seen that the entire portion of Section 65(19) pertaining to Business Auxiliary Services has been extracted at Para 2 of the Show Cause Notice without any reference whatsoever as to under which clause of the Section 65(19) the services referred by the Appellant would fall. On this issue it is seen that Tribunals have been consistently holding that it is essential for the Show Cause Notice issuing authority to clearly indicate the sub-clause under which the service tax in question would fall. The Tribunals have been consistently holding that the Show Cause Notice should clearly indicate the sub-clause of Section 65(19) under which the alleged services rendered. If the demand is made merely stating that the services rendered falls under Business Auxiliary Services without mentioning the specific clause, the demands cannot be legally sustained - reliance can be placed in COMMISSIONER OF CUSTOMS AND CENTRAL EXCISE, GOA VERSUS SHRI. SWAPNIL ASNODKAR [2018 (1) TMI 266 - CESTAT MUMBAI] and UNITED TELECOMS LTD. VERSUS COMMISSIONER OF SERVICE TAX, HYDERABAD [2010 (10) TMI 730 - CESTAT, BANGALORE]. Extended period of Limitation - HELD THAT:- It would also be relevant to note the decision of Hon’ble Supreme Court in the case of COLLECTOR OF CENTRAL EXCISE VERSUS H.M.M. LIMITED [1995 (1) TMI 70 - SUPREME COURT]. In this case, the demand was made by invoking the proviso to Section 11A(1) of Central Excise Act 1944 by demanding the Excise Duty for the extended period - From the above judgment, it gets clarified that even when extended period is invoked in terms of Section 11A(1), the Department should clearly specify as to under which of the sub-clause the Show Cause Notice is being issued. The ratio of this case law to clarify that whenever any allegation is made, the same is required to be made with specific sub-clause of main clause. Without going into further merits of the arguments on various counts, on the sole ground that the Department has failed to issue the Show Cause Notice with specific allegation specifying the sub-clause of Section 65(19), respectfully following the above cited case law, it is held that the present Appeal towards the confirmed demand of Rs.1,06,74,048/- is required to be allowed. Accordingly, the Appeal is allowed to this extent. Reverse charge mechanism - import of services - HELD THAT:- In the case of INDIAN NATIONAL SHIPOWNERS ASSOCIATION VERSUS UNION OF INDIA [2008 (12) TMI 41 - BOMBAY HIGH COURT], the Hon’ble High Court has held it is only after enactment of Section 66A that taxable services received from abroad by a person belonging to India are taxed in the hands of the Indian residents. In such cases, the Indian recipient of the taxable services is deemed to be a service provider. Before enactment of Section 66A, there was no such provision in the Act and therefore, the Respondents had no authority to levy service tax on the members of the Petitioners-association - thus, the confirmed demand of Rs.11,13,764/- pertaining to the demand till 17.04.2006 is set aside and Appeal is allowed to this extent. As the Appellant has already paid the balance of Rs. 1,26,539/- along with interest of Rs. 15,368/- for the subsequent period and issue was under litigation for quite sometime, the penalty imposed is also set aside. Financial settlement services - HELD THAT:- It is seen that the Appellant has paid the same along with interest of Rs. 4,35,830/- in the course of adjudication process. Therefore, taking a lenient view, the penalty of Rs. 9,05,651/- stands reduced to Rs.2,26,425/-. Appeal disposed off.
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