9911796707
TMI Blog2004 (8) TMI 604X X X X Extracts X X X X X X X X Extracts X X X X ..... mits that 'tax collected' and 'tax payable' have been declared by the Appellants in their returns. If so, no further documents were required for raising of any demand when tax provisionally paid was also known. If 'tax payable' and 'tax provisionally paid' were known during the relevant time, 'tax collected' was not required to be looked into and the notice and order do not dispute the amount of 'tax payable' and 'tax provisionally paid' as per the returns submitted. Therefore, demanding the differential tax on the basis of 'tax collected' except for one month, i.e., April 1996 for the year, 1996-97 without any sanction of law during the relevant period when the tax payable is less than tax provisionally paid is not tenable in law. For the year, 1996-97, there had been excess payment of Service Tax of Rs. 2,93,199/- and for the years 1994-95 to 1999-2000 excess payment is to the extent of Rs. 26,10,924/-. According to the Appellant, there is excess payment of Rs. 26,10,928/- and according to the Revenue, there is short payment of Rs. 29,13,070/-. I take up the Appeals for analysis, discussion and orders. Appeal No. 35/2004-MII (ST) 2. This appeal arises out of the Order-in- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x paid as per the provisional return and excess/short payments of service tax is determined and the net short payment, according to the department is Rs. 29,73,070/-. (c) An amount of Rs. 84,97,244/- was sought to be demanded as interest under Sec. 75 of the Act read with Rule 6 of the Rules on the short payment of service tax upto 30-4-2000. (d) An interest of Rs. 9,18,536/- was also demanded on the ground of belated payment of service tax for the month of March 1995. According to the department as against the due on 15-4-1995 the appellants have remitted the tax on 17-4-1995. The appellants replied to the said show cause notice on 29-5-2002 and also filed written statement on 26-7-2002. The appellants appeared for personal hearing on 18-7-2002 and 3-10-2002 and again on 5-3-2003. Vide order in original No. 51/2003-2004 dated 30-1-2004 the Lower Authority confirmed the service tax and interest amounts as alleged in the show cause notice on the following grounds. (i) in view of Rule 6(1) of the Service Tax Rules, 1994, the Department is justified in collecting the higher amount between tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 1994-95 and 1999-2000 the department has taken the service tax collected amount for finalizing of the amount in view of the fact it showed a higher figure than the actual service tax payable under the provisions of law. (c) The Appellants also produced yearwise statements on the tax paid and the tax payable and the difference in tax. This statement confirms that for disputed period 1994-95 to 1999-2000 the taxes paid is Rs. 523,15,19,121/- and the tax payable is Rs. 522,89,08,193/- and in the process there has been excess payment of Rs. 26,10,928/-. (d) The Appellants submit that the methodology adopted by the revenue and the appellants appear to be one and the same viz. the excess or shortage gets adjusted during the subsequent months of the same financial year and both revenue and the appellants have recognized and resorted to this adjustment. The only difference being style in doing the adjustment - Revenue has taken the tax collected amount from the customers as the basis and had adjusted the sum against tax provisionally paid whereas the assessee has taken the tax actually ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... osit the tax or duty collected was introduced for the first time in Central Excise legislation through Section 11D which came into force vide Notification dated 30/91-C.E. (N.T.) dated 19-9-1991. It obligated an assessee to remit forthwith any amount collected in excess of the duty assessed or determined and paid on any excisable goods under the Act or the Rules made thereof from the buyer of such goods in any manner as duty of excess to the credit to the Central Government. The expression employed is "collected any amount in excess of the duty assessed or determined". The term "duty assessed or determined" is used vis-a-vis the term "duty collected" and hence it is clear that the duty assessed or determined cannot mean that duty collected from the buyer. Applying this scenario to Rule 9B(5) the duty provisionally assessed shall be adjusted against the duty finally assessed would only mean that difference arising out of the tax provisionally paid and the tax finally payable and not the tax as collected from the buyers. (d) In view of the fact that Rule 9B is made applicable for provisional assessment under Rule 6(4) of the Service Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vision for imposition of interest and the same would prevail over Rule 6(4) of the Service Tax Rules, 1994. The appellants contend that Sec. 75 has no application to the facts of the case. It would apply only to such cases where assessments are not provisional or where assessments have been finalized and tax not paid. The provision uses the expression "who fails to credit the tax or any part thereof to the account of the Central Government within the period prescribed". Failure to pay tax would arise only when there has been a finality to the assessment and the quantum of tax actually payable to the revenue is decided. Rule 6(4) of the Service Tax Rules is a self-contained code contemplating provisional assessment. If one were to hold the view that Sec. 75 would supersede Rule 6(4) then Rule 6(4) would be rendered otiose or redundant and every case of interest would then fall under Sec. 75 of the Finance Act, 1994. This cannot be correct. Rule 6(4) of the Service Tax Rules, 1994 is a self-contained code and it relates to provisional assessment. It refers to the applicability of the erstwhile Central Excise Rules, 1944 and after incorporation of new Central Excise Rules, 2001 the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8. Now coming finally to imposition of interest of Rs. 9,18,536/- towards belated payment. Appellants contend that the interest has been imposed for the month of March 1995. The due date for remittance was 15-4-1995 but according to the revenue, the tax has been paid only on 17-4-1995. The appellants submit that the assessment during this period was provisional and interest clause therefore would not apply during the relevant period. Further they submit that the cheque was deposited in the Indian Bank on 15-4-1995 by RBI cheque No. 454183 dated 15-4-1995 and the bank by their letter dt. 24-4-1995 clarified that the cheque was presented on 15-4-1995 and had informed that 15-4-1995 originally happened to be a full day business but subsequently changed as half a day working and therefore the related central excise challan could be released only on 17-4-1995 after realization. The appellants also rely on the clarification issued by the Directorate of Service Tax in F. No. V. DG ST/30 Misc.-46/2000 dated 23-8-2000 wherein it has been clarified that in cases where the service tax amount has been deposited by the assessee in an authorized bank by cheque before the due date and such c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nfirmed the interest of Rs. 77,61,968/- for the period 2000-2002. Since the order is common for both the cases, same are taken up together. 11. The Lower Authority has invoked Section 75 for imposition of interest for the period 2000 to 2003. The appellants drew the attention to the impugned orders in original wherein the lower authority has conceded that order for provisional assessment has been made by the Asstt. Commissioner of Service Tax on 24-7-1996. The appellants refer to para 4.1 of the CBEC supplementary instructions wherein by para 4.1 it has made clear that the interest clause and statutory time limit relating to provisional assessment is only prospective in nature and interest clause would apply one and only for provisional assessment ordered on or after 1-7-2001. 12. It is very clear from the impugned orders that the orders for provisional assessment have been made on 24-7-1996 and it is against those orders of provisional assessment final assessment order has been passed. Now the final assessment orders have been issued pursuant to the above provisional assessment orders. Having conceded the fact that the order of provisional assessment was passed on 24-7 ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
