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Service Tax - Case Laws
Showing 81 to 100 of 124 Records
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2023 (3) TMI 445
Short payment of service tax - Construction of Residential Complex Service - non filing of periodical ST-3 returns - allegations against the assessee are that they were engaged in the construction of residential complexes, which became taxable on 16.06.2005, but they have taken registration with the Department only during June 2008 - HELD THAT:- The demand period in the impugned order covers the period from May 2006 to June 2010, ie under the category of ‘Construction of Residential Complex Service’ for the periods from May 2006 to September 2009 in respect of project namely, SIS Danube and under the category of ‘Works Contract’ for the period from March 2008 to September 2009 in respect of project namely, SIS Safaa and another Notice dated 06.04.2011 proposing to levy Service Tax under the category of Works Contract for SIS Safaa for the period from October 2009 to June 2010.
Works Contract Service came under Service Tax levy with the introduction of section 65(105)(zzzza) in the Finance Act 1994 from 01/06/2007. The period covered under the demand for works contract as per the impugned order is post 01/06/2007 and hence the service rendered by the appellant is prima facie eligible for the levy of service tax - the co-ordinate Delhi Bench of the Tribunal in the case of M/S KRISHNA HOMES VERSUS CCE, BHOPAL AND CCE, BHOPAL VERSUS M/S RAJ HOMES [2014 (3) TMI 694 - CESTAT AHMEDABAD] has examined the liability of a builder/developer/promoter to pay service tax on the construction of residential complex for its customers. The Tribunal has taken notice of C.B.E.C. Circular No. 332/35/2006-TRU dated 01/08/2006 wherein it was clarified that where a builder/developer/promoter builds a residential complex engaging a contractor, the contractor shall be liable to pay service tax on the gross amount charged under construction of complex service and if no person is engaged by the builder/developer/promoter and who undertakes construction work on his own, the question of providing taxable service to any person by any other person does not arise and it would be in the nature of self service.
Since the period where duty has been demanded in the impugned order is prior to 01/07/2010, no liability for paying tax either under ‘construction of complex service’ or ‘works contract’ would lie on the builder/developer/promoter during the period covered by the impugned order.
Appeal allowed.
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2023 (3) TMI 444
Classification of services - Cargo Handling Service - Clearing and Forwarding Agency Service - Stevedoring Service - Customs House Agency Service - value of the services calculated separately under the appropriate categories for levy of duty - services rendered on a turnkey basis under the CHA category - Show Cause Notice issued was time-barred under the normal time period - allegation of suppression of fact etc. for issue the Show Cause Notice under the extended time limit - liability to pay interest and penalties.
HELD THAT:- The clarification in C.B.E.C. vide circular F. No. B43/1/97-TRU dated 06/06/1997 with reference to the CHA service covers a gamut of service activity which could when rendered individually be covered under other specific service categories. However, when the whole range of activity is performed by a CHA in relation to the entry or departure of conveyance or the import or export of goods, it will be covered under CHA Service and Service Tax is to be computed only on the gross service charges, by whatever head / nomenclature billed by the CHA to his client. This clarification is squarely applicable in the case of the CHA services provided by ASPIN to their clients, in relation to the entry or departure of conveyances or the import or export of goods.
The services rendered by ASPIN on turnkey basis during the period under appeal would fall under the category of CHA Services and the value of taxable service has to be computed in the manner stated at paragraph 2.5 of the C.B.E.C. Circular dated 06.06.1997 above.
Having decided the matter of classification and valuation on merits in favour of the appellant, the issues relating to interest and fines do not survive - Appeal allowed.
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2023 (3) TMI 443
Classification of services - Business Auxiliary service or not - business of promoting and marketing post-paid mobile connections and providing services of finding prospective customers, billing, collection of cash/cheques of mobile bills, evaluation of prospective customers and other customer care services for M/s. Aircel Ltd. in their capacity as an authorized agent, for which they received commission from M/s. Aircel Ltd. - waiver of penalty u/s 80 of FA.
HELD THAT:- In the case of CHOTEY LAL RADHEY SHYAM VERSUS COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX, LUCKNOW [2015 (11) TMI 979 - CESTAT ALLAHABAD], the Tribunal had set aside the demand observing that the assessee therein, who is an agent of M/s. BSNL, being engaged only in the purchase and sale of SIM cards and recharge coupons, the demand could not sustain, as M/s. BSNL had already paid the Service Tax on the SIM cards and recharge coupons. The said decision, however, would not be applicable to the case of the appellant on merits since the appellant herein is not only engaged in the purchase and sale of SIM cards, but also doing the activity of procurement of clients, promotion of sales, evaluation of prospective customers and other customer care services.
The facts, however, reveal, that the appellant was under the bona fide belief that they were not liable to pay the Service Tax as the commission paid to them was part of the charges received by the telecommunication service provider for providing the post-paid connections. Taking note of this, it is opined that the appellant has furnished reasonable cause for failure on their part to pay the Service Tax. It is also noted that they have paid up a major part of the Service Tax.
Penalty - HELD THAT:- Section 80 of the Finance Act, 1994, as it stood during the relevant period, provided that penalty not to be imposed in certain cases when the assessee is able to establish reasonable cause for non-payment of Service Tax - this is a fit case to invoke Section 80 of the Act ibid. to set aside the penalty imposed on the appellant under Sections 77 and 78.
The impugned order is modified to the extent of setting aside the penalties imposed under Sections 77 and 78 of the Finance Act, 1994, without disturbing the confirmation of demand of Service Tax along with interest - appeal allowed in part.
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2023 (3) TMI 442
Levy of penalties u/s 77 and 78 of the Finance Act, 1994 - delayed payment of Service Tax as well as non-payment of service tax - delay in filing returns - suppression of facts or not - HELD THAT:- The provision of Sub-section (3) of Section 73 of the Finance Act, 1994 provides that no Show Cause Notice is to be issued when the assessee has paid the Service Tax along with interest. The Learned Counsel for the appellant has submitted that the delay in paying the Service Tax was due to financial hardships. On being pointed out by the internal audit group, the appellant has immediately paid the Service Tax along with interest. It is also to be stated that the appellant has accounted the amounts received by them as well as the details of transactions. To such extent, there has been no suppression of facts on their part.
The words ‘suppression of facts’ are preceded by the word ‘fraud’ and therefore, there should be some positive act on the part of the appellant so as to evade payment of Service Tax, to saddle the burden of intention to evade payment of Service Tax. In the present case, there are no suppression of facts on the part of the appellant. Delay in payment of Service Tax due to financial hardships cannot always be considered to be ‘suppression of facts.’ - An assessee who has suppressed figures in their account or issued parallel invoices so as to evade the payment of tax will not be covered under sub-section (3) of Section 73 of the Finance Act, 1994. Here, apart from a vague allegation, there is no evidence that the appellant has suppressed facts with the intent to evade payment of tax.
In the case of COMMISSIONER OF SERVICE TAX, SERVICE TAX COMMISSIONERATE VERSUS VEE AAR SECURE [2011 (1) TMI 716 - KARNATAKA HIGH COURT], it was held that when upon being pointed out, the assessee got themselves registered with the Service Tax Department and paid the entire Service Tax with interest, the penalty imposed was unwarranted.
The Learned Authorized Representative for the Department has relied upon the decision in the case of M/S. NEBULA COMPUTERS PVT. LTD. VERSUS COMMISSIONER OF GST & CENTRAL EXCISE, CHENNAI [2023 (2) TMI 897 - CESTAT CHENNAI]. In the said case, the Tribunal has refused to take note of the plea raised by the appellant therein that the tax was not paid due to financial hardship, which is a view taken on the facts and circumstances of the said case that undue sympathy is not required. The said decision is therefore distinguishable on facts.
The penalties imposed are unwarranted and require to be set aside - The impugned order is modified to the extent of setting aside the penalties imposed under Sections 77 and 78 of the Finance Act, 1994 - Appeal allowed in part.
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2023 (3) TMI 441
Refund of service tax paid on input services used for export of goods - correlation of export documents with the export shipping bill - non submission of RCMC Certificate - classification of port services and technical inspection and certification service.
Correlation of export documents with the export shipping bill - HELD THAT:- It is found that the appellant have submitted all the documents and A1 form before the Adjudicating Authority as well as before the Commissioner (Appeals). the Commissioner (Appeals) on this point discussed in detail that the A1 form bearingthe details of shipping bill on the basis of which the corelation was established. the Commissioner (Appeals) observed that in form A-1 submitted by the respondent they had provided the names of the service provider as per the shipping bill as well as the corresponding service tax invoice. On the perusal of such A1 form, the Commissioner (Appeals) came to the conclusion that the respondent had corelated the shipping bills with the invoices issued by the service provider. In view of this, the objection of the revenue on this ground is not sustainable.
Non submission of RCMC Certificate - HELD THAT:- It is undisputed position that there was no Export Promotion Council sponsored by the Ministry of Commerce or the Ministry of Textiles for promotion of export of metallurgical coke, when this be so then there is no need of RCMC certificate for sanction of a refund claim.
Classification of port services and technical inspection and certification service - revenue has objected that looking to the nature of water front royalty charges and weigh bridge charges the same having no nexus to a vessel or goods - HELD THAT:- There is no dispute that for these services the Mundra port and SEZ Ltd raised the invoices in the favour of respondent and classifying the same under port services. It is the settled position of law that the classification of service at the recipient end cannot be questioned therefore, the services classified under port service attained finality and the consequential benefit should go to the assessee. Similarly in the case of technical inspection and certification service invoices for various services were raised by M/s. Inspectorate Griffith India Ltd under the service tax head of technical inspection and certification service therefore, it cannot be disputed that the service received by the respondent is different from technical inspection and certification service. The Learned Commissioner (Appeals) considering the fact of this case rightly extended the refund to the respondent.
The issues raised by the Department have been considered in the various judgments. In the case of UNION OF INDIA THROUGH THE COMMISSIONER, CENTRAL EXCISE AND SERVICE TAX, UDAIPUR VERSUS M/S. ARIHANT TILES AND MARBLES (P) LTD. [2019 (1) TMI 73 - RAJASTHAN HIGH COURT] the Hon’ble Rajasthan High Court allowed the refund under identical Notification No 41/2007-ST wherein it was observed that the Tribunal correctly holding that irrespective classification service, if service are provided within port they should qualify as port service for the purpose of benefit of refund - In the case of M/S. MACRO POLYMERS PVT. LTD. VERSUS CCE AHMEDABAD [2010 (6) TMI 257 - CESTAT, AHMEDABAD] this Tribunal held that refund under Notification No. 41/2007 is admissible on terminal handling charges even though same is not specified under the notification but for the reason that the said service is provided by the port authority.
The ld. Commissioner (appeals) has passed a very reasoned order by giving proper finding on each issue arising out of the order-in-original - there are no infirmity in the impugned order, hence the same is upheld - appeal of Revenue dismissed.
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2023 (3) TMI 440
Maintainability of appeal - non-compliance with the requirement of pre-deposit under service tax - Applicability of section 35F of the Central Excise Act - HELD THAT:- A Division Bench of Delhi High Court in M/S. VISH WIND INFRASTRUCTURE LLP, M/S. J.N. INVESTMENT & TRADING CO. PVT. LTD. VERSUS ADDITIONAL DIRECTOR GENERAL (ADJUDICATION) , NEW DELHI [2019 (8) TMI 1809 - DELHI HIGH COURT] examined the provisions of section 35F of the Central Excise Act, 1944 and held that every appeal filed before the Tribunal after the amendment made in section 35F of the Excise Act and section 129E of the Customs Act on 06.08.2014 would be maintainable only if the mandatory pre-deposit was made. In coming to this conclusion, the Division Bench relied upon the judgment of the Delhi High Court in ANJANI TECHNOPLAST LTD. VERSUS THE COMMISSIONER OF CUSTOMS [2015 (10) TMI 2446 - DELHI HIGH COURT] and also observed that in view of the peremptory words ‘shall not’, there is an absolute bar on the Tribunal to entertain any appeal unless the requirement of pre-deposit is satisfied.
The Madhya Pradesh High Court in ANKIT MEHTA VERSUS COMMISSIONER, CGST INDORE [2019 (3) TMI 1342 - MADHYA PRADESH HIGH COURT] also dismissed the Writ Petition that had been filed against the order of the Tribunal dismissing the appeal for the reason that the required pre-deposit was not made. The contention that was advanced before the Tribunal and before the Madhya Pradesh High Court was that the appellant was not in a position to make the pre-deposit due to financial constraints. After examining the provisions of section 129E of the Customs Act, the Madhya Pradesh High Court observed that section 129E does not empower the Tribunal or the Commissioner (Appeals) to waive the pre-deposit or to reduce the pre-deposit , this Court is also not inclined, keeping in view the aforesaid statutory provisions of law to waive or reduce the pre-deposit and, therefore, no case for interference is made out in the matter. Accordingly, the Writ Petition is dismissed.
The appellant has not made the pre-deposit. In view of the aforesaid decisions of the Delhi High Court and the Madhya Pradesh High Court, it is not possible to permit the appellant to maintain the appeal without making the required pre-deposit.
As the statutory requirement has not been complied with, the appeal would have to be dismissed and is, accordingly, dismissed.
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2023 (3) TMI 439
Waiver of service tax - demand dropped on the ground that the respondent need not pay service tax as sub-contractor when the main contractor itself has discharged the service tax liability - service tax is liable to be paid on works contract prior to 1.6.2007 or not - extended period of limitation - HELD THAT:- This is deemed to be a fit case to remand the matter to the original authority to re-adjudicate the matter taking into account the liability of sub-contractor to pay service tax as per Melanage Developers Private Limited and the classification of the service and exigibility of the service tax on composite works as per COMMISSIONER, CENTRAL EXCISE & CUSTOMS VERSUS M/S LARSEN & TOUBRO LTD. AND OTHERS [2015 (8) TMI 749 - SUPREME COURT] - As there was confusion regarding the exigibility of the service tax, we find that the respondent had reason to believe that it was not liable to pay service tax and, therefore, extended period of limitation could not have been invoked. Therefore, only the demand of the normal period of limitation can be sustained. The appeal is remanded to the original authority to re-determine the service tax liability.
Appeal allowed by way of remand.
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2023 (3) TMI 438
Classification of services - Port service or Cargo Handling Service? - service provided by the appellant within the port area - CENVAT Credit of service Tax on input services which has been provided for the services in relation to export Cargo - Credit was denied only on the ground that the same was utilized for payment of service tax on Cargo Handing Service in respect of export of Cargo which is excluded from the definition of Cargo Handling Service under Finance Act, 1994 - SCN is time barred or otherwise - penalties under Section 76 and 78 of Finance Act, 1994.
CENVAT Credit - HELD THAT:- Even though the export Cargo Handling Service is not taxable but the appellant have admittedly paid the service tax and the same was accepted by the department as no objection was raised regarding the payment of service tax. In this fact, when the appellant has paid the service tax, the input service credit is admissible.
The appellant have paid more amount of service tax as against the input tax credit, therefore, there is revenue neutral situation in the present case, however, this worksheet was given first time before this Tribunal which needs to be verified - As regard, the Cenvat credit in respect to the input service used in the non taxable output service on which the service tax paid this Tribunal has considered the issue in GATEWAY DISTRIPARKS LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, RAIGAD [2018 (5) TMI 1138 - CESTAT MUMBAI] where it was held that Though the adjudicating authority decided the matter on principle but did not verify factual aspect of amount of cenvat credit attributed to the exempted cargo handling service vis-a-vis service tax paid by the appellant in respect of export cargo handling service, if it is found to be correct that that appellant have paid service tax which is more than the cenvat credit attributable to the export cargo handling then the demand will not exist.
The matter needs to be re considered in the light of the above observation as well as the judgment on the identical issue - Appeal allowed by way of remand.
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2023 (3) TMI 379
Levy of Service Tax - Technical Testing and Analysis (TTA) services or mining services - service tax for the period 10.9.2004 to 31.3.2008 demanded under TTA services but assessee paid tax under mining services - it is the submission of the learned counsel that once it is undisputed that from 1.6.2007, the services rendered by the appellant fall under ‘mining services’, they cannot be classified under any other category prior to that date - time limitation - suppression of facts or not - HELD THAT:- It is undisputed that the appellant provides wireline logging, perforation and data processing services to ONGC and OIL. The appellant has been paying service tax on these three services from 1.6.2007 under the head ‘mining services’ and the department has not disputed this classification of the service. Once the department accepted that these are ‘mining services’, it cannot, simultaneously, classify them under TTA services. Unless the department can establish that the appellant was wrong in classifying these services under ‘mining services’ and the department itself was equally wrong in accepting their classification under ‘mining services’, the department cannot classify the services under any other head, including TTA - it is not found in the impugned order explaining why the department and the appellant were both wrong in classifying them as ‘mining services’. Therefore, the demand cannot be sustained on merits.
Time Limitation - HELD THAT:- The scheme in Finance Act, 1994 is that if the assessee does not self-assess tax correctly, the remedy against it is the ‘Best Judgment Assessment’ under section 72. This provision is similar to the provision for re-assessment under Section 17 (4) of the Customs Act, 1962. The Commissioner imagined that wrong self-assessment by an assessee would amount to deliberate mis-declaration and suppression of facts with intent to evade. As per the Finance Act, 1994, if the assessee wrongly self-assesses tax in its returns and none of the five elements required to invoke extended period of limitation is present and if the demand gets time-barred, the responsibility for it rest squarely on the officer who had the jurisdiction and the mandate to the Best Judgment assessment under section 72 but has not done so and NOT on the assessee. Therefore, the invocation of the extended period of limitation cannot be sustained.
Demand of interest and penalties - HELD THAT:- The demand of interest and penalties also deserve to be set aside as it is held in favour of the appellant both on merits and on limitation.
Appeal allowed.
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2023 (3) TMI 333
Framing of an assessment during pendency of CIRP - Moratorium period or not - proceedings for assessment had commenced after the petition under Section 7 of the Insolvency and Bankruptcy Code, 2016 was admitted by the National Company Law Tribunal (NCLT) and a Corporate Insolvency & Resolution Process (CIRP) had commenced - petitioner claims that in terms of Section 14 of the IBC, no such proceedings could be commenced against the petitioner - demand of service tax - CENVAT Credit.
HELD THAT:- Pendency of CIRP confers no impediment in framing the assessment. But no recovery proceedings can be initiated for recovery of the liability assessed. This is clear from the following extract from the decision in SUNDARESH BHATT, LIQUIDATOR OF ABG SHIPYARD VERSUS CENTRAL BOARD OF INDIRECT TAXES AND CUSTOMS [2022 (8) TMI 1161 - SUPREME COURT] where it was held that the respondent could only initiate assessment or reassessment of the duties and other levies. They cannot transgress such boundary and proceed to initiate recovery in violation of Sections 14 or 33(5) of the IBC. The interim resolution professional, resolution professional or the liquidator, as the case may be, has an obligation to ensure that assessment is legal and he has been provided with sufficient power to question any assessment, if he finds the same to be excessive.
Merits of the case - HELD THAT:- This Court does not consider it apposite to entertain this challenge as the petitioner has an equally efficacious remedy of filing an appeal.
The petitioner is, essentially handicapped on account of requirement of making a pre-deposit for availing the statutory remedy of an appeal. Given the nature of challenge and also the fact that the petitioner’s company is undergoing CIRP, it is considered apposite to direct that in the event, the petitioner prefers appeal(s) within a period of two weeks from today, the same would be entertained uninfluenced by any question of delay or insistence of any pre-deposit.
Petition disposed off.
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2023 (3) TMI 332
Classification of services - services availed by the Appellant from Verizon Inc (located outside India) - classifiable as ‘Internet Telecommunication Service’ or are classifiable as ‘Leased Circuit Service’ (upto 31 May 2007) and there after ‘Telecommunication Service’, having been provided by an entity not qualifying to be a Telegraph Authority - Cenvat credit of alleged service tax liability - extended period of limitation - penalty - revenue neutrality - HELD THAT:- The issue herein is squarely covered by the precedent ruling of this Tribunal, co-ordinate bench in TCS E-SERVE LTD. VERSUS COMMISSIONER OF SERVICE TAX, MUMBAI [2014 (6) TMI 655 - CESTAT MUMBAI]. In the facts of the said case TCS E-Serve was engaged in providing call centre services, collection and sales services and computerised data processing services to various customers in India and abroad, were registered with the department of service tax under the category of ‘BAS’ & ‘BSS’ - This Tribunal held that service tax liability does not arise under Section 66A of the Finance Act, if service is not specified under Section 65(105) of the Finance Act.
Applying the ratio, the Tribunal held that it is not enough that the service provider provides lease services but it should also be a ‘Telegraph Authority’ as defined in the Act. Unless both the conditions are cumulative satisfied, service tax levy is not attracted.
Appeal allowed - the question of limitation left open.
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2023 (3) TMI 300
Short payment of service tax - real estate development - transactions for development, purchase and transfer emanated from the Memorandum of Understanding concluded with RBEHWS - activities should be construed as ‘service’ as contemplated under Section 65B[44] of the Finance Act or not - mis-declaration in filing ST-3 returns or not - HELD THAT:- The first respondent has not examined the petitioner’s transactions with RBEHWS, with the land owners who have offered their respective lands for joint development and with the purchasers who have purchased plots in the lands owned by the petitioner. This Court must opine that, if it cannot be disputed that mere transfer of title in immovable properties either by way of sale or gift or in any other manner would not amount to a taxable service, for a complete adjudication of the petitioner’s liability, not just to pay appropriate service tax but also interest and penalty, the first respondent should have examined the aforesaid transactions separately and decided the petitioner’s liability; if for any reason, the petitioner’s bouquet of transactions is to be considered as inseparable and a composite transaction, and hence subject to service tax, there must be justifiable reasoning for the same.
On a perusal of the first respondent’s reasoning, this Court would only conclude that these aspects have not been considered, and if these aspects are not considered and liability fastened, the first respondent would have to usurped jurisdiction even insofar as those transactions which are only transactions for transfer of title.
Hence the petitioner must succeed on this score and the proceedings restored to the first respondent for reconsideration - Petition allowed in part.
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2023 (3) TMI 299
Rejection of application filed under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - petitioner has primarily challenged the impugned order on the ground of violation of principles of natural justice and on the ground that the impugned order is a cryptic and non-speaking order - HELD THAT:- In the case on hand, the petitioner, during the course of investigation, has, by its letter dated 03.09.2018, even though has admitted its tax liability for the assessment years 2014-15 to 2016-17 amounting to a sum of Rs.1,59,69,579/-, the same has not been accepted by the respondents. The petitioner has also not paid the entire amount of Rs.1,59,69,579/-. If the contention of the petitioner has to be accepted by this Court, then, in all cases, where, a person discloses even a meagre amount as service tax liability though he is liable to pay huge amount, they will also be brought under the purview of the Scheme and that would not have never been the intention of the legislature. Therefore, it is very clear that the amount of service tax liability has to be quantified in agreement with the respondents to enable the petitioner to come under the purview of the Scheme - Having not quantified in accordance with the Scheme, the question of accepting the petitioner's letter dated 03.09.2018 for the purpose of the Scheme will not arise and that is the reason as to why the impugned order dated 27.02.2020 has been passed rejecting the petitioner's application.
A Division Bench of this Court in the case of VITALRAO JAYAPRAKASH VERSUS THE DESIGNATED COMMITTEE UNDER THE SABKA VISHWAS (LEGACY DISPUTE RESOLUTION) SCHEME, 2019, THE COMMISSIONER, THE SENIOR INTELLIGENCE OFFICER, THE COMMISSIONER, CHENNAI NORTH COMMISSIONERATE, CHENNAI [2022 (3) TMI 454 - MADRAS HIGH COURT], had an occasion to decide the issue as to when the Scheme can be applied. In paragraph no.12 of the said judgment, it has been made clear that unless and until the tax liability is quantified, the question of availing the benefits of the Scheme will not arise.
In the instant case, excepting for the petitioner's letter dated 03.09.2018 intimating the respondents about its service tax liability for the subject assessment years, there is no quantification done by the respondents and they have also not accepted the petitioner's statement, as per its letter dated 03.09.2018. Furthermore, the petitioner has not sought to avail the benefits under the subject Scheme in the said letter on or before 30.06.2019 and therefore, the first respondent has rightly rejected the petitioner's application on the ground that the petitioner is not eligible to come under the Scheme.
Having not requested for personal hearing, the claim of the petitioner that no opportunity of hearing was granted to him before rejecting his request to fall under the Scheme will not arise at this stage. The impugned rejection order being a system generated one based on the particulars furnished by the petitioner that too when the petitioner has not requested for any personal hearing and that too when an earlier request has been rejected on 13.01.2020, this Court does not find any infirmity in the impugned order warranting interference.
This writ petition is devoid of merits and accordingly, the same stands dismissed.
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2023 (3) TMI 298
Non-payment of Service Tax - Site Formation Service - Cargo Handling Service - Commercial or Industrial Construction Service provided to various clients - period from July 2008 to December 2008.
Non-reliance of documents in support to propose tax liability - principles of audi alteram partem violated (natural justice) - HELD THAT:- There is no dispute that a Show Cause Notice is the foundation on which the Revenue would build its case and hence, it is quintessential that a Show Cause Notice should reflect all such supporting evidences in support of each proposal for demand of respective duty / tax - there is no dispute even by the representative of the Revenue that nowhere in the Show Cause Notice is it mentioned as to the relied upon documents nor is there any averment about supplying such relied upon documents to the noticee.
Further, it is also clear from a perusal of the Show Cause Notice that it has been alleged that the appellant provided the services mentioned thereunder, that they did not pay the Service Tax on those services and that the verification carried out by the audit party warranted the invocation of extended period for demanding the tax due. Thus, it is very clear from the Show Cause Notice that there is not even a single assertion proposing to levy and collect Service Tax on the basis of any specific document / evidence.
From the discussions in the impugned Order-in-Original, it is found that it was the appellant who furnished most of the documents voluntarily, though no mention about any of the documents finds place in the Show Cause Notice. It is these very documents that were sent for verification to the jurisdictional Service Tax authority and hence, it would be incumbent upon the lower authority to have provided such report obtained from the jurisdictional Service Tax authority before fastening the appellant with tax liability - the liability was fastened on the appellant without following the principles of audi alteram partem and clearly, the consequential demands raised cannot sustain.
Site Formation Services for which the appellant has relied on exemption Notification No. 17/2005-S.T. dated 07.06.2005 - HELD THAT:- The exemption has been granted for site formation and clearance, excavation and earth moving and demolition and such other similar activities referred to in sub-clause (zzza) of clause (105) of Section 65 of the Finance Act, provided to any person by any other person in the course of construction of roads, airports, railways, etc., which Notification was interpreted by the co-ordinate Chandigarh Bench of the CESTAT in the case of M/s. Ludhiana Builders [2019 (10) TMI 1327 - CESTAT CHANDIGARH] wherein the Learned Bench has held that Notification No. 17/2005-S.T., dated 7-6-2005 does not say that if it is not a public road then it is liable to be taxed. Therefore, we hold that the appellant is engaged in the construction of road and the same is exempt as per the Notification No. 17/2005-S.T., dated 7-6-2005, therefore, no service tax is payable by the appellant - Thus, the appellant is well within its right to claim bona fides as to the non-payment of Service Tax.
Demand pertaining to Cargo Handling Services - HELD THAT:- If the Adjudicating Authority had any doubts that the appellant did undertake any other activity other than transportation inviting tax liability, then the same should have been put across to the appellant for rebuttal / explanation thereby providing an opportunity to the appellant to meet the allegations levelled against it. Contrary to this, the Adjudicating Authority refers the matter to the jurisdictional tax authority, obtains a report and proceeds to confirm the demand based solely on such report obtained behind the back of the appellant. Moreover, the name of the party as mentioned at Annexure-II to the Show Cause Notice refers to ICL and HCC whereas in the Order-in-Original, the lower authority has referred to ICL and ACC, which was perhaps based on the unrebutted report obtained by the lower authority - it is found that there are serious inconsistencies, that the conclusion arrived at by the Adjudicating Authority appears to be in a haste and without proper application of mind and also that the principles of natural justice have not been followed.
Construction services rendered to M/s. Petron Civil Engineering (P) Ltd., against which it was claimed by the appellant that the principal contractor had paid the Service Tax, which fact has been brushed aside by the lower authority by relying upon the Master Circular No. Circular No. 96/7/2007-S.T. dated 23.08.2007 - HELD THAT:- There are substance in the contentions of the Learned Advocate for the appellant that the said Circular can operate only prospectively, as clarified by the Hon’ble Supreme Court in the case of M/s. Suchitra Components Ltd. [2007 (1) TMI 4 - SUPREME COURT] wherein the Hon’ble Court held that when the circular is against, the assessee, they have right to claim enforcement of the same prospectively.
Denial of CENVAT Credit on capital goods which has been denied on the ground that the noticee did not turn up with documents for verification by the jurisdictional Service Tax authority - HELD THAT:- It is the settled position of law that no CENVAT Credit shall be allowed on capital goods used exclusively in the manufacture of exempted goods or in providing exempted services; but from a perusal of the Show Cause Notice or the impugned Order-in-Original, nowhere it is seen that the lower authority has placed reliance on any evidence to support that the appellant was indeed engaged in the manufacture of exempted goods or was providing exempted services.
Even on merits, the demands proposed in the Show Cause Notice, which thereafter have been confirmed in the impugned Order-in-Original, are without any basis or without any documentary evidence and that there is serious violation to the principles of natural justice and hence, no part of the demand can be sustained.
Appeal allowed.
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2023 (3) TMI 297
Levy of Service tax - Tour Operator Services - running of ropeways from base stations to temples and transportation on road between base station of the temples - HELD THAT:- The appellant placed reliance upon the decision rendered in the case of the appellant in M/S. / USHA BRECO LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, DEHRADUN [2018 (11) TMI 1756 - CESTAT NEW DELHI] for the period from September 2004 to March 2014 to contend that the demand confirmed by the Commissioner (Appeals) should be set aside - it was held in the case that in the present case, appellants basically provides mere transportation facility which is open to pilgrims/tourists persons even villagers to go uphills and therefore, in our view, same cannot be classified and charged to service tax under the category of ‘tour operator’ service.
The facts of the present case are identical to the facts of the aforesaid decision of the Tribunal rendered in the case of the appellant - In view of the aforesaid decision, it has to be held that the activity undertaken by the appellant cannot be subjected to service tax under the category of ‘tour operators’.
Appeal allowed.
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2023 (3) TMI 296
CENVAT Credit - improper documents as prescribed under Rule 9(1) of CCR - credit taken on the basis of ‘running account bills’ prepared by the staff of the appellant (service receiver) containing measurement of work and amount to be paid to the Contractor (service provider) - It appeared, these bills do not contain the mandatory information required for availing Cenvat credit in terms of Rule 9(1) of CCR - period April 2015 to March 2017 - HELD THAT:- It is not in dispute that the appellant PSU have prepared the running bills as per the norms prescribed by the State Government. It is not disputed that such running bills are not genuine, or payment to the service provider/contractor have not been made as per the running bills, after adjustment of various if any like Income Tax at source, Vat at source, security deposit, etc. It is further found that this is a case of failure to exercise jurisdiction by the court below in verifying the genuineness of the transaction and allowing the credit accordingly, wherein in Rule 9(2) of CCR read with proviso it has been prescribed that-where a document does not contain all the particulars but contains substantial particulars, inter alia details of service tax payable, description of service etc.
The assessing officer on being satisfied that the goods on services covered by the said documents have been received and accounted for in the books of account of the receiver, he may allow the Cenvat credit - there is no such contrary finding in the orders of the court below as regards non receipt of service or the Cenvat credit taken being sham or fake.
The Cenvat credit in under dispute is allowable to the appellant-assessee - Appeal allowed.
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2023 (3) TMI 240
Non-issuance of Discharge Certificate in Form SVLDRS 4 as per Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS) as per provision of Section 127(8) of the Finance Act, 2019 - HELD THAT:- It is not in dispute that the petitioner as required under the law had made the payment twice. Both the times, it had twice been recredited in his account and therefore, for the third time, it needed to make a payment and by then, the time limit prescribed had already been over.
The order in case of M/s Yashi Contructions [022 (3) TMI 110 - SC ORDER], taken note of, where the Apex Court while endorsing the refusal of the relief by the High Court for extension of period to make the deposit under the scheme, held that the settled proposition of law is that the person who wants to avail the benefit of a particular scheme has to abide by the terms and conditions of the scheme. If the time extended is not provided under the scheme, it will then tantamount to modifying the scheme which is the prerogative of the government. Here is not the case where any extension sought for not having been granted where request on the part of the petitioner would also not tantamount to modifying the scheme as he was never at fault. Twice when he made an attempt, he failed on account of technical glitch.
Applying the ratio laid down by the Apex Court mutandis mutandis in the case of the present petitioner who was not under the fault when this amount could not get deposited with the bank and was recredited after having once gone to the bank, to deny him the benefit only because there were technical glitches about which it could not have done anything, would amount to leaving the petitioner remediless which is impermissible under the law and this also since has been succinctly addressed by the Apex Court., following the decision in the case of M/s Shekhar Resorts Limited [2023 (1) TMI 256 - SUPREME COURT] this petition is being allowed.
The payment as per the directions of the committee was needed to be made by 30.6.2020 which instead had been made on 8.7.2020. Not only the Court can be oblivious of the Covid 19 pandemic being at its peak during that period for generating the payment was something where there was no say of the petitioner. Therefore, not only the respondents denial for considering the case but later recovery of the entire amount of Rs 7,68,675/- on 11.7.2022 shall need to be reverted/refunded to the petitioner.
Accordingly the petition is allowed.
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2023 (3) TMI 239
Levy of Service Tax - remuneration collected from the member units for the activity of treatment of effluent water - N/N. 08/2017-S.T. dated 20.02.2017 - HELD THAT:- The said activity has been exempted from the levy of Service Tax vide Notification No. 08/2017-S.T. dated 20.02.2017 - Since the activity is exempt from the levy of Service Tax as per the above Notification, there are no hesitation to hold that the demand cannot sustain and requires to be set aside.
The impugned order is set aside - appeal allowed.
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2023 (3) TMI 238
Refund of CENVAT Credit - management consultancy service - real estate agent service - garden maintenance - club and association service - negative list services or not - HELD THAT:- From perusal of rule 5 of CENVAT Credit Rules, 2004, it is seen that it is not the utilization of input/input service in exports that has prompted this attractive neutralization scheme but the restricted scope for utilization of credit legitimately availed towards discharge of duty or tax liability. Though referred to as refund, it is also not refund in the true sense that the claimant is not ‘person liable to pay tax or duty’ having had to pay such duty or tax despite lack of authority of law; the discharge of tax liability by the provider of service, and in accordance with authority of law, is not in question at all. The intent is to neutralize the taxes included, thereby, in the value of goods manufactured or service so that taxes are not exported too.
The limited remit of the sanctioning authority, subject to procedural prescription separately notified, is spelt out in the rule itself to limit denial, if any, only to such contingencies and disallowance, if at all, is restricted to the ascertainment of proportion in accordance with that borne by exports to total turnover as mathematical attribution.
This has been held by the Tribunal in KKR INDIA ADVISORS PVT. LTD. VERSUS COMMISSIONER OF CGST, MUMBAI CENTRAL AND VICE-VERSA [2018 (6) TMI 797 - CESTAT MUMBAI] where it was held that The first step is to a show cause notice invoking Rule 14 of the Cenvat Credit Rules, 2004 for denial of the cenvat credit. Then only the refund can be rejected which was not done. Obviously the refund claim cannot be rejected by disputing the admissibility of the input services.
It is seen from the impugned order that no such notice was issued to the appellant herein. The preliminary objections to the refund limited itself to a few objections that appear to have been responded to and none of those have proposed that the said amount of credit was to be recovered. In the absence of this critical requirement to comply with principles of natural justice, the denial of credit is without authority of law and impugned order is set aside.
Appeal allowed.
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2023 (3) TMI 237
Rejection of refund claim for refund of service tax filed by the appellant - excess payment of service tax not in dispute - reverse charge mechanism - time limitation - principles of unjust enrichment - HELD THAT:- Undisputedly and admittedly appellant has paid certain amounts under reverse charge mechanism by making self assessment of service tax payable under the reverse charge mechanism, on the basis of the “Trade License Agreement” entered into with their principals at Thailand for the use of their trade name/ brand name. Subsequently the value of the taxable service got revised downwards as after negotiations the period of the agreement was revised and also the consideration to be paid. Accordingly the principals issued the credit note on 31.08.2017 for the period 01.01.2017 to 31.03.2017 and revised invoice 20.10.2017 for the period 01.04.2017 to 30.06.2017. For the period 01.04.2017 to 30.06.2017 appellant had filed the return as prescribed under ST-3 format on 14.08.2017. The present claim for the refund of excess service tax paid has been made by the appellant on 03.04.2018. Appellant submit that as per Article 265 of the Constitution of India, Government cannot retain the excess of tax paid and the same needs to be refunded.
Admittedly no revised return as provided for in terms of Rule 7B of the Service Tax Rules, 1994 or under provisions of the Section 142 (9) of the CGST Act has been filed by the appellant. In para 4.6 and 4.7 of the order in original, Assistant Commissioner has recorded specific finding to this effect and impugned order upholds the same in para 11 and 12. It is settled provision in law that the when the statute provides a manner of doing the thing, then the thing has to be done in the prescribed manner only and all other manner are necessarily barred.
Principles of unjust enrichment - HELD THAT:- The issue of unjust enrichment comes into picture only if the refund is otherwise found admissible. In the case under consideration if the refund is not found admissible, application of the principles of unjust enrichment need not be considered.
Appeal dismissed.
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