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Service Tax - Case Laws
Showing 1 to 20 of 29285 Records
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2024 (4) TMI 1041
Refund of Service Tax - tax paid as a mistake of law - applicability of time limitation as per Section 11B of the Act, 1944 - HELD THAT:- This question came up for consideration before the Delhi High Court in HIND AGRO INDUSTRIES LIMITED VERSUS COMMISSIONER OF CUSTOMS [2007 (8) TMI 215 - DELHI HIGH COURT]. After considering the judgment of the Hon’ble Supreme Court in case of Mafatlal Industries Ltd. [2002 (11) TMI 707 - CEGAT, MUMBAI], the Delhi High Court held that the judgment of Mafatlal Industries Ltd. nowhere talks of a situation where the refund of a tax paid under the relevant Act albeit erroneously was required to be made under the Excise Act or the Customs Act and under no other enactment. It was clearly held that judgment of Mafatlal Industries Ltd. (supra 1) is of no assistance in a case where tax is erroneously paid as a mistake of law.
The Tribunal has also taken note of the judgment of Karnataka High Court in COMMISSIONER OF CENTRAL EXCISE (APPEALS), BANGALORE VERSUS KVR CONSTRUCTION [2012 (7) TMI 22 - KARNATAKA HIGH COURT]. The Karnataka High Court also considered the judgment of Delhi High Court in case of Hind Agro Industries Limited [2007 (8) TMI 215 - DELHI HIGH COURT] and the judgment of Mafatlal Industries Ltd. and in no certain terms made it clear that where the tax is admittedly paid as a mistake of law, the limitation will not come in the way for refund.
Thus, no substantial question of law subsists and needs to be answered, because curtains are already drawn on this issue by various High Courts. Thus, admission is declined.
The Central Excise Appeal is dismissed.
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2024 (4) TMI 1040
Payment through CENVAT credit not accepted - supporting documents furnished were also not referred - HELD THAT:- There are no doubts as to the availability of CENVAT credit in the books of the appellant. But however, the lower authority has brushed aside the request of the appellant which is borne on record, but it was incumbent upon the original authority discharging the role of an adjudicating authority to verify/cross verify and then give proper findings through speaking order as to whether the claims of the appellant were acceptable or not. It is precisely the case of the appellant that they had discharged service tax liability to a larger extent through credit balance, but however, the original authority has ignored the claims of the appellant, which is not in accordance with law. Further, it is not even the case of the Revenue that the claims of the appellant were wrong insofar as the availability and the utilization thereof, CENVAT credit towards the payment of their service tax liability, however as contended by the learned Advocate, there may be a slight delay, for which statutory provisions are available to safeguard the interest of the revenue.
If the stand of the appellant is to be accepted upon verification, then, the demand once again would amount to double taxation, which is not the spirit of the taxing statute. In that view of the matter, it is deemed most appropriate to set aside the impugned order and remit matter back to the file of the original authority for de-novo adjudication, who verify the claims of the appellant and thereafter, pass a speaking order in accordance with law.
Appeal is allowed by way of remand.
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2024 (4) TMI 1039
Interest on delayed refund - deposit of whole amount of service tax demanded, under protest - HELD THAT:- Admittedly, in this case, the appellant has made the pre-deposit of whole of the demand of service tax although under protest, but the same was not required to be paid by the appellant to file appeal before this Tribunal - In that circumstances, the appellant is entitled to claim the interest on 7.5% of the demand of service tax deposited (Rs.7,90,08,905/-) on 28.12.2018 till its realization i.e. 01.09.2022.
In terms of the decision of this Tribunal in the case of M/S. PARLE AGRO PVT. LTD. VERSUS COMMISSIONER, CENTRAL GOODS & SERVICE TAX, NOIDA (VICE-VERSA) [2021 (5) TMI 870 - CESTAT ALLAHABAD], the appellant is entitled for interest at the rate of 12% per annum - the appellant is entitled to interest on 7.5% of Rs.7,90,08,905/- from 28.12.2018 till 01.09.2022 at the rate of 12% per annum.
Appeal disposed off.
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2024 (4) TMI 1038
Non-payment of service tax - Valuation - Reimbursements of expenses - Pure Agent - 'Freight Reimbursed' and 'Miscellaneous Expense Reimbursed' - Whether the services provided under two separate agreements (Handling Agent Agreement and Transport Agreement) should be classified independently or merged as a single clearing and forwarding agent service for tax purposes. - Reverse Charge Mechanism - extended period of limitation - HELD THAT:- The dispute in this case is for the inclusion of freight amount in the value of C & F service for which a separate agreement has been entered into with the principal, which we do not consider legally tenable. In the case of Gunesh India Pvt. Ltd [2022 (5) TMI 1042 - CESTAT NEW DELHI] in similar type of arrangement with M/s Ultra Tech Cement Ltd Delhi Bench has held under this agreement under the scope of work, the appellant have correctly treated the work as GTA service and service tax have been rightly discharged by the recipient–Ultratech Cement Ltd under Reverse Charge Mechanism. Thus, the confirmation of demand on the appellant is bad and accordingly set aside.
The demand in terms of the above decision which is squarely on the same set of facts have been set aside both on the merits and also limitation.
In case of Srinivasa Transports [2014 (6) TMI 205 - CESTAT BANGALORE] Bangalore bench has held the appellant has provided labour for undertaking miscellaneous jobs and payment has been made to the appellant based on number of man-days involved. This service also would not come under the category of cargo handling service. Therefore, clubbing all the activities undertaken by the appellant under “Cargo Handling Service” and levying Service Tax under the said category cannot be sustained in law. The adjudicating authority has to examine the individual activities carried out by the appellant and then classify the same, considering the definitions provided in the law, which has not been done in the present case. Therefore, the matter has to go back to the adjudicating authority for fresh consideration.
The impugned order cannot be sustained and the same is set aside - Appeal allowed.
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2024 (4) TMI 1013
Non-payment of service tax - Works Contract Service - Service receiver had already discharged the service tax liability - demand raised on the basis of third party information i.e. data revealed from ITR/Form 26-AS from Income Tax Department - Extended period of Limitation - HELD THAT:- It is found from the records that the service receiver PVVNL deposited the entire service tax amount on the works contract services provided by the Appellant.
This Tribunal in the case of NAVYUG ALLOYS PVT. LTD. VERSUS CCE & C, VADODARA-II [2008 (8) TMI 100 - CESTAT AHEMDABAD] has held that once tax is already paid on the services, it was not open to the Department to confirm the same against the Appellant in respect of the same services, since after accepting the said tax from service recipient, Revenue did not refund the same.
Extended period of Limitation - HELD THAT:- The demand is barred by limitation having been raised by invoking the longer period. The Revenue picked up the figures from the Income Tax Return maintained by the Assessee. The Income Tax Return has been held to be public documents by various decisions and it stands concluded that when the income arising from various activities stand reflected in the said public documents, it cannot be said that there was any suppression or misstatement on the part of the Assessee so as to invoke the longer period of limitation - Reference can be made to Tribunal’s decision in the case of C.S.T. NEW DELHI VERSUS M/S. KAMAL LALWANI [2016 (12) TMI 398 - CESTAT NEW DELHI], laying down that extended period is not invocable if services rendered are reflected in Balance Sheet and Income Tax returns and no evidence stands produced that non-payment of duty was due to any mala fide intention.
The impugned order is set aside and the appeal filed by the Appellant is allowed.
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2024 (4) TMI 1012
Interest liability on delayed payment of tax - seeking waiver of interest since the payment of service tax was paid under the amnesty scheme - appellants have incurred expenditure towards the Import of Services such as CMMI Course Development Fee/CMMI Certified Lead appraiser per appraisal fee/CMI Institute per appraisal fee etc from CMMI Institute, USA for the services received from them - Reverse Charge Mechanism - Rejection of refund - HELD THAT:- The appellants have paid the Service Tax allegedly on being informed about the clarification issued by CBIC. So called clarification, appears but an Amnesty Scheme notified for the benefit of defaulters proposing to give immunity to those who pay Service Tax evaded along with interest. Having accepted the liability, the appellants had no choice but to pay the applicable interest. Though the appellants could have argued that when Learned Commissioner (appeals) has dropped the penalty on the grounds that there was no suppression, fraud etc, the demand could not have been confirmed invoking extended period. They are not disputing the demand of service tax. Hence, their argument that interest is not payable does not hold water. Therefore, the appellants have lost the opportunity and there is no way that they could accept the Service Tax liability but not the interest applicable thereof.
The Courts and Tribunal have been consistently holding that, under Excise, Service Tax provisions, payment of interest is a corollary to the payment of tax and the liability is automatic. The appellants having paid service Tax and having not disputed the payment of the same, whether or not under the said Amnesty Scheme, cannot seek exemption from payment of interest. To this extent, the stand of the appellants is not acceptable. The appellants are liable to pay interest on Service Tax paid in a delayed manner.
Rejection of refund - HELD THAT:- The appellants have paid the service tax after being pointed out by the audit - Having paid service tax and having not challenged such payment, the appellant has accepted the contention of the department. Moreover, the appellants have paid the applicable service tax on being communicated the contents of the circular issued by CBIC; as discussed above, the clarification is a sort of amnesty scheme wherein the tax defaulters were given immunity from payment of penalty in case the duty has been paid along with interest. Therefore, the admissibility of credit in such situation is subject to provision of Rule 9(1) (bb) and therefore, no argument at length, on the issue of provisions of Section 142(7) of CGST Act, 2017, are applicable to the appellant.
Appeal dismissed.
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2024 (4) TMI 967
Extended period of limitation - Suppression of facts or not - Levy of Service Tax - health and fitness service - providing education to patients regarding Yoga - donation received in respect of yoga camp / residential Yoga camp - Donation is related to Education or Health and fitness service or not? - penalty - benefit of Section 80 of FA - it was held by CESTAT that it is observed that demand for the period 01.10.2006 to 31.03.2007 needs to be recomputed after reconciling the amounts received by the appellant during that period with the accounts of appellant and the certificate dated 21.01.2012 of the Chartered Accountant (Anil Ashok & Associates).
HELD THAT:- There are no reason to interfere with the impugned judgment and order. The appeal is accordingly dismissed.
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2024 (4) TMI 966
Extended period of Limitation - suppression of facts or not - Classification of services - supply of tangible goods service or not - deemed sale or not - outward liability towards non-scheduled air transport services under section 73(2) of Finance Act, 1994 - import of aircraft from Non-resident entity on payment of Lease rental, under section 73(2) of Finance Act, 1994 - Interest and Penalty - HELD THAT:- The Department has initiated investigation against the appellant for the first time in June 2010, on the ground that the appellant should discharge its tax liability under the category of ‘supply of tangible goods for use services’. However, no Show Cause Notice was issued at that point of time. Investigation was initiated against the appellant again in the year 2012. After expiry of a period of three years from the initiation of first investigation in month of June 2010, the appellant has been served with the impugned Show Cause Notice invoking extended period and alleging wilful evasion of Service Tax - the appellant has been filing the returns regularly and they have not suppressed any information from the Department. Accordingly, the demand of service tax confirmed in the impugned order by invoking extended period of limitation is not sustainable.
This view has been held by Tribunal in the case of EIH LIMITED VERSUS C.C.E., DELHI-I [2018 (9) TMI 921 - CESTAT NEW DELHI], wherein the Tribunal has held The alleged suppression must be wilful and it is for the Department to prove the same as already observed above, that the Department has failed to prove the wilful intention. As a result, we are of the opinion that the Department was not entitled to invoke the extended period of limitation. Accordingly, the demand falling beyond one year period preceding show cause notice dated 21-12-2010 is not sustainable and accordingly is set aside.
In terms of Section 73 of the Finance Act, 1994, a period of 1 (one) year from the relevant date has been prescribed to serve the Notice on the person chargeable with the service tax which has not been levied or paid or short levied or short paid. This period of one year has been increased to 18 months w.e.f. 28.05.2012. In the present case, the demand of service tax has been raised for the period 2008-09 to 2011-12 vide the impugned Show Caise Notice dated 18.10.2013 - the appellant is liable to pay service tax along with interest for the normal period of limitation, under the category of 'supply of tangible goods service'. As no suppression of fact with intention to evade the tax is established in this case, no penalty is imposable.
Lease rental paid by the appellant to Non-resident entity under reverse charge - supply of tangible goods service - HELD THAT:- The demand has been raised on the Lease rental paid by the appellant to Non-resident entity under reverse charge. The appellant submits that there is no service involved in this transaction of leasing of the aircraft. A perusal of the Terms and Conditions of the Lease/rental agreement reveals that the operation of the aircrafts has been done by the appellant by appointing their own aircraft crew, maintenance staff, by undertaking maintenance and services activities. Thus, in terms of the conditions of lease rental agreement, both possession and control of aircraft has been transferred in favour of the appellant - As possession and effective control has been transferred to the appellant, the demand of service tax under the category of 'supply of tangible goods' is not sustainable.
Interest and penalty - HELD THAT:- The demand confirmed in the impugned order on this count is not sustainable and hence, the same is set aside - As the demand of service tax is not sustainable, the demand of interest and penalty is also not sustainable.
Appeal disposed off.
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2024 (4) TMI 965
Refund of CENVAT Credit - Discretion Power of the refund sanctioning authority - denial on the ground that improper description of the input services noted in the invoices of the Appellant/exporter of services - HELD THAT:- On account of legal services availed as input services, no invoices were raised showing the services as legal services and on the other hand copy of G.A.R.-7 Challan evidencing payment of Service Tax clearly indicates that the said payments were made under ‘Business Auxiliary Services’, ‘Cab Operators Services’, ‘Sponsorship Services’, etc. This being the ground for refusal, it is not to understood as to why the question of re-assessment is to come into play when such refusal is permissible well under Rule, 9 of the CENVAT Credit Rules, 2004.
If particulars of description of goods or taxable service is not properly reflected in the duty paying document and that to the satisfaction of the Dy. Commissioner/Assistant Commissioner of Central Excise about its receipt and accounting for, then the discretion lies with the refund sanctioning Authority namely the Deputy Commissioner or Assistant Commissioner of Central Excise to allow the CENVAT Credit or not and such discretion having been exercised judicially, there are no irregularity on the part of Assistant Commissioner (Refunds-II) CGST, Mumbai East in not allowing the same refund that got confirmed by the order of the Commissioner (Appeals).
The order passed by the Commissioner of GST & CX (Appeals-III), Mumbai in rejecting grant of refund to the Appellant on legal expenses is hereby confirmed - Appeal dismissed.
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2024 (4) TMI 964
Non-payment of service tax - CHA Service - Business Auxiliary Services - reimbursement expenses received - failure to discharge service tax on the incentives / brokerage received by them from steamer agents / shipping lines - demand of differential duty with interest and penalty.
Differential service tax demand raised by the Department under CHA Services - HELD THAT:- The issue as to whether the reimbursable expenses has to be included in the taxable value is settled by the decision of the Hon'ble Apex Court in the case of UNION OF INDIA AND ANR. VERSUS M/S. INTERCONTINENTAL CONSULTANTS AND TECHNOCRATS PVT. LTD. [2018 (3) TMI 357 - SUPREME COURT]. Following the same, the said demand cannot sustain and requires to be set aside.
Demand under Business Auxiliary Services - It is the case of the Department that the appellant received incentives / brokerage from the steamer agents / shipping lines for promoting and marketing the business of steamer agent and shipping lines - HELD THAT:- It is to be noted that the appellant has not been engaged by the steamer agents / shipping lines to provide any service to them. They act as agent for the importer or the exporter. Merely because the steamer agent has paid some incentive to the appellant when they facilitate the export consignment of the importers / exporters it cannot be said that the same would become consideration for providing services. Every flow of money from a person to another cannot be said to be a consideration for providing services. The relationship of service provider and service recipient has to be looked into which is absent in this situation - the demand under Business Auxiliary Services cannot sustain.
The impugned order is set aside - The appeal is allowed.
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2024 (4) TMI 963
Levy of Service tax - renting of immovable property service - religious body or not - assessee has paid the service tax along with interest under VCES - period from 01.10.2008 to 30.06.2012 - penalty - HELD THAT:- The assessee fits in to the category of ‘religious body’. As per the definition of Renting of immovable property service, such service rendered by a religious body or to a religious body is excluded from the levy of service tax. The assessee herein is not liable to pay service tax under the category of renting of immovable property services up to 30.06.2012. Therefore, the demand for the period prior 30.06.2012 cannot be sustained and require to be set aside.
For the period after 30.06.2012 the assessee discharged the service tax up to 31.12.2012 under VCES. As per the said scheme assessee is not required to pay interest or penalty. In the present case the assessee inadvertently paid the interest also. On being pointed out the adjudicating authority has appropriated the said amount towards the interest payable for the period prior to 01.07.2012.
Penalty for the period after 30.06.2012 - HELD THAT:- The assessee being a religious body was not liable to pay service tax prior to 01.07.2012. after the amendment w.e.f. 01.07.2012 the assessee is liable to pay service tax and has discharged the same before passing the order. The issue being interpretational and the period being transitional when the new service tax regime become applicable, we do not find any grounds to impose penalty for the period 31.12.2012 to 30.09.2013. the view of the adjudicating authority in not imposing penalty is upheld. The department appeal is dismissed.
Appeal allowed.
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2024 (4) TMI 912
Recovery of service tax alongwith interest and penalty - works contract service provided by the petitioner between 01.10.2016 to 30.06.2017 - HELD THAT:- The issue is now covered by the decision of the Division Bench of the Principal Seat in M/S. RAJU CONSTRUCTION, REP. BY ITS MANAGING PARTNER, R. SURESH BABU, M/S. VENKATESWARA ENGINEERING CONSTRUCTIONS, REP. BY ITS MANAGING DIRECTOR, MADESAN SIVAPRAKASAM, M. VEDIAPPAN, V. VENGAN VERSUS THE GOVERNMENT OF INDIA, REPRESENTED BY ITS SECRETARY, MINISTRY OF FINANCE, NEW DELHI, THE SENIOR INTELLIGENCE OFFICER, O/O. DIRECTORATE GENERAL OF GST INTELLIGENCE, TRICHY REGIONAL UNIT, THE GOVERNMENT OF TAMIL NADU, REPRESENTED BY ITS FINANCE SECRETARY, FORT ST. GEORGE, CHENNAI [2022 (12) TMI 1336 - MADRAS HIGH COURT] where it was held that The prayer for a direction to refund of tax already paid by the petitioner also cannot be countenanced as these petitioners are liable to tax. Therefore, wherever the Orders-in-Original have been passed, the respective petitioners are given liberty to file statutory appeal before the Appellate Authority subject to the compliance of the other requirements of pre-deposit the amount as is contemplated under Section 35F of the Central Excise Act, 1944 as made applicable to the Finance Act, 1994, within a period of thirty (30) days from the date of receipt of a copy of this order.
The Writ Petition is dismissed with liberty to the petitioner to file a statutory appeal before the appellate Commissioner under Section 85 of the Finance Act, 1994 within a period of 30 days from the date of receipt of a copy of this order.
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2024 (4) TMI 911
Seeking refund of accumulated Cenvat credit - input services or not - Judicial Discipline - The department had not accepted the judgement in the case of Paul Merchants and filed a Civil Appeal before the Supreme Court - HELD THAT:- The question of judicial discipline was examined by a three member bench of the Supreme Court in UNION OF INDIA VERSUS KAMLAKSHI FINANCE CORPORATION LTD. [1991 (9) TMI 72 - SUPREME COURT]. The Assistant Collectors in that case flouted the orders of the Appellate Collector on the ground that the order of the Appellate Collector were not acceptable to the department. The assessee filed a Writ Petition before the Bombay High Court which passed strictures against the Assistant Collectors. Union of India filed an appeal before the Supreme Court which upheld the strictures passed by the Bombay High Court.
Evidently, in this case, the Commissioner (Appeals) has refused to follow judicial discipline on the ground that the order of this Tribunal on the ground that it has not been accepted by the department. The very statement that a judicial decision is ‘not acceptable’ is an objectionable phrase as held by in Kamlakshi Finance and the Commissioner (Appeals) was bound to have followed the order of this Tribunal since it was not stayed, suspended or set aside by a higher court. By displaying gross judicial indiscipline, the Commissioner (Appeals) has caused considerable harassment to the appellant without any benefit to the Revenue. It is to curb this tendency that the Supreme Court had dealt with the issue at length in Kamalakshi Finance.
The impugned order is set aside - Appeal allowed.
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2024 (4) TMI 910
Levy of service tax - Works Contract Service - availment of Composition Scheme - GTA service - CENVAT Credit in terms of Rule 6(3) of CCR, 2004 - works Contract executed on or after 01.07.2012 under ‘other works contract’ - Credit denied on the ground that the documents prescribed under Rule 9(1) of the CCR were not submitted - suppression of facts or not - extended period of limitation.
Works Contract Service - availment of Composition Scheme on 25.01.2008 - HELD THAT:- W.e.f. 01.06.2007, the appellant has been discharging service tax liability on the said service under the “Composition Scheme”. In the absence of any laid down procedure under the law specifying the time limit, we observe that the payment of service tax itself should be construed as exercise of the option by the Appellant when such option was continued by the Appellant till the related works contracts were completed - this issue is squarely covered by the decision of the Tribunal, Delhi in the case of MEHTA PLAST CORPORATION VERSUS COMMISSIONER OF CENTRAL EXCISE, JAIPUR [2014 (5) TMI 1131 - CESTAT NEW DELHI] wherein it was held that “the option to be exercised is not required to be exercised in writing and the very fact of payment of duty under the composition scheme reflects upon the option of the assessee - the appellant is eligible for availment of Composition Scheme for payment of service tax and hence the demand confirmed in the impugned order by denying the benefit is not sustainable - demand set aside.
GTA service - HELD THAT:- The demand has been mechanically confirmed without verifying the documents submitted the appellant. The documents submitted by the appellant needs to be verified. The demand confirmed without verifying the documents is not sustainable. Accordingly, the demand confirmed in the impugned order on this count is set aside and the matter remanded to the adjudicating authority to verify the documents submitted by the appellant and determine the service tax liability, if any, after giving an opportunity to the appellant to explain their case. The appellant should also cooperate with the department and furnish all the documents for verification.
CENVAT Credit in terms of Rule 6(3) of CCR, 2004 - providing construction service to Airports Authority of India in Jammu & Kashmir and to Unitech Hi-Tech Structure Limited, an SEZ unit which are exempted services - HELD THAT:- The main objective of the Rule 6(1) is to ensure that the assessee should not avail the CENVAT Credit in respect of input or input services which are used in or in relation to provision of exempted services - In the present case, since the appellant has reversed the credit attributable to exempted services along with interest, the demand of an amount equivalent to 6/8% of the value of exempted services confirmed in the impugned order is not sustainable - the demand of reversal of CENVAT credit of Rs.37,91,781/- in the impugned order is set aside.
Works Contract executed on or after 01.07.2012 under ‘other works contract’ - HELD THAT:- The appellant is liable to pay service tax as ‘Original Works’ on the 40% value of such works contract as prescribed in Rule 2A(ii)A of the Valuation Rules. It is observed that the department has not brought in any evidence to substantiate the allegation that the contracts executed by the appellant were in the nature of completion and finishing service to demand service tax under ‘Other Works’ on the 60% value of such works contract as prescribed in the said Rules. Accordingly, the demand of service tax of Rs. 19,32,135/- (including Cess confirmed in the impugned order on this count is not sustainable and hence the same is set aside.
Credit denied on the ground that the documents prescribed under Rule 9(1) of the CCR were not submitted - HELD THAT:- The invoices were not checked by the audit team on the pretext that the documents are voluminous and will take lot of time and they have to conclude the audit within three days. The audit has concluded that the entire cenvat credit availed and utilised by the Appellant during the period 2009 – 10 to 2012 – 13 as irregular and the same has been confirmed in the impugned order. It is observed that the demand has been mechanically confirmed without verifying the documents submitted the appellant. The documents submitted by the appellant needs to be verified. The demand confirmed without verifying the documents is not sustainable - the demand confirmed in the impugned order on this count is set aside - the matter remanded to the adjudicating authority to verify the documents submitted by the appellant and determine the eligibility of Cenvat credit after giving an opportunity to the appellant to explain their case.
Suppression of facts or not - extended period of limitation - penalty - HELD THAT:- It is a settled position of law that when the matter involves interpretation of statutory provisions and the assessee acted on a bona fide belief, extended period of limitation cannot be invoked. We observe that there is no evidence available on record to invoke the extended period of limitation. Accordingly, the demand is not sustainable on the ground of limitation also. For the same reason, no penalty imposable on the appellant.
Appeal disposed off.
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2024 (4) TMI 909
Liability of appellant to pay service tax - vague SCN - SCN does not mention the category of service under which the demand has been proposed by the Department - HELD THAT:- On perusal of the Show Cause Notice as well as the order passed by the Adjudicating Authority and the Commissioner (Appeals), it is not found as to what is the category of service alleged to be rendered by the appellant. Merely because, the appellant received some amounts from M/s. Neyveli Lignite Corporation, it cannot be said that they have rendered service. In the Show Cause Notice, it is stated that the appellant rendered the activity of AMC of North Dump Yard, Afforestation and watching and up keeping of community halls. It is not clear what is the category of these services. The Department has not stated whether the activity falls within the definition of a particular category of service.
The Tribunal in similar set of facts had set aside the demand observing that when the category of service has not been mentioned in the Show Cause Notice, the demand cannot be sustained. In NPS CONSTRUCTION VERSUS COMMISSIONER OF CGST & CENTRAL EXCISE, PONDICHERRY [2024 (4) TMI 532 - CESTAT CHENNAI], the Tribunal followed the decision of the Hon’ble Supreme Court in the case of COMMISSIONER OF C. EX., BANGALORE VERSUS BRINDAVAN BEVERAGES (P) LTD. [2007 (6) TMI 4 - SUPREME COURT] wherein it was held that when the Show Cause Notice does not mention the specific category of service so as to inform the assessee about the allegations raised against them, the demand cannot sustain.
The impugned order is set aside - Appeal is allowed.
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2024 (4) TMI 908
Recovery of service tax alongwith interest and penalty - non-payment of service tax by suppressing the value of taxable service.
Demand confirmed for the reason that the appellant had accepted their liability for payment of service tax, and they had disputed the demand only on the account of quantification, in respect of which both the authorities have concluded that the appellant had failed to substantiate their claim by producing the relevant records for verification.
HELD THAT:- The appellant has during the period prior to 16.06.2005, issuing invoices, claiming the service tax from their service recipient. On Invoice No 13-18/2005-06 dated 26.05.05 Service Tax of Rs 6377.00/- has been charged as per the above chart on a taxable value of Rs 189439/- and on invoice No 19/05-06 dated 26-May-05 a service tax of Rs 23,795/- has been collected. During the period prior to 16.06.2005 appellant as per his own submission has collected service tax of Rs 30,172/- on the taxable value of Rs 462239.00. As appellant was himself charging and collecting the service tax, even prior to 16.06.2005, the claim for deduction made by the appellant for deducting this value from the taxable value cannot be acceded to.
Thus the gross value of taxable service on which the demand of service tax is made, after allowing the deductions in respect of PF, Bonus and Service Tax paid by M/s Hindalco, as per the chart submitted by the appellant comes to Rs 63,90,554.77/- (Rs 1,77,87,709.00 - Rs 15,16,602.00 – Rs 10,45,027.23 - Rs 88,35,525). The demand has been made by taking table value of Rs 64,41,735/-. There are not much difference in the taxable value determined by the department for making the demand and the taxable value that can be determined on the basis of the chart submitted by the appellant.
In case of COMMISSIONER OF C. EX., MADRAS VERSUS SYSTEMS & COMPONENTS PVT. LTD. [2004 (2) TMI 65 - SUPREME COURT] Hon’ble Supreme Court has held Once it is an admitted position by the party itself, that these are parts of a Chilling Plant and the concerned party does not even dispute that they have no independent use there is no need for the Department to prove the same. It is a basic and settled law that what is admitted need not be proved.
There are no merits in the appeal - appeal dismissed.
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2024 (4) TMI 907
Non-payment of service tax - suppression of value of taxable service provided - demand confirmed for the reason that the appellant had accepted their liability for payment of service tax, and they had disputed the demand only on the account of quantification, in respect of which both the authorities have concluded that the appellant had failed to substantiate their claim by producing the relevant records for verification.
HELD THAT:- The major deduction which has been claimed by the appellant from the gross value of taxable services is on the account of services provided by them before the same became taxable, specifically the services under the category of Supply of Tangible Good services. These service became taxable with effect from 16.05.2008. Appellant have claimed that the value of the taxable services provided by them under this category for the period prior to levy of service tax. Was about Rs 84,17,327.67. If the claim of the appellant is admitted the gross value of taxable service will be reduce substantially. Appellants had made this claim before the adjudicating authority and the first appellate authority and had submitted a chart duly certified by a Chartered Accountant, showing that the during the entire period of dispute the invoices issued by the appellant were in respect “Truck, Tractor, Dumper Hiring Charges” on some of the invoices even the registration number of vehicle was also mentioned.
The coverage of the services under the category of taxable service was gradually widened, every year. Appellants have claimed that the major chunk of the services provided by them were within this category and specified as taxable service only from 16.05.2008. As no finding has been rendered by the adjudicating authority or the first appellate authority on this aspect, while adjudicating the case, the matter needs to be remanded back to the original authority for recording specific findings on this issue.
The matter remanded back to the original authority for reconsideration of the issue to the extent of allowing deduction of Rs. 84,17,327.67/- which appellant claim were received by them against the services of “Supply of Tangible Goods service” prior to 16.05.2008, the date from which the service was made taxable - Appeal is partly allowed to the extent of remanding the matter to original authority.
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2024 (4) TMI 906
Liability of sub-contractor to pay service tax - main contractor discharges tax on the gross value - Extended period of limitation - suppression of facts or not - penalties - HELD THAT:- After issue of the Circular No. 96/7/2007-S.T. dated 23.08.2007, there is no ambiguity regarding the liability of a sub-contractor to pay Service Tax even in cases where the main contractor pays Service Tax on the gross value. The demand involved in this Notice pertains to the period from 2007-08 to 2011-12 i.e., after the issue of the Circular mentioned hereinabove. Thus, the submission of the appellant that they were not aware of the liability to Service Tax as a sub-contractor, is not agreed upon.
The Larger Bench of the Tribunal in the case of Commissioner of Service Tax v. M/s. Melange Developers Pvt. Ltd. [2019 (6) TMI 518 - CESTAT NEW DELHI-LB] has decided that even when the main contractor has discharged Service Tax, the sub-contractor is required to pay Service.
In view of the decision of the Larger Bench and by relying on the Board Circular, it is held that the sub-contractor is liable to pay Service Tax even if the main contractor pays Service Tax on the gross value of the services.
Extended period of limitation - suppression of facts or not - penalties - HELD THAT:- The appellant has been filing their returns regularly, thereby intimating the liability to Service Tax. Thus, no suppression of facts with intention to evade payment of tax exists in this case - the extended period of limitation cannot be invoked against the appellant. For the same reason, the penalties imposed on the appellant are set aside.
Appeal disposed off.
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2024 (4) TMI 905
Invocation of Extended period of Limitation - Suppression of facts or not - Classification of services - real time courses provided by the Appellant - Online information and data base access and/or retrieved service (OIDAR service) or commercial training or coaching service? - HELD THAT:- On perusal of the facts in the instant case, we note that the appellant was asked to submit copies of their Balance Sheet for the period 2007–2008, along with the details of the payments collected from clients/members on account of each of the services provided by them from 1.4.2007 to Sept 2008 and list of members and clients from whom such payments had been collected. It is seen that the appellant did not reply to the letter nor did they supply the requisite information. This was followed up with letter dated 23.02.2009 requesting the appellant to furnish the details on the gross amount collected and the amount on which service tax had been paid during the period 01.4.2007 to 31.01.2009. As the appellant did not cooperate, it is seen that the Asst Commissioner of Service Tax, Division – 1, issued a show cause notice dated 05.3.2009 under Section 77 of the Finance Act, 1994 for non-furnishing of information. Following the receipt of this notice, the appellant filed their letter dated 17.3.2009 and supplied certain information. The Department took a view that the information supplied by the appellant prima-facie was incorrect and grossly undervalued.
Having two sets of annual financial statement showing different figures clearly establishes the malafide intent of the appellant to mislead the investigations. Further, it is noted that the details as submitted by the appellant vide their letter dated 17.3.2009 was incorrect and the allegation of suppression of the taxable value is substantiated by the adjudicating authority in the impugned order.
The Supreme Court’s explained “suppression of facts" in PUSHPAM PHARMACEUTICALS COMPANY VERSUS COLLECTOR OF C. EX., BOMBAY [1995 (3) TMI 100 - SUPREME COURT], wherein the Apex Court examined whether the Department was justified in initiating proceedings for short levy after the expiry of the normal period of six months by invoking the proviso to section 11A of the Excise Act. The proviso to section 11A of the Excise Act carved out an exception to the provisions that permitted the Department to reopen proceedings if the levy was short within six months of the relevant date and permitted the Authority to exercise this power within five years from the relevant date under the circumstances mentioned in the proviso, one of which was suppression of facts. It is in this context that the Supreme Court observed that since “suppression of facts’ has been used in the company of strong words such as fraud, collusion, or wilful default, suppression of facts must be deliberate and with an intent to escape payment of duty.
The intention of the appellant to deliberately escape payment of tax is corroborated by the fact that two sets of Balance Sheets for the same year showing different figures of income were found during the search operations. The contention that the department had relied on the data which was based on the statement of Mr. Manoj Kumar Satyawali who is not a technical expert to generate such figures from the server, is not acceptable as the employee was working as Technical Support Executive-Customer Care and was incharge of the in-house server. In his statement, he has stated that he can only extract data, but did not have the power to amend or change the data. Therefore, the demand confirmed for by the instant show cause notice is liable to be upheld.
The activity undertaken by the appellant from April 2009 was that of basic learning programs which were pre-recorded on a CD/DVD. The customers/subscribers may use such CD/DVD for their learning nothing more than this is being undertaken. From the above, it is noted that the activity being undertaken by the appellant is a sale and did not involve any service. For the period till 30.6.2012, vide Not No. 12/2003 ST, the value of goods, if any, was to be deducted for the levy of service tax. It is also noted that service tax and VAT are mutually exclusive taxes, and therefore levy of one would exclude the other - It has also been brought to notice that the subsequent show cause notices for the period 2013–14 and 2014–15 have been decided in the appellant’s favour. It is also been pleaded that these orders have not been challenged by the department and have hence attained finality. It is also noted that the appellant did not have any authorised training centres as well. Consequently, the demand under Franchise service confirmed in respect of the demand notice dated 17.10.2011 does not survive.
The demand confirmed in respect of the show cause notice dated 21.4.2010 for the period 2007-08 and 2008-09 along with interest, and equal penalty imposed under section 78 is upheld - the issue relating to quantification of the demand taking into consideration the contentions regarding cum-duty tax is remanded to the adjudicating authority for recalculation of demand and consequently the amount of penalty under Section 78 of the Finance Act, 1994 - the demand confirmed under the remaining 5 show cause notices set aside - appeal is allowed partially by way of remand.
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2024 (4) TMI 864
Classification of services - transporting coal from one location to another - GTA services or cargo handling service - reverse charge mechanism - HELD THAT:- When WCL required a service provider to move the coal from one location to another and for this purpose, engaged the service of the appellant, the essential part of the contract is of transportation. Loading and unloading are incidental to it. Loading and unloading per se are of no use except when they are in conjunction with the transportation. The intention of the WCL is to transport coal and in the process, it also gets loaded on to the truck and unloaded at the destination.
While the activities such as packing, loading, unloading and unpacking may take substantial time and may even take longer than the actual transportation, the main purpose of the contract is to transport the goods from the old to the new residence which is the essential character of the service and packing, loading, unloading and unpacking are mere incidental activities to the main function of transportation.
WCL has already paid service tax on reverse charge basis on the transportation of coal under reverse charge. Therefore, the demand of service tax on the same service again from the appellant classifying it as “cargo handling service’ cannot be sustained.
The impugned order is set aside - appeal allowed.
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