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Mr. Parmesh Sharma Versus C.S.T., Delhi

2015 (10) TMI 57 - CESTAT NEW DELHI

Waiver of pre deposit - Demand of service tax - Interest u/s 75 - Penalty u/s 77 & 78 - Business Auxiliary Service - Held that:- Concept of revenue neutrality pleaded in the above illustrative transaction to be creative and attractive at first blush but wholly unacceptable as a normative principle. Entitlement to credit is predicated on the basis of such a facility provided under CENVAT Credit Rules, 2004. These Rules constitute a policy choice of the State. The entitlement of LICHFL to avail CE .....

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ve on application of the concept of revenue neutrality as a clog on the liability to service tax. - none warrant to apply this concept to legitimise an inference of immunity to tax of the appellant even for the normal period of limitation. Since the Interim Orders referred to above have applied the concept of revenue neutrality to grant waiver of pre-deposit, for the nonce we follow those decisions in respect of the extended period and the liability of the appellant for extended period but not f .....

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Delhi-I. The impugned order partly allowed the appeal to the extent of granting cum tax benefit and providing an option of remitting 25% of the assessed penalty provided appellant remits the assessed service tax and interest payable within 30 days from the date of communication of the quantum of service tax assessed and the interest thereon. The primary adjudication order confirmed service tax demand of ₹ 7,18,922/- apart from interest under Section 75 and penalties under Sections 77 and .....

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the firm view that it is not liable to service tax since LICHFL is remitting service tax and therefore on the principles of revenue neutrality, there is no liability for the appellant to remit service tax. Notwithstanding such self-certification of immunity to tax by the appellant, Revenue initiated proceedings culminating in the primary adjudication order, which was substantially confirmed by the impugned appellate order. 3. Shri AK Batra, ld. consultant for the appellant strenuously contended .....

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(Tri.-Del.); PTL Enterprises Ltd. Vs. CCE, Cochin [2013 (30) STR 525 (Tri. - Bang.)]; M/s. Fertiplant Engg. Co. Pvt. Ltd. Vs. CCE, Raigad [2013-TIOL-748-CESTAT-MUM];Nhava Sheva International Container Terminal Pvt. Ltd. Vs. CCE, Raigad [2011 (24) STR 706 (Tri.-Mumbai)]; A.P. Enterprises Vs. CST, Chennai [2008 (12) STR 585 (Tri.-Chennai)]; Daman Ganga Board Mills Pvt. Ltd. Vs. CCE, Daman Vapi [2012 (276) ELT 532 (Tri.-Ahmd.)] for the proposition that in case of revenue neutrality, a prima facie, .....

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evenue neutrality pleaded in the present case arises as follows. The appellant provided BAS to LICHFL. It is thus admittedly liable to remit service tax for having provided BAS. Since service tax is an indirect tax, the appellant is entitled to recover the component of the service tax suffered by it from the service recipient, LICHFL. LICHFL is consequently entitled to take credit of the service tax reimbursed by that entity to the appellant while remitting its liability to service tax for havin .....

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the appellant. Consequently, revenue neutrality results, according to the appellant. 6. We find the concept of revenue neutrality pleaded in the above illustrative transaction to be creative and attractive at first blush but wholly unacceptable as a normative principle. Entitlement to credit is predicated on the basis of such a facility provided under CENVAT Credit Rules, 2004. These Rules constitute a policy choice of the State. The entitlement of LICHFL to avail CENVAT credit depends upon pro .....

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