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Service Tax - Case Laws
Showing 41 to 60 of 71 Records
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2021 (2) TMI 457
CENVAT Credit - input services - credit of the service tax charged on the input service was taken by the Appellant, for purposes of adjusting the same against its output service tax liability on the provision of transportation of gas through pipeline - Whether the Tribunal committed an error in entertaining the ground of the respondent M/s. GSPL on such question of CENVAT credit in a Rectification Application and whether the Tribunal can be stated to have corrected the error apparent on the face of record? - HELD THAT:- The appellants are engaged in the business of transporting gas through pipe line. For the purpose of transporting gas through pipe line it is essential for them to lay pipe lines between their different station. For the purpose of laying pipeline the appellants engage various contractors to procure pipes and completed the activity of laying the pipeline. In this process these contractors get the price of material used by them and all the services provided by them. These contractors pay service tax on the services provided by them to the appellant. These contractors take services from various sub contractor. The issue before us is if the appellants are entitled to take the credit of service tax paid by these contractors directly supplying services to the appellant for the purpose of laying pipeline. The fundamental objection of the revenue is that pipelines are immovable property and not goods and therefore, any service tax paid on such installation cannot be claimed as input credit by the appellant.
It is seen that the issue involved in the instant case is squarely covered by the decision of tribunal in the appellant’s own case GUJARAT STATE PETRONET LTD. VERSUS COMMR. OF C. EX. & S.T., AHMEDABAD [2013 (9) TMI 1171 - CESTAT AHMEDABAD]. The said decision was also approved by Hon’ble High Court. The Learned Special Counsel for revenue has argued since the Hon’ble Apex Court has issued notice, the decisions of tribunal and Hon’ble High Court cannot be applied to the instant case - there are no force in this submission as the decision of Hon’ble High Court has not been stayed. The second issue raised by the Learned Special Counsel is that tribunal solely relied on the decision of AP High Court in the case of COMMR. OF C. EX., VISAKHAPATNAM-II VERSUS SAI SAHMITA STORAGES (P) LTD. [2011 (2) TMI 400 - ANDHRA PRADESH HIGH COURT], and that the decision in the case of Sai Samhita Storages Pvt Ltd relates to ‘inputs’ and not ‘inputs services’ - We do not find any merit in argument of Learned Special Counsel. The decision of tribunal upheld by Hon’ble High Court in Appellant’s own case is comprehensive in all respects. In view of the fact that the decision in the case of Sai Samhita Storages Pvt Ltd was examined by the co-ordinate bench of tribunal and the said decision has been approved by the Hon’ble High Court.
There are no merit in the impugned order - appeal allowed - decided in favor of appellant.
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2021 (2) TMI 455
Levy of Service Tax - erection, commissioning and installation services - commercial or industrial construction services - consultancy engineering services - contracts which are turnkey contracts and involve both supply of goods and provision of services and when the amounts payable for services are mentioned separately and amounts payable for the goods are mentioned separately - argument of the Revenue is that the contracts are divisible not only between the different individual companies of the consortium but also between the supply of goods and rendering of services, these cannot be treated as composite works contracts.
HELD THAT:- Identical matter came up before this Bench in respect of same assessee in the case of M/S BEEKAY ENGG. CORPN. LTD. VERSUS CCE, RAIPUR [2018 (1) TMI 1620 - CESTAT NEW DELHI] where it was held that prior to June, 2007 the ‘Works Contract Services’ were not subjected to Service Tax - The learned Commissioner should have followed the ratio of the above decision which were binding on him. Learned Counsel for the appellant has demonstrated that these cases were specifically cited before learned Commissioner but no finding has been given as to why they were not being followed.
Learned Commissioner, however, sought to distinguish the case of the appellant from the judgement of the Supreme Court in the case of COMMISSIONER, CENTRAL EXCISE & CUSTOMS VERSUS M/S LARSEN & TOUBRO LTD. AND OTHERS [2015 (8) TMI 749 - SUPREME COURT] - In our view, when the applicability of judgement of the Supreme Court in the case of Larsen and Toubro Ltd. to the appellant‟s case has been decided by this Tribunal, judicial discipline required the Commissioner to follow it. He just ignored it.
The impugned order is not sustainable and needs to be set aside - Appeal allowed - decided in favor of appellant.
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2021 (2) TMI 406
Rejection of declaration of the petitioner filed under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - SVLDRS - Stand taken is that investigation into the allegation of short payment of service tax by the petitioner was going on and the amount of duty involved had not been quantified on or before 30.06.2019 - period from April 2014 to March 2017 - HELD THAT:- In Thought Blurb Vs. Union of India [2020 (10) TMI 1135 - BOMBAY HIGH COURT] it was held that the petitioner was eligible to file the application (declaration) as per the scheme under the category of enquiry or investigation or audit whose tax dues stood quantified on or before 30th June, 2019.
It is evident that all that would be required for being eligible under the above category is a written communication which will mean a written communication of the amount of duty payable including a letter intimating duty demand or duty liability admitted by the person concerned during enquiry, investigation or audit - That apart, in Thought Blurb, It is held that when there is a provision for granting personal hearing in a case where the declarant disputes the estimated amount, it would be in complete defiance of logic and contrary to the very object of the scheme to reject a declaration on the ground of being ineligible without giving a chance to the declarant to explain as to why its declaration should be accepted and relief under the scheme be extended to him.
The matter remanded back to respondent Nos.3, 4 and 5 to consider the declaration of the petitioner dated 30.12.2019 in terms of the scheme as a valid declaration under the category of investigation, enquiry and audit and thereafter grant the consequential relief(s) to the petitioner - appeal allowed by way of remand.
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2021 (2) TMI 400
Works Contract - Classification of services - Scope of Show Cause Notice (SCN) - whether the projects undertaken by the appellant would fall in the classification alleged in the show cause notices or would be more appropriately classifiable under “works contract”, if the contracts involved both goods as well as services? - HELD THAT:- The Supreme Court in COMMISSIONER, CENTRAL EXCISE & CUSTOMS VERSUS M/S LARSEN & TOUBRO LTD. AND OTHERS [2015 (8) TMI 749 - SUPREME COURT] noted that a “works contract” is different from a contract for service simpliciter and could be subjected to service tax only with effect from June 1, 2007.
The Commissioner has recorded a categorical find that each of the “works contract” undertaken by the appellant are not covered under the three services namely (i) commercial or industrial construction, (ii) construction of complex and (iii) management, maintenance or repair mentioned in the first show cause notice. The Commissioner further recorded a categorical finding that the activities undertaken by the appellant would be classifiable as “works contract” as they involved goods as well as labour services - The Commissioner therefore, dropped the demand for the period prior June 1, 2007. But for the demands for the period w.e.f. June 1, 2007 the Commissioner proceeded to examine whether the particular work performed under “works contract” is exempted from levy of service tax under Notifications issued from time to time.
A Division Bench of the Tribunal in M/S GURJAR CONSTRUCTION VERSUS COMMISSIONER CENTRAL EXCISE, JAIPUR-II [2019 (5) TMI 717 - CESTAT NEW DELHI] also examined such a position and observed that a demand made under a particular category cannot be sustained under a different category - In view of the aforesaid decisions of the Tribunal, it has to be held that the Commissioner was not justified in confirming the demand of service tax under the category of “works contract” for the period post June 1, 2007 even if the levy of service tax was not exempted under Notifications, since, the show cause notice that demand it service tax under the three categories namely (i) commercial or industrial construction, (ii) construction of complex and (iii) management, maintenance or repair.
The order dated January 31, 2018 passed by the Commissioner that has confirmed the demand of service tax, therefore, deserves to be set aside and is set asid - appeal allowed - decided in favor of appellant.
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2021 (2) TMI 399
Rebate of Service tax paid - services exported between December, 2008 to March, 2009 and June, 2008 to March, 2009 - privity of contract - argument of Revenue is that although the client is located abroad and services are being paid for in foreign currency, the actual service is being rendered in India, therefore, this does not qualify as export of service and no rebate is available - HELD THAT:- This issue is no longer res integra as this Bench had in respect of the same assessee, in M/S. SAMSUNG INDIA ELECTRONICS P. LTD VERSUS CCE. NOIDA [2015 (1) TMI 1098 - CESTAT NEW DELHI] where it was held that such services qualify as export of services.
Revenue’s argument is that they have filed an SLP against this order of the Tribunal and, therefore, it should not have been followed by the Commissioner (Appeals) in the impugned order. There are nothing on record that the order of this Tribunal has either been stayed or set aside by the Hon’ble Supreme Court or any High Court and, therefore, the ratio holds good - Therefore, Commissioner (Appeals) has correctly followed the ratio and held that rebate is admissible on the export of service.
Appeal dismissed - decided against Revenue.
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2021 (2) TMI 379
SVLDRS - Eligibility of the declarant for making a declaration under the category of ‘investigation, enquiry or audit’ or maintainability of such declaration on the ground that the amount of tax dues was not quantified on or before 30.06.2019 - Rejection of Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - HELD THAT:- In THOUGHT BLURB VERSUS UNION OF INDIA AND ORS. [2020 (10) TMI 1135 - BOMBAY HIGH COURT], this Court faced with a similar issue and it was held that there is a letter of respondent No.3 to the petitioner quantifying the service tax liability for the period 1st April, 2016 to 31st March, 2017 at ₹ 47,44,937.00 which quantification is before the cut off date of 30th June, 2019 and on the other hand for the second period i.e. from 1st April, 2017 to 30th June, 2017 there is a letter dated 18th June, 2019 of the petitioner addressed to respondent No.3 admitting service tax liability for an amount of ₹ 10,74,011.00 which again is before the cut off date of 30th June, 2019. Thus, petitioner’s tax dues were quantified on or before 30th June, 2019 and there are no hesitation to hold that petitioner was eligible to file the application (declaration) as per the scheme under the category of enquiry or investigation or audit whose tax dues stood quantified on or before 30th June, 2019.
In the present case, the petitioner in its letter dated 10.05.2019 had clearly admitted service tax dues of ₹ 64,72,543.00 for the period under consideration. This acknowledgment or admission by the petitioner was before the cut-off date of 30.06.2019. In fact, in the final audit report dated 07.11.2019, reference has been made to this letter dated 10.05.2019 wherein petitioner had admitted service tax liability of ₹ 64,72,543.00. Though the final audit report may be post 30.06.2019, the admission of the petitioner was certainly prior to 30.06.2019 - rejection of the declaration of the petitioner dated 02.12.2019 by the designated committee on 12.02.2020 is not justified.
Petition allowed.
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2021 (2) TMI 377
Maintainability of appeal after compliance with the pre-deposit - stay of the tax dues - Section 35F of the Central Excise Act - HELD THAT:- Since an order of adjudication has been passed by the competent authority/respondent no.2, petitioner should avail the remedy of appeal and make a pre-deposit for getting stay of the impugned demand. Needless to say, if such a request for supply of login ID has been made by the petitioner, the same should be considered by the competent authority / respondent no.2 in accordance with law, without any delay. The petitioner is granted liberty to approach the respondent no.2 after filing of the appeal and the necessary pre-deposit of 7.5% for seeking a recall of the notices at Annexure-2 and 5 respectively or for keeping it in abeyance, which may be considered in accordance with law as expeditiously as possible.
Petition disposed off.
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2021 (2) TMI 367
Refund of Service Tax - time limitation - whether the appellant had submitted the application for refund of service tax within the stipulated time since the application filed for refund has been rejected for the sole reason that it was not submitted within the time prescribed? - Section 83 of the Finance Act - HELD THAT:- Though section 11B of the Excise Act has been mentioned in section 83 of the Finance Act, but what needs to be noticed is that the provisions of the Excise Act would apply, so far as may be, in relation to service tax as they would apply in relation to a duty of excise. Thus, if there is a specific provision in the Finance Act itself for claiming refund of service tax, the provisions of section 11B of the Excise Act dealing with refund would not apply. There cannot possibly be two time limits prescribed for making an application for refund of service tax. When the time limit prescribed in sub-section (3) of section 102 of the Finance Act or sub-section (3) of section 104 of the Finance Act is applicable, the time limit prescribed in section 11B of the Excise Act would not be applicable.
Stipulation in section 83 of the Finance Act that the certain sections of the Excise Act shall apply so far as may be, in relation to service tax as they apply in relation to duties of excise have not been examined. Though section 102 or section 104 of the Finance Act do not prescribe any format but a procedure for filing an application for refund of service tax has been prescribed in the Trade Notice and the Circular. It is also not the case of the appellant that the appellant was not aware of the procedure since it is the appellant that had placed the Trade Notice and the Circular - Such being the position, it is not possible to hold that the limitation for making an application for refund of service tax would be that as provided in section 11B of the Excise Act. The Application for refund of service tax has to be made within the period stipulated in sub-section (3) of section 102 of the Finance Act.
Whether the appellant had submitted the application for refund of service tax online on October 13, 2016? - HELD THAT:- In order to transact the business of ACES, a user has to first register through a process called “Registration with ACES”. Detailed steps for taking registration have also been provided. The system generates a registration number and it is only thereafter that an assessee can transact business through ACES. The appellant has enclosed a copy of the application, which the appellant contends was submitted online. Registration Number has, however, not been indicated by the appellant. The appellant, therefore, could not have transacted any business through ACES. This procedure for registration has also been prescribed in the Circular dated March 23, 2010, which has also been relied upon by the appellant - It also transpires that from a perusal of the Trade Notice that an assessee can electronically file a statutory return by either filing it online or downloading off-line return utilities which can be filled-in off-line and uploaded to the system through internet. The returns uploaded through this procedure are validated by the ACES before acceptance into the system and an assessee can track the status of the return by selecting the appropriate option in the sub-menu which would show the status as “uploaded” which means under process by ACES, or “filed” which means successfully uploaded. The appellant has not stated that the online application was successfully uploaded. It also provides that in case of any difficulty in accessing ACES application, an assessee can seek the help of the Service Desk.
It is, therefore, clear that though an attempt was made by the appellant to submit the application online but the process that was required to be undertaken for making an application online was not complied to with as even the regulation was not done. The application cannot be treated to have been filed on time. If there was any difficulty in submission the application, the appellant could have sought the help of the help desk but the appellant has not stated that he made an attempt to seek help - appellant, therefore, cannot contend that the online application was actually made on October 13, 2016 as there is nothing on the record to substantiate that such an application was actually filed.
The appellant filed a hard copy of the application only on December 20, 2016 in the office of the Assistant Commissioner and the records do indicate that correspondence did take place between the Department and the appellant in connection with this application. This Application was filed beyond the period prescribed in sub-section (3) of section 102 of the Finance Act. In the absence of any provision for condoning the delay in filing the application, the Commissioner (Appeals), committed no illegality in upholding the order passed by the Assistant Commissioner rejecting the application filed by the appellant for refund of service tax on the ground that it was not filed within the time stipulated - Appeal dismissed.
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2021 (2) TMI 300
Refund claim - time limitation - appeal not filed within 6 months from the date of the Finance Bill, 2016 received the assent of the President i.e. by 13.11.2016 - validity of refund only to the service provider and not to the party being the service recipient - relevant date for claiming Service Tax refund - output services in the instant case were fully tax exempt - retention of CENVAT Credit - refund of exports as provided under Rule 5 of the CCR, 2004 - Section 103 of the Finance Act, 1994 - HELD THAT:- Undisputedly the appellant in the present case is the service recipient, who has paid the service tax against the invoices issued to them by the service providers. The service providers have in turn collected the service tax and deposited the same as per the assessment made by them in their ST-3 return. These ST-3 returns which are self assessed have been filed by the service provider and there is no appeal filed by any person aggrieved by the said self assessment order.
Counsel for the appellant submitted that what they are claiming is the refund of the accumulated CENVAT Credit which has accumulated in their credit account for the reason of the payment of service tax which was not due from them. The argument of the counsel though appears attractive but needs to be rejected at the first instant itself, because as per the CENVAT Credit rule the refund of accumulated CENVAT Credit is permitted only as per the Rule 5 of the CENVAT Credit Rules, 2004 and definitely the case under consideration cannot be said to be the case in terms of Rule 5 - Appellant submitted for getting the refund applications processed they had reversed the entire amount claimed as refund by them from their Input Tax Credit Ledger under GST regime. This fact is not in dispute. In fact the details of the debits made by the appellants from their ITC Ledger, have been recorded by the Assistant Commissioner in his order. Since we hold that the refund applications as such are not maintainable, Assistant Commissioner should consider restoring the input tax credit so debited by the appellant to them if permissible in the GST Law.
With regards to the CENVAT Credit has been adjudged subsequent to changeover from the previous regime of Central Excise and Service Tax to the regime of GST. In all the cases the refund application or the rebate claim was filed before 01.07.2017 and determined subsequent to that date. It is not so in the present case. In the case of the appellant the CENVAT credit was available in the book of accounts of the appellant and had been carried forward by them to the GST regime, in manner as provided under the GST Law.
The appellants for the processing of the refund claims have not debited the CENVAT account, but have debited the amounts from their Input Tax Credit Ledger. Hence in our view there is no case for cash refund of the amounts debited from the Input Tax Credit Ledger - the matter is remitted back to the original authority for considering allowing the re-credit of the amounts of ITC Credit debited by the Appellant for the processing of these refund applications, if permissible under the GST Law - Appeal disposed off.
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2021 (2) TMI 253
Valuation - management, maintenance or repairs or not - activity of providing parking facility in the Malls - whether the Mall owners receive any payment or consideration from the appellant or not - extended period of limitation - HELD THAT:- Issue notice, returnable within four weeks.
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2021 (2) TMI 252
Rejection of application (declaration) filed under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - eligibility of declaration under the category of investigation, enquiry or audit - whether the writ applicant was eligible to avail the benefit of the scheme under the category of investigation, enquiry or audit? - HELD THAT:- It is required to be noted that, at the time of issuing the letter dated 28.06.2019, there is no any whisper by the authority that, the amount fixed as a duty was subject to further audit. We also take the notice of the fact that, while issuing statement in Form SVLDRS-2, after considering the declaration made by the writ applicant, the amount payable ₹ 1,22,18,781.05/ determined and estimated by the authority and the same amount reflected in the impugned Form SVLDRS-2. Therefore, at the one hand, while issuing statement in Form SVLDRS-2 by the Designated Committee estimated the amount equal to the amount declared by the writ applicant in Form SVLDRS-1 i.e. ₹ 1,22,18,781.05/ and on the other hand, without any clarification, one note appended to the Statement in Form SVLDRS-2 mentioning therein that, there was a variance in the quantification of the amount under the draft audit report and letter dated 28.06.2019. If the authority did not have agreed with the amount as declared by the writ applicant, then they should not estimated the amount equal to the amount declared by the writ applicant or they could have been estimated the higher amount against the amount declared by the writ applicant.
The communication dated 28.06.2019 would indicate that the respondent No.1 had quantified the amount by way of written communication. Referring to the Circular of the Board dated 27.08.2019, more particularly para 10 (g) of the said Circular, clarified in the context of various provisions of the Act, 2019, that, “the cases under an enquiry, investigation or audit, where the duty demand has been quantified on or before 30th day of June, 2019 are eligible under the scheme. Section 2(r) defines “quantified” as a written communication of the amount of duty payable under the indirect tax enactment. It is clarified that, such written communication will include a letter intimating duty demand; or duty liability admitted by the person during enquiry, investigation or audit or audit report etc.” Therefore, we hold that, in the instant case, the respondent No.1 had quantified the tax amount payable by the writ applicant and same was communicated by way of letter dated 28.06.2019. Thus, the tax dues were quantified on or before 30th June, 2019. In such circumstances, we have no hesitation to hold that, the writ applicant has duly complied with the eligibility criteria laid down under the SVLDRS Scheme, 2019 and the writ applicant was eligible to file an application as per the Scheme under the category of investigation, enquiry or audit.
Action of the respondent No.1 in issuing statement in Form SVLDRS-2 was against the provisions of the Finance Act, 2019 and Rules thereunder - HELD THAT:- After filing the application in statement in form SVLDRS-1 intimating the total tax dues of ₹ 2,52 95,051/ based on the amounts quantified and communicated to the writ applicant by letter dated 28.06.2019, the net amount payable by the writ applicant was mentioned ₹ 1,22,18,781.05/ and in response to the declaration, the Designated committee had estimated the same amount declared by the writ applicant and the same was confirmed by the writ applicant in issuing the statement in Form SVLDRS-2. Therefore, when the liability of tax amount estimated by the authority equal to the amount declared by the writ applicant, then, there is no reason for the authority to issue statement in Form SVLDRS-2. The respondent No.1 tried to defend the issuance of statement in Form SVLDRS-2 in their reply stating, inter alia that, the statement in Form SVLDRS dated 07.02.2020 was issued for the clarification with regard to the quantification amount was in variation with quantification letter dated 28.06.2019.
Opportunity for personal hearing - HELD THAT:- As per the provision, if declarant is not agree with the amount determined by the Designated Committee, he having given right to hearing to explain why he is not agree with the estimated amount determined by the Designated Committee - In the instant case, there is no dispute with regard to estimated amount determined by the Designated Committee. Notice for hearing was for the limited issue with regard to agreement or disagreement with the estimated amount determined by the authority. Record shows that, in statement in Form SVLDRS-2, no specific notice for affording the opportunity of hearing was given to the writ applicant with regard to variance of quantified amount - there is no hesitation in holding that the action of the respondent No.1 issuing statement in Form SVLDRS-2 is in contravention of the Section 127 (1) read with Rule 6 (2).
The decisions of rejecting the application by the respondent No.1 were in violation of principles of natural justice. It appears from the record that, no specific amount of variance being brought into notice of the writ applicant. The only remarks appended to the statement in Form SVLDRS-2 without any specification, is not sufficient to hold that, the principles of natural justice have been complied by the respondent No.1. The contents of the rejection letter would go to show that, in the absence of any clarification on the part of the Designated Committee, the application was rejected. In this circumstances, we are of the view that, no sufficient reason being assigned on the issue of variance of the amount while rejecting the application. It is required to be noted that, the amount of variance with regard to quantification having not specifically mentioned in the statement in form SVLDRS-2, nor being stated in the rejection application. Had the respondent No.1 provided the varied estimate in the statement in Form SVLDRS-2, the writ applicant would have submitted their response and sought a personal hearing. It is pertinent to note that, against the rejection of the letter dated 05.05.2020, the writ applicant had requested twice for process of the application. However, the respondent No.1 did not have assign any reason with regard to varied amount. Therefore, the whole process undertaken in this case was not fair and the mechanical rejection of the application is against the settled principles of natural justice. It is settled that, any order which has civil consequences must be passed after giving an opportunity to be heard.
The statement in Form SVLDRS-2 dated 07.02.2020 is in contravention of the provisions of the Act and the Rules thereunder and the same deserves to be quashed and set aside and accordingly, it is quashed and set aside. Consequently, the impugned rejection letters dated 05.05.2020 and 11.06.2020 are also quashed and set aside - Application allowed.
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2021 (2) TMI 236
SVLDRS - Eligibility of the petitioner or maintainability of its declaration to avail the benefits of the scheme under the category of “investigation, enquiry or audit” - quantification of the service tax dues of the petitioner for the related period was not quantified on or before 30th June, 2019 - HELD THAT:- The issue is no longer res-integra where it was held that Thought Blurb Vs. Union of India [2020 (10) TMI 1135 - BOMBAY HIGH COURT] where it was held that petitioner was eligible to file the application (declaration) as per the scheme under the category of enquiry or investigation or audit whose tax dues stood quantified on or before 30th June, 2019.
Thus, it is evident that all that would be required for being eligible under the above category is a written communication which will include a letter intimating duty demand or duty liability admitted by the person concerned during inquiry, investigation or audit.
Matter remanded back to the designated authority to consider the declaration of the petitioner in terms of the scheme as a valid declaration under the category of “investigation, enquiry and audit” and thereafter, grant the consequential relief(s) to the petitioner.
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2021 (2) TMI 160
Recovery of service tax based on the returns shown in the income tax returns - HELD THAT:- Issue notice.
In the meanwhile, there shall be stay of the impugned show cause-cum-demand notice dated 30.12.2020 - Stand over to 15.03.2021.
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2021 (2) TMI 159
Refund of lying unutilized in their CENVAT credit account - admissibility of CENVAT Credit - denial to the appellant on the ground that the service on which they are taken the cenvat credit is not input service in terms of Rule 2(l) of the CENVAT Credit Rules, 2004 - N/N. 27/2012 dt. 18.06.2012 - HELD THAT:- It is an admitted fact on record that the appellant has taken the cenvat credit on rent a cab service where the service provider has charged the service tax from them and for the remaining invoices, they have paid the service tax under reverse charge mechanism and availed the cenvat credit of the same. It is also a fact on record that at the time of availement of the cenvat credit, it was never disputed that the appellant is not entitled to the cenvat credit on the service in question. The dispute in the matter is of sanction of refund claim of unutilized cenvat credit in their account not the issue of availment of the cenvat credit on the input service, therefore, the Revenue has fell in error and wants to raise the issue of availment of the cenvat credit while entertaining the refund claim. In case, the appellant had not filed the refund claim, the appellant was entitled of the cenvat credit which was not objected at the time of availment.
At the time of entertaining the refund claim, the issue of admissibility of the CENVAT credit cannot be raised - Appeal allowed.
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2021 (2) TMI 158
Continuation of proceedings after death or adjudication as an In-solvent of a party to the appeal or application - appellant has died on 09/05/2019 during the pendency of the present appeal - Rule 22 of the Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982 - HELD THAT:- As per the death certificate produced on record, the appellant has died on 09/05/2019 when the appeal was pending. We also find that the appellant was a proprietor and has died during the pendency of the proceedings. We also find that in view of Rule 22 of the Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982, on the death of a proprietor, the proceedings shall abate.
Hon’ble Supreme Court in the case of SHABINA ABRAHAM AND OTHERS VERSUS COLLECTOR OF CENTRAL EXCISE & CUSTOMS [2015 (7) TMI 1036 - SUPREME COURT] has been held that no proceedings can be initiated against a death person as it amounts to violation of natural justice inasmuch as the death person, who is proceeded against, is not live to defend himself.
Further as per Rule 22 of the Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982, the appeal shall abate on the death of the appellant unless an application is made for continuation of such proceedings by or against the successor in interest, executor, administrator, receiver, liquidator or other legal representatives of the appellant or applicant or respondent, as the case may be - in the present case, the business of the appellant has not devolved upon any of his surviving heirs including the applicant, as per the application filed by the applicant.
The application of the applicant is allowed and the present appeal stands abated.
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2021 (2) TMI 157
CENVAT Credit - service tax received from the sub-contractors - service tax paid by the appellant on import of services under reverse charge mechanism for period prior to April 18, 2006.
CENVAT Credit - service tax received from the sub-contractors - HELD THAT:- Larger Bench of the Tribunal in COMMISSIONER OF SERVICE TAX VERSUS MELANGE DEVELOPERS PVT. LTD. [2019 (6) TMI 518 - CESTAT NEW DELHI] also observed that a sub-contractor renders a taxable service to a main contractor - thus, it has to be held that the Commissioner was not justified in denying CENVAT Credit to the appellant on the services received from the sub-contractor.
CENVAT credit - service tax paid by the appellant on import of service under a reverse charge mechanism for the period prior to April 18, 2006 - HELD THAT:- In view of the decision of the Tribunal in ADITYA BIRLA NUVO LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, LTU MUMBAI [2016 (3) TMI 619 - CESTAT MUMBAI], it has to be held that the Commissioner was not justified in denying CENVAT credit on the service tax paid by the appellant on import of services for the period prior to April 18, 2006.
Appeal allowed - decided in favor of appellant.
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2021 (2) TMI 156
Maintainability of appeal - time limitation - time spent before wrong fora to be excluded from limitation period or not? - Business Auxiliary Services - HELD THAT:- Admittedly, the appellant has filed the appeal on 19/12/2007 but the same was wrongly filed before the Commissioner of Service Tax which was located in the same building. The factum of receipt of the appeal in the office of Commissioner of Service Tax is admitted in the correspondence between the appellant and the Department. Further, it is found that after filing the appeal, the appellant vide its letter dt. 01/12/2008 and subsequent reminder dt. 12/12/2010 requested the Commissioner(Appeals) for grant of personal hearing. The appellant even filed RTI application to find out the where about of the appeal and came to know that the appeal is lying with the Commissioner of Service Tax. Further it is found that if the appeal was filed wrongly before the Commissioner of Service Tax, then it was the duty of the CST to have sent the same to the Commissioner(Appeals) who was located in the same building but the same was not done by the Department and therefore the time spent in pursuing the appeal before the wrong forum is condonable.
Matter remanded back to the learned Commissioner(Appeals) with direction to decide the appeal on merits after complying with the principles of natural justice - Appeal is allowed by way of remand.
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2021 (2) TMI 155
Levy of Service tax - amount of late payment surcharge, meter rent and supervision charges received by the appellant from the electricity consumers - period of dispute is from July, 2012 to March, 2017 - HELD THAT:- The late payment surcharge, meter rent and supervision charges are collected by the appellant in terms of Madhya Pradesh Electricity Regulatory Commission (Recovery of Expenses and Other Charges for Providing Electric Line or Plant used for purpose of giving supply) Regulations, 2009 [M.P 2009 Regulations] - The period of dispute is from July, 2012 upto March, 2017. Section 66D of the Finance Act provides for a negative list of services. This negative list comprises, amongst others, in sub-clause (k), “transmission or distribution of electricity by an electricity transmission or distribution utility”. The issue involved in this appeal is not regarding the amount collected by the appellant for supply of electricity; the dispute is regarding the amount collected towards late payment surcharge, meter rent and supervision charges.
These three charges have been collected by the appellant in terms of the 2009 Regulations. The Principal Commissioner has confirmed the demand of service tax on ‘late payment surcharge’ under section 66E(e) of the Finance Act by holding that the same is a consideration received by the appellant “for tolerating an act of electricity consumers by receiving the payments after the prescribed due date for payment of electricity bills. The Principal Commissioner has confirmed the demand of service tax on meter rent as a declared service under section 66E(f) of the Finance Act by holding that the same is the consideration received by the appellant for transfer of goods by way of hiring. The Principal Commissioner has also confirmed the demand of service tax on supervision charges collected from electricity consumers by holding that the same is taxable as it is not covered under any exemption.
Whether the exemption granted for transmission and distribution of electricity would also include directly connected activities such as meter rents? - HELD THAT:- The Government of India issued a Circular dated December 07, 2010 clarifying that supply of electricity meters to the consumers was an essential activity having direct and close nexus with transmission and distribution of electricity and was, therefore, covered by the exemption granted to transmission and distribution of electricity - thereafter, the negative list regime was introduced with effect from July 01, 2012. As noticed above, section 66D(k) includes “transmission or distribution of electricity by electricity transmission or distribution utility in the negative list”.
The issue as to whether the charges collected in connection with transmission of electricity even after July 01, 2012 would be subjected to tax as according to the Department they would not be exempted under section 66D(k) of the Finance Act, came up for consideration before the Gujarat High Court in TORRENT POWER LTD. VERSUS UNION OF INDIA [2019 (1) TMI 1092 - GUJARAT HIGH COURT] after referring to the position prior to the introduction of the negative list and the Notifications referred to above and the introduction of the negative list regime w.e.f July 01, 2012, the Gujarat High Court observed that the activities that are related/ancillary to transmission and distribution of electricity would be exempt from payment of service tax since transmission and distribution of electricity is exempted - It is also clear from aforesaid decision that all services related to transmission and distribution of electricity are bundled services, as contemplated under section 66F(3) of the Finance Act, and are required to be treated as a provision of a single service of transmission and distribution of electricity, which service is exempted from payment of service tax.
Thus, it is not possible to sustain the levy of service tax on the amount collected by the appellant for late payment surcharge, meter rent and supervision charges.
Levy of penalty on the lease rent collected from the customers - HELD THAT:- The appellant claims that since it has deposited the lease rent, the levy of penalty may be set aside. It is not possible to accept this contention of the learned counsel for the appellant. The imposition of penalty under ‘lease rent’ is, therefore, confirmed.
The confirmation of demand by the Principal Commissioner on late payment surcharge, meter rent and supervision charges are set aside. The levy of penalty on the lease rent amount is confirmed - Appeal allowed in part.
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2021 (2) TMI 116
Works Contract - commercial or industrial construction service - Audit of the records of the appellant revealed that it had utilized CENVAT credit against payment of service tax on CICS even though benefit of abatement of 67% under the notification was admissible only when the service provider did not avail credit of input, input services or capital goods - HELD THAT:- It would be necessary to refer to the agreement executed between the appellant and Gautami, for that would determine whether it was a composite contract imposing goods and service - the provisions of the agreement clearly demonstrates that the contract was composite in nature involving both supply of goods/materials and provisions of services to Gautami. Such composite contracts are taxable under the category of “works contract” w.e.f June 1, 2007. The period of dispute in the present appeal is from April 1, 2006 to October 31, 2007. Thus, the appellant was not required to pay service tax for any period prior to June 1, 2007. Even for the period post June 1, 2007, service tax could not be demanded under CICS, as the service was classifiable under “works contract”.
The confirmation of demand under the impugned order cannot be sustained - Appeal allowed - decided in favor of appellant.
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2021 (2) TMI 84
Interpretation of statute - whether determination of service tax by the Central Excise Officer, is necessary before making a demand under Section 73A(3) of the Finance Act, 1994? - HELD THAT:- From perusal of Section 73A(5) of the Act, it is evident that the amount paid to the credit of the Central Government under sub-section (1) or sub-section (2) or sub-section (4) shall be adjusted against the service tax payable by the person on finalization of assessment or any other proceedings for determination of service tax relating to the taxable service deferred to in sub-section (1). Thus, from perusal of Section 73A(5) of the Act, it is evident that the assessment must precede the demand. After taking note of the provisions of Section 73 of the Act, the learned Single Judge of this Court has held that the power to create a demand under Section 87 of the Act can be exercised only after adjudication namely on assessment of the amount - The aforesaid view has been upheld by the Division bench of this Court in the case of 'UNION OF INDIA VERSUS MRS. PRASHANTHI [2016 (7) TMI 131 - KARNATAKA HIGH COURT].
The substantial question of law framed by this Court is answered in favour of the assessee and against the revenue - Appeal dismissed.
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