TMI Blog2022 (8) TMI 104X X X X Extracts X X X X X X X X Extracts X X X X ..... L ORDER NO.75422/2022 - Dated:- 27-7-2022 - SHRI SANJIV SRIVASTAVA, TECHNICAL MEMBER AND SHRI P.DINESHA, JUDICIAL MEMBER Shri N.K.Chowdhury, Advocate for the Appellant Shri J.Chattopadhyay, Authorized Representative for the Respondent ORDER The present Miscellaneous Application for submission of additional evidence is rejected. With the consent of both sides, the appeal is taken up for final disposal. 2. This appeal is directed against the Order-in-Original No.32- 35/ST/Commr./2013 dated 28.03.2013 passed by Commissioner of Central Excise Service Tax, Ranchi. By the impugned order, the Commissioner has held as follows : ORDER 24. In view of above discussion and findings, I pass the following order, - (i) I confirm the demand of Service Tax totally amounting to Rs.1,29,47,706/- (Rs.One Crore Twenty nine lakh Forty seven thousand seven hundred six) [Rs.1,26,72,490/- as service tax, Rs.2,50,661/- as education cess, Rs.24,555/- as secondary higher education cess] only as demanded vide the instant four SCNs under Section 73(1) of Chapter V of the Finance Act,1994. (ii) I impose penalty amounting to Rs.1,29,47,706/- (Rs.One Crore Twent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dt. 24.10.2011 Oct.2009 to Sept. 2010 372732 7455 3727 Total 12672490 250661 24555 3.3 The show-cause notice was adjudicated by the Commissioner as per the impugned order referred to above in Para 1. Being aggrieved, the appellants have filed this appeal before us. 4. We have heard Shri N.K.Chowdhury, Ld.Advocate for the appellant and Shri J.Chattopadhyay, Ld.Authorised Representative for Revenue. 5. After hearing from both sides, we find that the issue involved in this appeal is squarely covered in favour of the appellant by various decisions of this Tribunal. The South Zonal Bench of this Tribunal in the case of R.Venkataramanan Vs. Commissioner of Central Excise, Trichy : 2009 (13) STR 187 (Tri.-Chennai) has held as under : 5 . The facts of the case are that during the period 7/2003 to 12/2005 the appellant was engaged in sale of SIM cards received from M/s. BSNL. From the order of the original authority, it is seen that the face value of the SIM cards includes its 5% allowed as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the customers is subjected to service tax which is paid by the BSNL. Therefore, the finding that the appellant is promoting the business of sale or service of BSNL is misconceived. The impugned order is therefore not consistent with law. I also find that in South East Corporation v. CCE ST, Cochin case (supra) this Tribunal had held as under : There is no service carried out by the appellants but actually they have done the activity of purchase and sale which comes within the purview of sale of goods‟ and sales tax is attracted. The Commissioner (Appeal) s finding that the appellant is doing the activity af marketing and distribution of products and it comes within the ambit of Business Auxiliary Service is not correct finding especially, in the light of the appellants having paid full value for the Sim Cards to the BSNL and sold the same on the profit margin. The ratio of R.B. Agencies v. CCE., Calicut (supra) was also to the same effect. Following the ratio of the above decisions I allow the appeal. Stay application also gets disposed of. The Chennai Bench of this Tribunal in the case of M/s JR Communications Power Controls Vs. Commissioner of C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Tribunal in the case of Karakkattu Communications (supra). The Tribunal held as under :- The stay application and appeal are taken up together for disposal as per law. The appellants were acting as distributors of cellular mobile telephone service for and on behalf of BSNL as per the agreement entered into between them during the period July 03 to December 04. Their services have been brought under the category of business auxiliary services.‟They are contesting the matter on the ground that the service tax has been discharged by BSNL and they were not getting Commission but were trading in the cards. They were discharging sales tax. Learned counsel relies on the ratio of the ruling of South East Corporation v. CCE by Final Order No. 610/2007 dated 25-5-07 in respect of identical issue and she says that this bench has already decided the case in assessee‟s favour. The said final order refers to the clarification given by BSNL about discharge of service tax on sim cards sold to the distributors. 2. Heard learned DR who defends the order. 3. We have gone through the cited final order. The findings recorded in para 2 are reproduced herein below. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecisions of this Tribunal in the case of GR Movers v. Commissioner of Central Excise, Lucknow [2013 (30) S.T.R. 634 (Tri.-Del.)] and Daya Shankar Kailash Chand v. Commissioner of Central Excise Service Tax, Lucknow [2013 (30) S.T.R. 428 (Tri.-Del.)]. The Hon‟ble High Court of Allahabad has upheld these two decisions. 7 . We find that this contrived distinction attempted in the impugned order by the first appellate authority does not conform to logic or to any commercial distinction. On the contrary, the three decisions cited above are clear in laying down the principle that the user of the telephony services is the service recipient and tax liability on the gross value charged from such customer, whether first-time purchaser of SIM card or subsequent purchaser of other cards, is collected from the customer and deposited to Government account by the principal. An attempt has been made to catalogue the various activities that devolve on the appellants in relation to activation of SIM cards without appreciating the fact that the SIM cards are marked with an MRP on which tax is collected in full from the customer. Therefore, the commission paid to appellants is also in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the attention of the Tribunal? And finally the Hon ble Madras High Court has concluded the matter by stating as follows : 3. When this appeal is taken up for hearing, it is brought to the notice of this Court by the learned counsel appearing for the appellant that similar question has been considered by the CESTAT Principal Bench, New Delhi, in the case of G.R. Movers v. Commissioner of Central Excise, Lucknow, reported in 2013 (30) S.T.R. 634 ( Tri.-Delhi) and the issue has been answered against the Revenue and in favour of the assessee. The relevant portion of the order reads thus, 23. The argument of the distributors in the present case is not as unreasonable as illustrated in the example discussed above. The following aspects need to be noted in this regard. This is not a case where the distributor is doing a service, billing for it, collecting the charges for the service and then BSNL charging for the services to the customers through a separate process. On the contrary this is a case where BSNL sells the cards through the distributor and collects money from customers through the distributor and then pays to the distributor out of consideration received by t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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