TMI Blog2014 (5) TMI 918X X X X Extracts X X X X X X X X Extracts X X X X ..... B to the show cause notice, total amount of security services as also the service tax collected has been shown. Both the figures are based upon the respondents own invoices issued to various clients and recovered during the visit of the Central Excise officials. In respect of the service tax amount charged and collected, we do not see any reason why the said amount should not be paid to the Government account - Commissioner (Appeals) has fallen into error in taking certain figures (year wise or consolidated for the total period) instead of examining invoice wise/transaction wise details. - Duty, interest and penalties u/s 76 & 78 are confirmed against assessee - Decided in favour of Revenue. Valuation - Deduction on account of bad debts - Held that:- It is not clear how much of these bad debts were pertaining to taxable service and how much were pertaining to labour service/non-taxable service. It is also not very clear that these bad debts were pertaining to which period i.e. for the period prior to 16.10.1998 or the later. We, therefore, direct the respondents to give the details of the bad debts invoice-wise, i.e the respondents should inform the authorities invoice-wise (a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e tax collected Rs.7,39,696/-. During investigation, in addition, following were observed:- (1) In respect of certain transactions, parallel invoices were recovered. In one set, the service was mentioned as security service while in other invoice, though the amount charged, service receiver, number, amount were same, the service indicated was labour service. (2) Shri S.N. Rai, proprietor, after seeing certain parallel invoices, accepted that they have raised bills for labour services, even though the service provided was security services and this was done as per the request of their client. Shri Rai also admitted that they have adopted this method in respect of many clients, i.e. in addition to the invoices recovered. (3) Shri Dilip D. Gaurav, personnel officer, in his statement, admitted that the exact nature of service provided by them is security service only. (4) In respect of certain clients, it was seen that for certain period, the invoices were for security service and for subsequent period, the invoices were for labour service and thereafter again for security service, even though agreements with such clients were for security services. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dents relating to labour services, dues collection charges, security charges on movable property and bad debts. (It was also noticed that the amounts claimed against the said items were different that what was claimed before the original authority.) The Commissioner (Appeals) after giving the benefit of the said amounts, partially allowed the appeals of the respondents. Further, the penalty proposed for delay in registration was set aside. However, the penalties under Sections 76 and 77 of the Finance Act were upheld and penalty under Section 78 was reduced to the duty amount confirmed by the Commissioner (Appeals). 5. The main argument of the learned AR appearing on behalf of the Revenue is that if we go through Annexure B to the show cause notice, it would be clear that substantial portion of the demand consists of the amount which has been charged and collected by the respondents. This is clear from the list and other details given in Annexure B. The learned AR further argued that in respect of the services provided to the so called movable property, Notification No. 56/98-ST is not applicable. The said Notification is applicable only to safe deposit vaults. Moreover, the sai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted before the adjudicating authority and those submitted before the Commissioner (Appeals). Thus, these figures have been provided as an afterthought and are unsubstantiated and no benefit can be extended to the respondents on the basis of such figures. This is especially true when considered with the fact that parallel invoices were recovered from the respondents' premises and the proprietor has agreed in his statement to issuance of labour invoices in place of security service invoices and statement of Personnel Officer in which he has stated that only security services were being provided. It is further submitted that Notification No. 56/98 provides exemption only to services of providing safe deposit lockers or security of safe vaults. Thus, the benefit cannot be given for movement of cash in vans and security of jewellery etc. 5.4 The learned AR further submitted that during the search, in respect of respondent No.1, the value of security bills and labour bills found are as under: Year Security Bills Labour Bills 1998-99 53,92,933 - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Annexure B. We find that the respondents have not questioned any details given in respect of various invoices and details of Annexure B. We also observe that instead of explaining invoice-wise details, the respondents have chosen to give certain figures year wise or consolidated for all the years. We also observe from para 5.2 above that the quantums given before original authority and first appellate authority varies widely. Thus the figures given by the respondents do not appear to inspire any confidence. In any case, service tax is collected invoice-wise and is required to be deposited on the basis of total collection in a month/quarter. We also observe that in Annexure B to the show cause notice, total amount of security services as also the service tax collected has been shown. Both the figures are based upon the respondents own invoices issued to various clients and recovered during the visit of the Central Excise officials. In respect of the service tax amount charged and collected, we do not see any reason why the said amount should not be paid to the Government account. We observe that during the period 16.10.1998 to September 2002 in respect of Globe Pvt. Detective Bure ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also the copy of supporting agreement/contract with their client. The original authority will thereafter examine the respondents' claim in respect of each invoice whether the same is covered by Notification 56/98-ST or not. Wherever claim is found to be correct, Revenue will extend the benefit in the total amount demanded. Needless to say that decision will be taken after granting an opportunity of personal hearing to the respondents. 10. As far as invoices relating to labour services are concerned, we find considerable force in the argument of the learned AR that during 1998-99, the amount towards labour services was zero, which substantially increased during 1999-2000 and 2000-2001 and during the subsequent period, the said amount became ten times and the income from security services decreased in spite of the fact that the respondents' main area was security services. We also note that the proprietor had admitted that they have issued invoices for labour services while providing security services. Shri Dilip D. Gaurav, Personnel Officer of the respondents, has admitted that they were providing only security services. We also note that parallel set of invoices were re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er Sections 76 and 78 are imposable. Penalty under Section 77 is also imposable. 14. We may like to mention that the Commissioner (Appeals) has fallen into error in taking certain figures (year wise or consolidated for the total period) instead of examining invoice wise/transaction wise details. In somewhat similar circumstances (though relating to central sales-tax) in the case of Tata Engineering and Locomotive Co. Ltd. vs. Assistant Commissioner of Commercial Taxes, and another reported in 1970 (1) SCC 622, the Hon'ble Supreme Court has observed as under:- 12. Another serious infirmity in the order of the Assistant Commissioner was (a matter which even the Advocate General quite fairly had to concede) that instead of looking into each transaction in order to find out whether a completed contract of sale had taken place which could be brought to tax only if the movement of vehicles from Jamshedpur had been occasioned under a convenant or incident of that contract the Assistant Commissioner based his order on mere generalities. It has been suggested that all the transactions were of similar nature and the appellant's representative had himself submitte ..... X X X X Extracts X X X X X X X X Extracts X X X X
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