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Service Tax - Case Laws
Showing 41 to 60 of 85 Records
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2023 (1) TMI 804
Adjustment of service tax paid earlier - advance tax vs excess tax - procedure prescribed in Rule 6 - denial of credit on the ground that same does not appear to be advance tax rather is excess payment of tax - Difference of opinion
HELD THAT:- The registry is directed to place the matter before Hon’ble President to consider the difference of opinion to a third Member for resolution.
There being difference of opinion between the Members, the following questions are framed for consideration by the ld. Third Member:-
Q.1. Under the fact that service tax was payable on receipt basis during the period under dispute and admittedly, the assessee paid service tax at the time of raising of the invoice. Such payment has been held to be tax paid in advance by Member (Judicial), qualifying as advance tax under Rule 6(1A) of the Service Tax Rules.
OR
As held by the Member (Technical) that such payment of tax prior to due date is not advance tax but excess payment of tax qualifying for adjustment under Rule 6(4A) & 6(4B).
Q.2. As held by the Member (Judicial) that adjustment of advance tax paid has to be allowed in the subsequent period under Rule 6(1A) and the disclosure of tax paid in ST-3 Return, amounts to compliance of the condition in Rule 6(1A) proviso.
OR
The payment in this case is excess payment of tax and thus, falls under the provisions of Rule 6(4A) and the same cannot be adjusted for failure to comply with the requirements of Rule 6(4B), as held by Member (Technical).
Q.3. Whether as held by the Member (Judicial) that the Adjudicating Authority have wrongly applied Rule 6(4A)/6(4B) of the Service Tax Rules, which is applicable in case of ‘provisional assessment’ and the applicable Rule in the facts of the case is Rule 6(1A)?
OR
As held by the Member (Technical), Rule 6(1A) (advance payment of tax), Rule 6(4) (provisional assessment of tax) and Rule 6(4A) (excess payment of tax) are different and the applicable Rule is Rule 6(4A) read with Rule 6(4B).
Q.4. The Hon’ble High Court have remanded the matter to the Tribunal to examine the entitlement of adjustment of tax, as prayed by the Revenue, and the same is not confined to the entitlement under the provisions of Rule 6(4A) and Rule 6(4B). As the provisions of Finance Act, 1994 read with Article 265 of the Constitution of India, does not provide for collection and retention of tax not authorized by law. The Advance/excess tax, admittedly paid should be adjusted for determining the net tax liability, as held by the Member (Judicial).
OR
In terms of the question framed and answered by the Hon’ble High Court, the Tribunal has been directed to examine the eligibility of the adjustment only in terms of Rule 6(4A) and Rule 6(4B), as held by the Member (Technical).
Q.5. The application of Rule 6(4A) and Rule 6(4B) are subject to option made by the assessee for payment of tax on provisional basis under Rule 6(4), and are not applicable to service tax paid in advance in terms of Rule 6(1A), as held by the Member (Judicial).
OR
Rule 6 (1A), Rule 6(4) and Rule 6(4A) read with Rule 6(4B) deal with different situations and in the present case the provision of Rule 6(1A) is not applicable but Rule 6(4A) & 6(4B) are applicable as held by the Member (Technical).
The Registry is directed to place the appeal records before the Hon’ble President for appointment of the ld. Third Member for determining the questions framed herein regarding the difference of opinion.
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2023 (1) TMI 803
Levy of service tax - Renting of Immovable Property Service - audit team found that the appellant had let out its premises in Gurgaon for commercial purposes to M/s. Usha Fabs Private Ltd. and was not collecting any rent for it - renting of residential flat in Mussorie for residential purpose - HELD THAT:- The entire case of the department is built by wrongly understanding the amounts advanced by the appellant to M/s. Usha Fabs Pvt. Ltd. as amounts received as advances by the appellant. A bare perusal of the documents presented before us including the ledgers brings out the correct facts. Audit team appears to have been confused between what is a credit and what is a debit and came to a conclusion that the amounts advanced by the appellant were amounts received by it.
The correct facts were presented by the appellant in reply to the SCN and also during the personal hearing as recorded in the impugned order. However, while giving her findings, the Commissioner has recorded just the opposite as facts.
The entire case is built on a mistaken reading of the ledgers by the audit team and continued in the SCN. Even after the correct facts were presented, the demand was confirmed in the impugned order without giving any reasons. Once it is found as a fact that the appellant had given advances and not received them from M/s. Usha Fabs Pvt. Ltd., nothing survives in the impugned order.
Appeal allowed - decided in favor of appellant.
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2023 (1) TMI 743
Validity of adjudication of SCN after much delay - inordinate delay - grant of centralized service tax registration - Divisional Officer was obliged to send intimation to the respective jurisdictional Service Tax office-in-charge of the erstwhile branch to transfer the relevant records to its office for taking further action and to update the records, but despite the same, the files pertaining to the said show cause cum demand notice were not transferred to the Respondent No.2 - notice of hearing was issued around eleven years after the date of the said show cause cum demand notice - HELD THAT:- The Respondents have not acted in the manner as required by law. True that, while the Respondents’ right in law to initiate proceedings for violation of the provisions of the Act can never by disputed, at the same time, they do not have the unfettered right to choose a time to conclude the said proceedings as per their own whims and fancies. Action on the part of a constituent of State has to be with responsibility and not caprice - The words “reasonable period” call for a flexible rather than a rigid construction having regard to the facts of each case, but the period in excess of eleven years as claimed by the Petitioner or even seven years, if we were to consider the period from 8 May 2013, when the Petitioner informed the Respondent Authority that it had obtained Centralized Registration, without the Respondents sufficiently explaining as to what prevented them from concluding the proceedings except their own delay, in our view is nothing but unreasonable and the reasons stated in the affidavit-in-reply cannot be accepted.
Respondents having delayed the transfer of proceedings from Delhi to Mumbai and not even having bothered to themselves do the same upon the Centralized Registration by the Petitioner on 9 September 2010 and even after the Petitioner informed of the same on 8 May 2013, without any satisfactory explanation for this delay, adjudication of the Show Cause cum Demand Notice No.59 of 2009 dated 12 October 2009, which ought to have been culminated within a reasonable time has not been done and adjudicating the same now after an inordinate and unreasonable lapse of time would be detrimental and cause severe prejudice to the Petitioner.
The impugned show cause cum demand notice dated 12 October 2009 cannot be carried forward after such an inordinate delay - Petition allowed.
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2023 (1) TMI 742
Refusal of refund claim - It is further urged that the refund was rejected by the Department on the flimsy grounds, inspite of having accepted the consolidated return - HELD THAT:- The appellant have admittedly filed consolidated return for the period April to September, 2010, and were advised not to consider this amount of Rs.39,09,130/- (by challan) towards adjustment of taxes. Further as advised they have applied for refund of this amount as wrongly deposited. Further, the return filed during adjudication proceedings for the Escrow account, where appellant has shown nil taxable receipt and nil tax liability, and the said amount was deposited through challan as excess payment, has not been rejected by the Department.
The appellant is entitled to refund of Rs.39,09,130/-. The Adjudicating Authority is directed to grant refund with interest as per rules, within a period of 45 days from the date of receipt of copy of this order - Appeal allowed.
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2023 (1) TMI 741
Rejection of refund claim - hit by limitation of one year as prescribed under section 11 B of Central Excise Act, 1944 - HELD THAT:- The amount of Rs.19,34,552/- the refund whereof was claimed the entire amount irrespective it was above 7.5 % / 10% of Section 35 F of Central Excise Act but was not at all an amount of duty rather it was still an amount with the Department as a deposit made by the appellant. The Department has no authority to retain the said amount. Such retention is otherwise specifically barred in terms of article 265 of Constitution of India.
Commissioner (Appeal) has wrongly invoked section 11 B of Central Excise Act for applying the time limitation prescribed under the said section while rejecting the impugned refund claim - Hon’ble Apex Court in SANDVIK ASIA LIMITED VERSUS COMMISSIONER OF INCOME-TAX AND OTHERSa [2006 (1) TMI 55 - SUPREME COURT] had clarified that no time limit can be made applicable for the refunds with respect to the amount of deposits/ pre-deposits.
Appeal allowed.
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2023 (1) TMI 740
Validity of SCN - Classification of services - erection, commissioning or installation service or works contract service or commercial or industrial construction service - HELD THAT:- In M/S. SHUBHAM ELECTRICALS VERSUS CST & ST, ROHTAK [2015 (6) TMI 786 - CESTAT NEW DELHI], a Division Bench of the Tribunal examined a similar controversy since the show cause notice also alleged that the services provided could either be classified under ‘management, maintenance or repair service’ or ‘erection, commissioning or installation service’ and set aside the impugned order for the reason that the show cause notice was vague and incoherent.
The show cause notice issued by the Department in the present appeal is also vague and incoherent as it alleges that the appellant could have provided any of the three alternative services.
Impugned order set aside - appeal allowed.
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2023 (1) TMI 739
Wrongful availment of CENVAT Credit - credit availed prior taking the registration - also credit availed on improper document i.e. on such invoices which were not in the name of registered address - violation of Rule 9 of Cenvat Credit Rules, 2004 and Rule 4(8) of Service Tax Rules, 1994 - extended period of limitation - penalty - HELD THAT:- There is no denial to the fact that the appellant started providing taxable service prior getting its registration. The service in question were admittedly taxable service which were provided against the invoices. However, few invoices were issued at the address at which the appellant was /is existing. There is no denial of the department that Plot No. SP 2/93 Neemrana, Alwar, Jaipur from where most of the invoices had been issued subsequently became the registered premises of service provider vide registration dated 18.4.2017 Few invoices have been issued at the address which till that date has not been registered, i.e. at 1052, Sector 40, Gurgaon, Haryana but the appellants had taken these premises on license basis for some time and an agreement was duly executed for the purpose - the premises to be mentioned in invoice should be such from where the services have been provided instead of these being the registered premises.
Though no Cenvat is allowed if document lacks necessary particulars. But the proviso to Rule 9(2) says that even if there is no precise document but otherwise the requisite details given in the said proviso as noted above are available on record, the Cenvat Credit may be allowed.
In the present case, it is rather apparent fact that service provider /appellant had during the period of providing service in question applied for registration and finally got itself registered with the service tax Commissionerate. This fact is sufficient to hold that the invoices of pre-registration phase shall also be considered for availment of Cenvat credit by the appellant - Commissioner (Appeals) has wrongly stuck to Rule 9(2) of Cenvat Credit Rules, 2004, the proviso thereof has wrongly been ignored by Commissioner (Appeals). Resultantly, the invoices issued from unregistered address and the invoice of pre-registration time have wrongly been held to be invalid documents while ordering denial of Cenvat credit to the appellant.
Ineligible import service - HELD THAT:- The Commissioner (Appeals) has held that Cenvat credit of service tax paid by the appellant has otherwise been claimed on the ineligible import service. These findings are beyond the scope of impugned show cause notice. There is no allegation raised in the show cause notice about the services to be not eligible import service. The order under challenge is accordingly held to be beyond the scope of show cause notice.
Hon’ble Supreme Court in the case of COMMISSIONER OF C. EX., BANGALORE VERSUS BRINDAVAN BEVERAGES (P) LTD. [2007 (6) TMI 4 - SUPREME COURT] has held that the show cause notice is foundation on which the department must build up its case. Hence the show cause notice should contain all the relevant details and departmental authorities have to be stick to the allegation in the show cause notice.
Extended period of limitation - levy of penalty - HELD THAT:- The show cause notice in this case is dated 12.12.2019. The Cenvat Credit availment has been denied for the period June, 2016 to June, 2017. Thus, it is clear that show cause notice is issued while invoking the extended period of limitation. From the above observed admitted facts, there does not appear any intention on the part of the appellant to evade service tax. Rather apparently and admittedly, the service tax stand already paid by the appellant. It is not the case of the department that service tax paid is a short payment. The extended period could have been invoked pursuant to proviso to section 73 of CGST Act and thus only in a situation where there has been apparent mis- representation, suppression of facts or collusion on part of the appellant that too with intention to evade the tax liability. Since the same is not the fact of the present case, the extended period has wrongly been invoked - Even the penalty on the appellant has wrongly been levied.
Appeal allowed.
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2023 (1) TMI 738
Interest on account of delayed refund - Denial on the ground that there was no delay in sanctioning of refund amount as per Section 11BB of the Central Excise Act, 1944 - HELD THAT:- It is an amount paid by the appellant as service tax during the course of investigation. This fact is not in dispute. When any amount paid during the investigation, it is only a predeposit made by the appellant. On succeeding in the appeal, the predeposit made in connection to the said appeal is liable to be refunded with interest. The order of Tribunal has attained finality. In that circumstance, the appellant is entitled to claim interest from the date of deposit till its realization.
The issue is no longer res integra as the Division Bench of this Tribunal in M/S. PARLE AGRO PVT. LTD. VERSUS COMMISSIONER, CENTRAL GOODS & SERVICE TAX, NOIDA (VICE-VERSA) [2021 (5) TMI 870 - CESTAT ALLAHABAD], following the ruling of the Apex Court in SANDVIK ASIA LIMITED VERSUS COMMISSIONER OF INCOME-TAX AND OTHERS [2006 (1) TMI 55 - SUPREME COURT] have held that such amount deposited during investigation and/or pending litigation is ipso facto pre-deposit and interest is payable on such amount to the assessee being successful in appeal, from the date of deposit till the date of refund.
The impugned order is not sustainable in the eyes of law - appeal allowed.
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2023 (1) TMI 690
Short payment of service tax - erection, installation and commissioning work service - Wrong classification of service under Works Contract Service - benefit of N/N. 1/2006 –ST - circular No. B1/16/2007-TRU dated 22.05.2007 - HELD THAT:- The aforesaid exemption entry is applicable on taxable category viz. Erection, commissioning or installation, under a contract for supplying a plant, machinery or equipment or structures and erection, commissioning or installation of such plant, machinery or equipment or structures. The Learned Commissioner denied the benefit of said entry to the Appellant on the ground that Appellant is not supplying plant, machinery, equipment or structures, but carrying out thermal insulation and hence benefit of 67% abatement from gross value would not be available to appellant as the condition laid down in the said Notification are not fulfilled by appellant - it cannot be considered that the said entry is applicable only on the supply of plant, machinery or equipment or structures. Besides, it is also applicable on any other material so Learned In the present matter there is no dispute on the facts that the Appellant is Commissioning and Installation agency and for providing the taxable services appellant has provided the thermal insulating materials i.e. Hot insulation including supply of LRB and Aluminium Sheet, Cold insulation with Thermocol and Aluminium Sheet, Insulation of Pipeline with black superion sleeve providing and fixing of black superion with cellotape , insulation with black nitrile rubber foam, sheet, etc. and on supply of goods appellant also paid sales tax/ VAT. Hence, the Appellant are eligible to the benefit of the Notification No. 1/2006-S.T., dated 1-3-2006.
Wrong classification of service under Works Contract Service - HELD THAT:- From the definition of Works Contract Service, it is clear that only specified categories of works contract are considered for levy of Service Tax under the said definition. These are enumerated in clauses (a) to (e). It is found that in clause (a) thermal insulation also mentioned and in the present matter appellant had also paid VAT/ sales tax on goods which is used in installation of thermal insulation. The impugned activity of the assessee was nothing but “works contract service”.
There are no merit in the impugned order demanding service tax from appellant - appeal allowed.
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2023 (1) TMI 689
Non/Short payment of service tax - renting of immovable property (office) in respect of rent charges paid to its Director - availment of wrong or higher abatement - penalty for late filing of ST-3 Returns - interest on delayed payment of service tax - penalty - revenue neutrality - Extended Period of Limitation.
Demand of Rs. 2,90,628/- have been confirmed on payment of rent for office to Director of the Company during the period April 2014 to June 2017 - Reverse Charge Mechanism - Extended Period of Limitation - revenue neutrality - HELD THAT:- Admittedly, under the facts, the appellant on payment of service tax on the rent was entitled to Cenvat Credit of the same. Thus, the situation is wholly revenue neutral - this ground is allowed and the demand is set aside.
Allegation of short payment of service tax of Rs. 24,44,446/-, due to availment of wrong and higher abatement - HELD THAT:- The appellant have done execution of new work after removing the existing structure and railing etc. This ground is allowed in favour of the appellant and set aside the demand of Rs. 24,44,446/-.
Imposition of penalty under Section 77 for late filing of return and u/s 78 of FA - HELD THAT:- The show cause notice have been issued by invocation of extended period of limitation. Further, prior to issue of show cause notice dated 13.07.2020 appellant have admittedly filed the service tax returns, about two years prior to it in the year 2018. In this view of the matter, the quantum of penalty is reduced to Rs. 2000 per return or a total penalty of Rs. 6000/- under Section 77 r/w Rule 7C of Service Tax Rules - penalty under Section 78 also stands set aside
Demand of interest under Section 75 - It is contended that three challans deposited by the appellant for Rs. 2,241/-+ Rs. 44,008/- Rs. 5,539/- totalling Rs. 51,788/- have not been considered before computing the short payment of interest - HELD THAT:- interest under Section 75 is payable for delayed payment of service tax, as such tax has not been paid by the due date or within the prescribed period. Thus, this ground is allowed by way of remand directing the Adjudicating Authority to recalculate the interest for delayed payment of tax after giving credit, on verification of the challans produced.
Appeal allowed in part and part matter on remand.
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2023 (1) TMI 641
Validity of refund sanctioned on the basis of debit notes - valid Service Tax payment document or not - whether the debit notes satisfy the condition of Rule 4A of the Rules or not - applicability of N/N. 41/2012-ST dated 29.03.2012 read with Rule 4A(1) of the Service Tax Rules, 1994 - HELD THAT:- Notification No.41/2012-ST dated 29.03.2012 stipulates the manner in which the rebate shall be claimed. On going through the Notification it is clear that nomenclature of the documents is not necessary but the said document should fulfill all the necessary details as required. In the present case, the debit notes duly fulfilled all the necessary conditions as are required to be provided, but the fact remains that the said documents are not invoices, bills or challans, but are debit notes.
The issue is no more res integra and the Tribunal in the case of M/S SRF LTD. VERSUS C.C.E., JAIPUR-I [2015 (9) TMI 1281 - CESTAT NEW DELHI] where it was held that The purpose sought to be served by specifying the details that are to be contained in the document issued while rendering service is to provide information regarding the registration number and details of service provider details, details of service recipient, description and value of taxable service, and the service tax payable thereon. If the documents provide these necessary particulars, merely because the documents are debit notes the refund cannot be denied at the end of the service recipient.
The facts of the present case are squarely covered by the above-mentioned decision of the Tribunal and therefore the impugned order cannot be sustained - appeal allowed.
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2023 (1) TMI 594
Condonation of delay in filing appeal - Proper service of order - appeal has been dismissed on grounds of limitation as being beyond the statutory limit of 60 days prescribed under Section 85 of the Finance Act, 1994 and also beyond the condonable period of 30 days under Section 85(3A) of the Finance Act, 1994 - HELD THAT:- Under Section 85 of the Finance Act, 1994 the statutory limit of 60 days is prescribed for preferring an appeal. The delay if any is condonable up to 30 days beyond the period of 60 days under Section 85(3A) of the Act.
Two facts emerge from the pleadings on records which cannot be ignored: first that the certified copy of the impugned order was provided to the appellant on 19th December 2020 by the Adjudication Branch of Central Goods & Services Tax and Central Excise, Ranchi which means that by that time the relaxation of limitation period as per the directions of the Apex Court in IN RE : COGNIZANCE FOR EXTENSION OF LIMITATION [2020 (5) TMI 418 - SC ORDER] had commenced due to the COVID lockdown. The other fact which emerges from the information obtained under RTI vide Annexure 11 from the office of the Principal Commissioner, Central Goods & Services Tax and Central Excise, Ranchi dated 24th January 2022 is that the booking journal or the track consignment report of the speed post does not contain the complete address of the petitioner.
The presumption of proof of service of notice is a rebuttable piece of evidence and the track consignment report having an incomplete address of the petitioner valid service of notice of the order in original cannot be presumed. Section 27 of the General Clauses Act as quoted at paragraph 6 of the impugned appellate order also provides that service shall be deemed to be effected by properly addressing, prepaying and posting it be registered post. Petitioner s have therefore rightly contended that it could not have approached the appellate authority earlier.
The grounds of rejection of the memo of appeal are not tenable on facts - matter is remanded to the appellate authority to consider afresh in accordance with law - Petition allowed.
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2023 (1) TMI 593
Levy of service tax - GTA Service - Business Auxiliary Service (Commission received) - denial of Cenvat credit on account of documents defects of not mentioning the service tax registration number.
CENVAT Credit - input services - GTA Services - From the order it is noticed that the adjudicating authority has rejected the CA Certificate for the reason that the supporting document has not been given by the appellant. The purpose of getting the service from the CA is that a summary of the findings can be obtained. In case the adjudicating authority had any doubt regarding the CA certificate he could have asked for the supporting document or any other explanation - it is found that no such documents have been sought by the adjudicating authority. In these circumstances summary rejection of chartered accountant certificate is not right.
Learned counsel argued that the situation is revenue neutral as the appellant would have been entitled to cenvat credit on the tax paid on the GTA services. It is not entirely correct argument as part of the GTA services could have been availed for the purpose of clearance of finished goods and the admissibility of cenvat credit on such service tax depends on many factors. In this circumstance the argument of revenue neutrality does not survive - the order confirming demand on service tax on GTA services is set aside and the matter is remanded back to the Original Adjudicating Authority to decide a fresh. The doubt raised on the CA certificate may be highlighted and if the necessary supporting need document can be called.
Demand of service tax has been made under the category of Business Auxiliary service on the commission received by the appellant - HELD THAT:- The demand has been made without examining the nature of commission received. The show cause notice does not mention the nature of the commission received by the appellant. The SCN merely picks up the head of commission in the balance sheet and compares it with the ST- 3 return. The Order-In –Original also makes the vague reference to commission received in respect of repairs and attending to customers complaints. It is not understood how the services would become taxable under the business auxiliary service. The appellant has also not produced any documents to show the exact nature of the services provided by them - matter remanded back to the Original Adjudicating Authority to decide a fresh after examining the actual contract under which such payment has been received and specifically examine the nature of services provided an its taxability. The appeal is allowed by way of remand.
Denial of cenvat credit on account of certain defects in the documents on the strength of which the credit was taken - HELD THAT:- The revenue has placed on record letter dated 21.01.2013 of Commissioner of Service Tax Ahmedabad - It is noticed that this report has been obtained after adjudication of the case by the adjudicating authority and the same was not available at the time of adjudication. Since this report was not available with the adjudicating authority the decision could not have been taken after examining complete facts. Consequently the demand on this issue is also set aside and the matter is remanded back to the original Adjudicating Authority.
The appeals are allowed by way of remand.
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2023 (1) TMI 592
Classification of services - scientific and technical consultancy services or not - appellant is a semi-autonomous organisation created to promote the productivity in industry, agriculture and other sectors of economy - Includability of expenses claimed by the appellant as reimbursable expenses in the gross value - time limitation - penalty - HELD THAT:- The scientific and technical consultancy means an advice, consultancy or scientific or technical assistance rendered in any manner either directly or indirectly by scientists or a technocrat or in his or technical institutions or organisation. The training programmes conducted by the appellant squarely fall in this category and there are no reason to deviate from the previous decision of this Tribunal in the appellant’s own case M/S NATIONAL PRODUCTIVITY COUNCIL VERSUS CCE, CHANDIGARH [2008 (8) TMI 26 - CESTAT, NEW DELHI] where it was held that thrust of the Appellant’s activity is conducting scientific research related to productivity and undertaking technical study in this regard for their clients and tendering advice to them for optimizing their productivity, hence appellant is more appropriately covered under “Scientific or Technical Consultancy Service” than “Management Consultancy”.
Includability of expenses claimed by the appellant as reimbursable expenses in the gross value - HELD THAT:- In the impugned order, the Commissioner (Appeals) has already held that the board and lodging facilities provided for training would not form part of the gross value whereas expenses in other heads such as printing, stationery and miscellaneous expenses will be part of the gross amount. There are no good reason to deviate from this decision.
Time Limitation - HELD THAT:- The Commissioner (Appeals) held that the demand from the period July, 2001 to March 2004 was time barred as the extended period of limitation could not be invoked. The Commissioner (Appeals) has also accepted the appellant’s contention that amounts received by it for service should be treated as cum-tax receipts and the service tax should be calculated backwards. There is no appeal against this part of the order.
Penalty - HELD THAT:- The penalty under section 78 which requires fraud or collision or wilful mis-statement or suppression of facts or violation of any provisions or Act or Rules with intent to evade the payment of service tax was also set aside by the Commissioner (Appeals) - The penalty under section 76 is a simple penalty for failure to pay service tax where none of the aforesaid elements are present. This penalty has been upheld by the Commissioner (Appeals). The Commissioner (Appeals) has also upheld the mandatory interest under section 75.
Appeal dismissed.
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2023 (1) TMI 547
Monetary amount involved in the appeal - Para-2 of the Circular dated 17th August, 2011 - Whether the expression Monetary limit would essentially refer to the excise duty involved and would not include the penalty or interest amount? - appropriate forum - HELD THAT:- Para-2 of the Circular dated 17th August, 2011 clarifies that the expression “Monetary limit” would essentially refer to the excise duty involved and would not include the penalty or interest amount. Since the basic duty involved is below Rs.1Crore, the appeal is certainly below the monetary limit.
Further, whether the service carried out by the Appellant is Cargo Handling Services or mining service is essentially a classification dispute. Consequently, following the Judgment of the Karnataka High Court in COMMISSIONER OF SERVICE TAX VERSUS SCOTT WILSON KIRKPATRICK (INDIA) (P.) LTD. [2011 (4) TMI 500 - KARNATAKA HIGH COURT], the Court holds that the appeal against the order of the CESTAT would lie if at all only to the Supreme Court of India.
The Court declines to interfere in the present appeal, leaving it open to the Department if it so chooses to avail any other remedy available to it in accordance with law. The appeal is disposed of.
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2023 (1) TMI 546
Benefit of SVLDRS - Revenue filed the appeal after the expiry of limitation of Scheme - Rejection of declaration filed by the petitioner under Section 125 (2) of SABKA VISHWAS (LEGACY DISPUTE RESOLUTION) SCHEME, 2019 , in Form SVLDRS-1 - jurisdiction of Designated Committee in terms of Section 126 of SABKA VISHWAS (LEGACY DISPUTE RESOLUTION) SCHEME, 2019 - extension of benefit by issuance of Discharge Certificate to the petitioner after accepting the amount which the petitioner is liable to deposit under the Scheme of 2019.
HELD THAT:- It appears that from bare perusal of Section 126 as well as Section 127 of the SVLDRS Scheme and its corresponding Rules being Rule 6 of SVLDRS Rule, it would transpires that the Designated Committee constituted under the Scheme was only required to verify the correctness of the declaration filed by the declarant and estimate the amount payable by such declarant for availing the benefit of the said Scheme, Thus, Designated Committee has not been vested with any jurisdiction to deny the benefit of the Scheme to a declarant on the sole ground that department has taken for filing an Appeal against the Order in Original. The impugned order passed by respondent no.2 is wholly without jurisdiction and beyond its power conferred under the Scheme of 2019. The Designated Committee travelled beyond the purview of the Scheme and acted in a wholly illegally and arbitrary manner by denying the benefit of the Scheme to the petitioner.
The crux of the case revolves around the category i.e. arrears or litigation under which the case of the Petitioner will fall. From bare perusal of the aforesaid provisions of Scheme, it would transpire that the nature of cases falling under Section 121(c) is categorized under "arrears category". Section 123(a), 123(b) and 123(c) deals with cases falling under "litigation category" for determining tax dues under the Scheme. The said provisions of Section 123 are not applicable to the case of the Petitioner, as admittedly, no Appeal was pending as on 30. 06.2019 and the show cause notice was received by the Petitioner on 10.08.2019 i.e. after the cut off date of 30.06.2019 - Further, no enquiry or investigation or audit was pending against the Petitioner as on 30.06.2019. Thus, calculation of Tax payable under Section 124(1)(a) by the Designated Committee is unwarranted.
As on the date of filing of the declaration form by the Petitioner, no Appeal was filed and/or pending before the Appellate Forum. Indeed for the purpose of determination of tax dues, the case of the petitioner does not fall under Section 123 of the scheme of 2019 as Department had not preferred an Appeal against the Order in Original as on the said date - It further appears that the appeal of the Department has been filed after the expiry of period of limitation prescribed under Section 86(3) of the Finance Act as the said provision provides a period of limitation of three months which has expired on 14.04.2020. Thus, it transpires that in the opinion of the respondent filing of the appeal has led to change in the category of petitioner from “arrear category” to “litigation category” which view is beyond the letter and spirit of the scheme.
The impugned Order wherein the Declaration filed by the petitioner under Section 125 (2) of SABKA VISHWAS (LEGACY DISPUTE RESOLUTION) SCHEME, 2019, in Form SVLDRS 1 has been rejected, is quashed - Application allowed.
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2023 (1) TMI 545
Invocation of extended period of limitation - sum and substance of the objection raised by the appellants is that for the financial years 2011-2012 to 2014- 2015, show cause notice was issued, which culminated in an order of adjudication and the matter is now pending before the Tribunal at the instance of the appellants and in such circumstances, for the very same allegation for the subsequent period, i.e 2015-2016 to 2017-2018 extended period of limitation could not have been invoked.
HELD THAT:- Once a preliminary objection is raised on the question of jurisdiction, it is but appropriate for the adjudicating authority to deal with the said issue as first amongst the several issues while passing the order of adjudication. However, the adjudicating authority has adopted a reverse process by deciding the merit first and then dealt with the question of limitation / jurisdiction.
This legal issue can be decided only after the affidavit in- opposition is filed by respondents in the writ petition. In the interregnum, if the order of adjudication dated 27th July, 2022 is given effect to, then the appellants would be put to prejudice. Therefore, the order of adjudication dated 27th July, 2022 shall remain stayed till the disposal of the writ petition.
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2023 (1) TMI 544
Levy of Service tax - Business Auxiliary Service or not - sharing of revenue - giving property for temporary rent to generate income to boost its charitable activities - principles of Revenue Neutrality - extended period of limitation - HELD THAT:- The Service Tax was demanded on the sharing of receipt from the total receipt of the contractor. The contractor provided the service of Mandap keeper to his client in the premises of the appellant. Therefore, out of the Mandap keeper service as per their understanding sharing of the appellant was given. As regard the issue that whether the Service Tax is payable on mere sharing of consideration towards service will not prima facie amount to provision of any service on the part of the appellant - the appellant had a bona fide belief in non payment of Service Tax. The appellant also submitted that this case is falling under the principle of revenue neutrality in as much as the tax payment if any made by the appellant is available as the Cenvat credit to the contractor who has used the premises of the appellant.
Extended period of limitation - HELD THAT:- The suppression of fact and mala fide cannot be attributed against the appellant. Accordingly, the demand is hit by limitation as extended period could not have been invoked in the fact of the present case.
The demand is set aside on the ground of limitation itself - appeal allowed.
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2023 (1) TMI 543
Refund of Service Tax paid for export of goods under Notification No. 17/2009-ST - Foreign Agent Commission - Banking and Financial Services - failure of appellant to produce the original invoices - refund of service tax is paid on Banking and Financial Services have been denied on the ground that the appellant have failed to correlate the said services availed by them with the export of goods - HELD THAT:- The admissibility of refund on Foreign Agent Commission has been examined by Tribunal in the case of M/S VST INDUSTRIES LTD. VERSUS CCE, C & ST, HYDERABAD [2017 (10) TMI 24 - CESTAT HYDERABAD] wherein it was held that The procedures prescribed in the notification are to facilitate verification of the claims. Since there is no dispute with regard to the export made or the service tax paid, the non-fulfilment of the conditions is condonable, the non-fulfilment of the conditions is only a procedural lapse and can be condoned - thus, refund of Service Tax on Foreign Agent Commission cannot be denied.
Rejection of refund in respect of CHA services - appellant failed to provide the original copy of invoices - HELD THAT:- The Commissioner has observed that due to statutory requirement of rule 4A of the Service Tax Rules, 1994, the Invoice/ bill/ challans, on which the refund is sought, has to be mandatorily signed by the person providing taxable service or by a person authorized by him in respect of such taxable service. Therefore, it can be clearly inferred that the invoices are to be submitted in original - Learned Counsel argued that they had produced this circular before the lower authority but no findings have given. It is seen that the observations of Commissioner (Appeals) are in contradiction with the directions of CBIC. The order of Commissioner (Appeals) on this count is set aside and matter remanded to the original adjudicating authority with directions to follow the Circular of CBIC in this regard.
Denial of refund of Service Tax paid on Banking and Financial Services - appellant has failed to correlate the services availed with the exports of goods - HELD THAT:- All the business of the appellant was export of goods, therefore, no co-relation was necessary as all the services were availed for export of goods. It is seen that the Commissioner (Appeals) has not taking note of this observation. If the said assertion is correct then no co-relation may be required for claiming the refund. However, since this fact has not been examined by the lower authority. The order of this account is set aside, the matter remanded to the Adjudicating authority.
Appeal allowed in part and part matter on remand.
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2023 (1) TMI 542
CENVAT Credit - input services or not - input services availed by its Zonal Training Centre (ZTC), Zonal Office (ZO) and Zonal Audit Office (ZAO) in terms of Rule 2(l) of Cenvat Credit Rules, 2004 - Reverse charge mechanism - whether the services received by Zonal Training Centre, Zonal Office and Zonal Audit Office falls under the definition of ‘input service’ as provided by Rule 2(l) ibid? - HELD THAT:- Admittedly the centralized registration has been obtained by the appellant in terms of Rule 4(2) of Service Tax Rules, 1994. The said rule provides that if a person is providing any taxable service and using one or more separate premises, which are assisting directly or indirectly in providing such taxable services and has centralized billing/accounting system, then the service tax registration for such separate premises can be obtained under the centralized service tax registration. This is irrespective of the fact that such other separate premises are providing any taxable service on their own or not. It is the case of the appellant that these Zonal Training Centre (ZTC), Zonal Audit Office (ZAO) and Zonal Office (ZO) are assisting the appellant in the provision of its taxable services and have centralized accounting/ billing system.
Since generally training centre and audit office are considered as integral part of any establishment therefore, there are force in the submissions of learned Counsel that these offices are integral part of the appellant and play an important role, directly or indirectly, in providing output service by the appellant smoothly. These offices are inevitable for the working of the appellant. Although they are not providing any taxable services on their own but are assisting the appellant in providing its output services efficiently.
The appellant has successfully established that these three zonal offices are integral part and parcel of the appellant only and the fact that they are located separately hardly makes any difference. Therefore, the appellant is justified in availing Cenvat Credit in respect of input services availed by its Zonal Training Centre, Zonal Office and Zonal Audit Office (ZAO) in terms of Rule 2(l) of Cenvat Credit Rules, 2004 and the services received by these zonal offices fall under the definition of ‘input service’ as provided by Rule 2(l) ibid. Therefore, the demand raised in the show cause notice is not sustainable and once the demand has been set aside, there is no question of any interest or penalty.
Appeal allowed.
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