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2015 (8) TMI 504 - CESTAT MUMBAI

2015 (8) TMI 504 - CESTAT MUMBAI - 2015 (40) S.T.R. 158 (Tri. - Mumbai) - Demand of service tax - appellant is engaged in providing security services and also other services like cleaning services, services to SEZ units and some non-taxable services - difference in gross value of taxable service as shown in ST-3 returns, as compared to turnover as per Books of Account. - held that:- Other than security services, the appellant also provided services like caretaking services, driving services, loa .....

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classification, it is settled law that classification of taxable service must be specified in the show-cause notice in order to fasten liability of Service Tax. - appellant is not liable to Service Tax in respect of the non-taxable services, the gross value of which totals ₹ 40,00,09,350/- and accordingly, the demand of ₹ 4,12,00,963/- is set aside.

In respect of 'cleaning services', the same have been provided by the appellant to various organizations including Govt. Hos .....

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set aside.

Even in the earlier period out of 7 SEZ units (under dispute) except Punj Lloyd and Glenmark Pharma, services have been provided to these SEZ units and based on the certificate from the Chartered accountant, exemption was allowed to the appellant. In the present case also, the certificate of chartered Accountant is available on record and the same was filed before the adjudicating authority also, which is evident from the impugned order. The certificate certifies that the .....

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ischarge Service Tax was shifted from the receipt basis to accrual basis. It is evident that the liability on accrual basis has been discharged, on the difference in the value of the services for the prior period also and therefore, the same were not included in the gross value, determined for ST-3 returns for 2011-12.

So far the issue of 'reimbursement of expenses' which have been taxed, it is seen that the appellant have voluntarily deposited ₹ 31,37,207/- out of the total dem .....

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the value of service shall be considered as inclusive of Service Tax. - Decided in favour of assessee. - Appeal No. ST/89442/14 - Final Order No. A/1824/2015-WZB/(STB) - Dated:- 30-6-2015 - Anil Choudhay, Member (J) And P. S. Pruthi, Member (T),JJ. For the Appellant : Shri Prasad Paranjape, Adv. For the Respondent : Shri D Nagvenkar, Addl. Commissioner (AR) ORDER Per: Anil Choudhary: The appellant assessee is in appeal being aggrieved by the Order-in-Original No. 52/ST-II/RS/2014 dated 28.7.201 .....

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eaning services, driver services, telephone operator services and certain other house-keeping services. The Revenue observed difference in gross value of taxable service as shown in ST-3 returns, as compared to turnover as per Books of Account. 3. A show-cause notice dated 21.12.2012 was issued for the period 2011-12 and pursuant to adjudication, being the present impugned order, the following issues are involved as shown in the table below:- Sr. No Issue Value of Service (Rs.) Service Tax Deman .....

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was directed to be appropriated. Further, penalty under Section 78 is imposed at ₹ 8,29,95,022/- and ₹ 10,000/- under Section 77 of the Act. 4. It is urged by the appellant that the issue involved in the present appeal at Sr. No. 1, 2 & 3 are similar as in the prior period April, 2008 to March, 2011 and are covered by the order of this Tribunal in the appellant's own case being final order No. 550-557 dated 11.4.2014 - in respect of the earlier Order-in-Original No. 35-37/ST .....

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ice Tax admitting the liability on the following services before issue of show-cause notice as follows:- Sr. No Nature of Services Value (in Rs.) Service Tax (in Rs.) 1 Cleaning services provided to Chartiable Hospitals. 24,42,054 2,51,532 2 Cleaning services to private Hospitals 28,08,403 2,89,266 3 Cleaning services to Education Institutions runs by Charitable Trusts 1,10,31,788 11,36,274 4 Cleaning service to private Educational Institutions 33,22,458 3,43,213 5 Reimbursement of Expenses 3,04 .....

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rt of their claim. Right from the beginning, the appellant had claimed that the issue in the present period are identical to the issue raised in the earlier show-cause notice (prior period) which formed part of the Order-in-Original dated 12.11.2012. In such circumstances, the appellant had requested the authority to await the decision of the Tribunal in the earlier cross appeals preferred by the Revenue and assessee against the said Order-in-Original dated 12.11.2012. Further, the replies furni .....

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to SEZ units and cleaning services provided to SEZ units and cleaning services provided to non-commercial organizations(s). The demands with respect to the exempted services or non-taxable services were dropped in the earlier show-cause notice. (emphasis supplied) However, while dealing with the present show-cause notice, the learned Commissioner has ignored the factual details/aspects and has brushed aside the submission holding that in the present show-cause notice specific amount to be paid h .....

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this tribunal dated 11.4.2014 is of no help to the appellant. Further, the reply submitted by the appellant has been detailed in toto, but there is no reference to the letter No. BIS/MU/HO/80 dated 14.4.2013 submitted by the appellant. If this letter would have been considered, the impugned demand would not have been raised. (emphasis supplied) The learned Commissioner further relies on the findings recorded in the earlier Order-in-Original dated 12.11.2012 which is quoted herein below for read .....

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ervices provided duly certified by the Chartered Accountant. Annexure-II of reply dated 20.10.2012 containing the details of Security Agency Services provided to SEZ Developers Units during the period 01.10.2008 to 31.03.2009 and 2009-10 to 2010-11. The show-cause notice proposed to deny the exemption under Notification No. 4/2004-ST and Notification No. 9/2009-ST in respect of the services provided by the noticee reportedly in SEZ Developers/Units primarily on the ground that the assessee did n .....

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red Accountant. The notice declared the claim of exemption in the ST-3 returns filed for the period April 2007 to March 2009. It is the contention of the notice that they have availed the exemption correctly, declared the availment of exemption in their ST-3 returns filed for the period April, 2007 to March, 2009 and also submitted necessary evidences to support their claim. In view of the fact that certificates evidencing approval of SEZ developers/SEZ units have been submitted along with Chart .....

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s supplied) 5.2 Thus, the impugned order in cryptic and in gross violation of principles of natural justice. Further, the impugned order has been passed without providing adequate opportunity of hearing. Although, the adjudication proceedings were kept pending, yet no opportunity of hearing was given after passing o final order by this Tribunal dated 11.4.2014, resulting into mis-carriage of justice. It is further urged that vide the present impugned order, the learned Commissioner has re-opened .....

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t impugned order is also flawed on the ground that the issue in the earlier appeal and the present appeal arose out of the same Audit report and thus the impugned order is fit to be set aside. 5.3 So far the issue of security services to ONGC and the disclosure of turnover in ST-3 returns, the disclosures of exemption notification, production of SEZ certificates and on suppression of facts, it have already been held in the earlier Order-in-Original dated 12.11.2012 that there is no suppression o .....

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as rejected the claim with the observation that A2 certificate have only been produced in the case where the appellant had not submitted A1 certificate and where the appellant has submitted A1 certificate, it has been observed that only declaration in A1 has been given. These certificates are undoubtedly for the purpose of availing the exemption by the SEZ units and accordingly there can be no dispute as to the fact of existence of the SEZ unit in question. Further, the question of submitting A2 .....

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mp; 21 of the impugned order. It is further urged that the impugned order is contrary to the provisions of Section 73(3) of the Finance Act, 1994. The bare reading of the provisions reveals that if the assessee have paid the tax amount, which has not been levied or paid or has been short levied or short paid on the basis of its own ascertainment before issue of show-cause notice, under sub-section (1) of Section 73 informed about such payment in writing, no show-cause notice for the said amount .....

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ed issue. Hence, the impugned order is fit to be set aside on this count also. 5.6 It is further urged that the allegation of suppression of facts and mala fide intention with intent to evade payment of tax is not sustainable in view of the fact that proper disclosure have been made in the ST-3 returns which have been taken notice in the earlier Order-in-Original dated 12.11.2012, in para 5.3 of the order as follows:- "As the amount determined and confirmed as payable at Sr. No. 5.1 above d .....

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0 of the Finance Act, 1994, and having regard to the facts and circumstances of the case, I do not impose any penalty on M/s Bombay Intelligence Security (India) Ltd, Mumbai - 86 under Section 76 and Section 77 as M/s Bombay Intelligence Security (India) Ltd., Mumbai - 86, have proved that there was reasonable cause for the said failure." It is vehemently further urged that no ground for imposition of penalty is made out and the penalty imposed is fit to be set aside. 6. The learned AR subm .....

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Glenmark Pharma. Hence, the benefit is not allowable. Further, the point of taxation issue is new one as per the change in the provisions of law, tax is payable for the current period on accrual basis. However, the appellant have paid the tax on receipt basis. Thus, the appellant is required to pay the differential amount as demanded in the impugned order. Further, for quantification, the matter can be remanded to the court below. 7. Having considered the rival submissions and the written submis .....

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es. As per certificate of the C.a. produced by the appellant before the court below as well as this Tribunal, the total value of such services is ₹ 40,00,99,350/- for the disputed period. The learned C.A. has certified that the figure of turn over is correct as per the Books of account maintained. It is further seen that no specific head of service category has been proposed in the show-cause notice nor confirmed in the impugned order. Thus, the show-cause notice as well as the impugned or .....

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at length. The issue stands concluded as earlier order of Tribunal has been accepted by the Revenue. Thus, it is held that the appellant is not liable to Service Tax in respect of the non-taxable services mentioned herein above, the gross value of which totals ₹ 40,00,09,350/- and accordingly, the demand of ₹ 4,12,00,963/- is set aside. 7.2 In respect of 'cleaning services', the same have been provided by the appellant to various organizations including Govt. Hospitals, Govt. .....

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ly excluded. We also take notice of the fact that in the earlier Order-in-Original dated 12.11.2012 for the prior period, the adjudicating authority has confirmed demand only in respect of cleaning services provided to Private Educational Institution and Private Hospital. Further, the demand with respect to cleaning services provided to Govt. organizations, Agriculture, Horticulture was dropped, being not taxable. It is further noticed that the appellant have paid Service Tax suo motu even befor .....

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ed 12.11.2012, the adjudicating authority have considered the gross value as inclusive of Service Tax and have dropped the demand with respect to cleaning services provided to Govt. organizations, Agriculture, Horticulture etc. Thus, we hold that the demand of ₹ 2,94,55,469/- towards cleaning services is erroneous and is accordingly set aside. The admitted liability of tax, is the actual liability of ₹ 20,90,285/-, have already been discharged before issue of show-cause notice. 7.3 S .....

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against the appellant. In the course of hearing, the learned Counsel for the appellant produced the prescribed form along with the approval from the Approval Committee in respect of the SEZ units save and except one M/s Punj Lloyd Ltd. We also take notice that even in the earlier period out of 7 SEZ units (under dispute) except Punj Lloyd and Glenmark Pharma, services have been provided to these SEZ units and based on the certificate from the Chartered accountant, exemption was allowed to the a .....

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0,68,290/- attributable on this account is set aside. 7.4 So far the issue of difference in value of services as per ST-3 returns and balance-sheet due to introduction in point of Taxation Rules, 2011 w.e.f. 1.4.2011, the liability to discharge Service Tax was shifted from the receipt basis to accrual basis. It is evident that the liability on accrual basis has been discharged, on the difference in the value of the services for the prior period also and therefore, the same were not included in t .....

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