TMI Blog2012 (9) TMI 337X X X X Extracts X X X X X X X X Extracts X X X X ..... or the Respondent. [Judgment per : Satish K. Agnihotri, J.]. The instant appeal under Section 35-G of the Central Excise Act, 1944 is directed against the order dated 3-4-2007 (Annexure A/1) passed by the Customs, Excise Service Tax Appellate Tribunal, Principal Bench, New Delhi, (for short the Tribunal ) in appeal No. ST/25/2006, ST/75/2006 [2007 (8) S.T.R. 27 (Tribunal)]. 2. The appeal of the revenue was admitted for hearing by this Court on 10-9-2010 on the following substantial questions of law : 1. Whether the respondent is liable to pay the Service tax under the provisions of Chapter V of the Finance Act, 1994 in respect of service received form their consignment agents during the period 16-7-1997 to 31-8-1999? 2. Whether the Appellant Tribunal was justified in holding that the show cause notice issued to the respondent was time barred without considering the reasons assigned by the Appellate Commissioner who held that the show cause notice issued to the appellant so far as it relates to the period from 16-10-1998 to 31-8-1999 was not time barred under Section 73 of the Finance Act, 1994? and 3. Whether the orders passed by both the forums i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this appeal. 6. Shri Maneesh Sharma, learned counsel appearing for the revenue would submit that the Tribunal ought to have decided the case on merits. He would further contend that there was no question of bona fide belief on the part of the assessee that it was not the liability of the assessee to pay the tax, and as such, this cannot be a ground for grant of relief in favour of the assessee. The respondent-assessee, despite several request made by the department, withheld the details of the activities carried out at their end and also failed to show any positive act. The levy of Service tax on the service receiver of services rendered by clearing and forwarding agent for the period 16-7-1997 to 16-7-1998 was revalidated by Section 116 and 117 of the Finance Act, 2000 by making amendment in Section 65, 66 and 67 of the Act. Under the definition of assessee under Sections 65(6) of the Act, 2000 which was amended by Section 116 of the Finance Act, 2000, it was defined as his agent; or in relation to service provided by a clearing agent, every person who engages a clearing and forwarding agent by whom remuneration or commission (by whatever name called) is paid for such service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 75 of the Finance Act, 1994 as amended at the rate as effective during the relevant period, which shall be calculated from the due date of payment as per the provisions and procedure envisaged under section 66, section 71A read with rule 7 of the Service Tax Rules, 1994. (v) to pay penalty of Rs. 500/- (Rupees Five Hundred only) under erstwhile section 75A of the Act . 10. In appeal, the Commissioner (Appeals) held that the assessee was liable to pay Service tax on the clearing and forwarding service received from their consignment agents during the period 16-10-1998 to 31-8-1999 and as such, demand of Service tax for the said period was upheld. However, demand for the rest of the period was set aside. The amount of penalty imposed under Section 78 of the Act was also reduced to an amount equivalent of Service tax determined by the adjudicating authority for the period 16-10-1998 to 31-8-1999. Further, the penalty amounting to Rs. 500/- imposed under Section 75A was upheld and the penalty amounting to Rs. 1,000/- imposed under Section 77 was set aside. 11. The Tribunal held that when different views are prevalent about the applicability of tax, extended period is not av ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... holding as under : 11. We, therefore, hold that mere procuring or booking orders for the principal by an agent on payment of commission basis would not amount to providing services as clearing and forwarding agent , within the meaning of the definition of that expression under Section 65(25) of the Finance Act, 1994, as has been held in the decision of the Tribunal in Prabhat Zarda Factory (Pvt.) Ltd. v. CCE, Patna reported in 2002 (145) E.L.T. 222 = 2002 (50) R.L.T. 326 (CEGAT-KOL). The decision in Prabhat Zarda Factory (Pvt.) Ltd. stands overruled to the extent of the aforesaid ratio laid down thereunder. The reference is answered accordingly. All these appeals will now be placed before the concerned Division Bench for decision on merits in the light of this judgment and in accordance with law. 15. The Supreme Court in the matter of Jaiprakash Industries Ltd. (supra) held that if there was a divergent view in various cases. There was a bona fide doubt. 16. In Continental Foundation JT. Venture (supra), the Supreme Court held as under : 10. The expression suppression has been used in the proviso to Section 11A of the Act accompanied by very strong words as 'fraud' o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e notice within six months from the date of filing the return. In this case, the return was not filed in respect of consignments from clearing and forwarding agent. Thus, the issue involved herein comes within the purview of Section 73(b) of the Finance Act, 1994. However, there should be an intention to evade tax if certain value of any taxable service was not assessed. 18. In the case on hand, since there were conflicting views, it is a settled principle of law that the same amounts bona fide doubt, and in that event, it cannot be held that there was any intention to evade the tax. Thus, the extended period as provided under Section 73 of the Finance Act, 1994 would not be applicable. 19. In Continental Foundation Jt. Venture (supra), it has been held that there should be a willful suppression of facts with intent to avoid duty. In the facts as aforestated and in the light of several decisions, it is clearly established that in view of the contrary views rendered by the Tribunal in different cases, the case of the assessee comes within the definition of bona fide doubt and in that event, the extended period as provided under Section 73 of the Finance Act, 1994 would not be ap ..... X X X X Extracts X X X X X X X X Extracts X X X X
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