TMI Blog2011 (2) TMI 671X X X X Extracts X X X X X X X X Extracts X X X X ..... excisable products. During the period of dispute (16-11-1997 to 1-6-1998), they availed goods transport operator s service (GTO service) for transportation of materials to their factories, but did not pay service tax on the freight, nor did they file any service tax return. The department issued show-cause notices, in December 2001 in the case of M/s. Adinath SSK Ltd. and in 2002 in the case of other assessees, demanding service tax on the freight paid by them for the above transportation of materials. Recipients of GTO service were liable to pay service tax under the proviso to sub-section (1) of Section 68 of the Finance Act, 1994 for the period from 16-7-1997 to 2-6-1998. Hence the above demand of service tax. The show-cause notices also demanded interest on tax and proposed penalties. These proposals were contested. In adjudication of the dispute, the original authority confirmed the demands and, in most cases, imposed penalties. Aggrieved by the orders-in-original, the assessees preferred appeals to the Commissioner (Appeals). The appellate authority upheld the orders of the lower authority in the cases of M/s. Pandurang SSK Ltd., M/s. Adinath SSK Ltd. and M/s. Indo Rama Synt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Finance Act, 1994 by the Finance Act, 2000 and the Finance Act, 2003 and after considering the Apex Court s judgment in Laghu Udyog Bharati - 1999 (112) E.L.T. 365 (S.C.) = 2006 (2) S.T.R. 276 (S.C.), held that the above show-cause notices issued under Section 73 of the Finance Act, 1994 were not maintainable. It was noted that while service providers were liable to file returns under Section 70, recipients of GTO service and clearing forwarding (C F) service were liable to file returns under Section 71A. It was further noted that the class of persons, who were liable to file returns under Section 71A, had not been brought under the net of Section 73. On this basis, it was held that the show-cause notices issued to M/s. L.H. Sugar Factories Ltd. (recipients of GTO service) under Section 73 of the Finance Act, 1994 were not maintainable. The civil appeals filed by the department against the Tribunal s decision in L.H. Sugar Factories case were dismissed by the apex court. The short but self-contained judgment of the Apex Court is reproduced below :- [Judgment]. - We have heard Counsel for the parties. 2. Learned Counsel for the parties have drawn our notice to the relevant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d of two weeks. The learned SDR has construed these observations of the apex court to mean that, where a person is liable to pay service tax under the proviso to Section 68(1) and to file returns under Section 71A of the Finance Act, 1994, he has to do so within the extended period granted by the court irrespective of the provisions of Section 73 of the Act. We have found it difficult to agree with the SDR. As we have already indicated, the substantive issue before the apex court in Gujarat Ambuja Cements case was whether certain provisions of the Finance Act, 2000 and the Finance Act, 2003 were constitutionally valid or not. The Court s observations in passing can have no overriding effect on the view taken by a co-ordinate Bench of the same Court at a later point of time which is the view taken in L.H. Sugar Factories case. Even if it be assumed that contrary time were taken by Coordinate Benches of the Apex Court in the cases of Gujarat Ambuja Cements and L.H. Sugar Factories, the one taken at later point of time (L.H. Sugar Factories) should prevail. 6. On a perusal of the orders passed by this Tribunal in the cases of Mangalam Cements Ltd. and Agauta Sugar Chemicals, we no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, 1994 appropriately for recovery of service tax. Moreover, the corrigenda to the show-cause notices did not have the effect of altering the dates of issue of those notices. The corrections/amendments proposed in the corrigenda only dated back to the original dates of issue of show-cause notices. The fact remains that, even when the corrigenda were issued, Section 73 of the Finance Act, 1994 remained without mention of Section 71A therein. 8. The learned SDR has vehemently argued about the legislative intent behind the relevant provisions of the Finance Act, 1994. It has been submitted that the intention was to authorize the Revenue to recover service tax dues from both categories, viz., service providers and recipients of GTO/C F services. According to the learned SDR, the text of Section 73, as it stood prior to 10-9-2004, should be liberally construed so as to achieve the legislative purpose. In this connection, he has relied on CIT, Thiruvananthapuram v. Baby Marine Exports - 2007 (211) E.L.T. 12 (S.C.), Ponds India Ltd. v. CTT, Lucknow - 2008 (227) E.L.T. 497 (S.C.) and Directorate of Enforcement v. Deepak Mahajan - 1994 (70) E.L.T. 12 (S.C.) (paragraphs 24 to 27). It has b ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
