TMI Blog2015 (12) TMI 1061X X X X Extracts X X X X X X X X Extracts X X X X ..... 11.9.2015, and to direct the appellant to deposit a sum of ₹ 5 crores, as pre-deposit towards the service tax, within a period of four weeks from the date of receipt of a copy of this order. The penalty and the interest imposed on the appellant stands waived till the disposal of the appeal - Appeal disposed of. - Civil Miscellaneous Appeal Nos. 2427 and 2428 of 2015, M.P.Nos.1 and 1 of 2015 - - - Dated:- 20-11-2015 - M. Jaichandren And S. Vimala, JJ. For the Appellant : Mr. C. Natarajan, Senior Counsel for Mr. Y. Prakash For the Respondent : Mr. A. P. Srinivas JUDGMENT ( Judgment of the Court was made by M. Jaichandren, J. ) The Civil Miscellaneous Appeal, in C.M.A.No.2427 of 2015, has been filed against the order passed by the Customs, Excise and Service Tax Appellate Tribunal, South Zonal Bench at Chennai, in Misc.Order No.41202/2015, dated 11.9.2015, rejecting the application No.ST/MISC/40613/2015, in ST/40826/2014, filed by the appellant to modify the Miscellaneous Order No.40855/2015, dated 29.5.2015, disposing of an application presented, under Section 35B of the Central Excise Act, 1944, read with Section 86 of the Finance Act, 1994. 2. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the facility of depository, being Citi Bank N.A. The appellant had entered into a depository agreement with Citi Bank N.A., a National Banking Association, organised under the laws of U.S.A., as provided in the underwriting agreement. In terms of the depository agreement, the appellant was to deposit with Citi Bank N.A, the equity shares, at par value of ₹ 2/- per equity share. The agreement had further provided that the said shares would be deposited by the depository, by delivery of shares to the custodian, namely, M/s.Citi Bank N.A., Mumbai. 3.5) During the course of the audit of the accounts of the assessee, conducted by the internal audit party, it was noticed that, as per the annual report like balance sheet, profit and loss account etc., for the year 2007-2008, the paid up share capital had increased by 30 crores due to the allotment of 15 crores on equity shares underlying American Depository Shares, in the month of June, 2007. The said American Depository Shares had been listed and traded in the New York Stock Exchange. It had been noticed that the assessee had incurred share issue expenses of ₹ 175.36 crores, under the Head Expenditure , in foreign currenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... show cause notices, under Section 73(2) of the Finance Act, 1994; 2.I charge interest from M/s.Sterlite Industries India Ltd., Tuticorin, at appropriate rates on the service tax demanded vide Sl.No.(1) above, under Section 75 of the Finance Act, 1994; 3.I impose a penalty of ₹ 200/- per day for every day or 2% of the Service Tax demanded, per month, whichever is higher, on M/s.Sterlite Industries India Ltd., Tuticorin on the Service Tax amount of ₹ 18,64,26,560/-, proposed vide Show Cause Notice dated 11.11.2011 under Section 76 of the Finance Act, 1994, for non payment of service tax on the gross amount received by them for the taxable service received, starting from the first day after the due date of payment till the date of actual payment; 4.I impose a penalty of ₹ 200/- per day for every day starting from the first day after the due date, till the date of actual compliance on M/s.Sterlite Industries India Ltd., Tuticorin, under Section 77 of the Finance Act, 1994 for their failure to register themselves with the Department; and 5.I impose a penalty of ₹ 25,49,32,832/- (Rupees twenty five crores forty nine lacs thirty two thousand ei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eous Order passed by the Customs, Excise and Service Tax Appellate Tribunal, South Zonal Bench, Chennai, dated 29.5.2015 and 11.9.2015, raising the following substantial questions of law: i) Whether the CESTAT could have traversed beyond the scope of dispute before it and made out a new case by holding that Section 66A has to be read independent of the Taxation Services [Provided from Outside India and Received in India] Rules, 2006, even though this is contrary to the Legislative mandate and also the provisions of the Finance Act 1994. ii) Whether, in the facts and circumstances of the case, the orders of the Honourable Tribunal in Misc. Order No.40855/2015 dated 29.5.2015 and the rejection order in Misc. Order No.41202/2015 dated 11.09.2015 is vitiated by error of jurisdiction in so far as requiring a pre-deposit of ₹ 7 Crores of the disputed tax, in as much as the 2nd Respondent Tribunal has traversing beyond the scope of the dispute before it has sought to suggest that since an underwriter located in India providing underwriting services was liable to tax, an underwriter admittedly located outside India ought not to escape liability to tax. iii) Whether, in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stage of the hearing of the appeals, the learned Senior counsel, appearing on behalf of the appellant, had submitted that in view of the facts and circumstances of the case, and in view of the fact that, as per the amendment brought forth during the year, 2014, the appellant may be liable to make a pre-deposit of only 7.5% of the demand. In such circumstances, he had offered that the appellant would deposit a sum of ₹ 5 crores, as pre-deposit, towards the service tax, for the hearing of the appeal before the Customs, Excise and Service Tax Appellate Tribunal. 6. The learned counsel appearing on behalf of the respondent has no serious objection for this court passing such an order. 7. On considering the submissions made by the learned Senior Counsel appearing on behalf of the appellant and in view of the facts and circumstances of the case, we find it appropriate to set aside the orders passed by the Tribunal, on 29.5.2015 and 11.9.2015, and to direct the appellant to deposit a sum of ₹ 5 crores, as pre-deposit towards the service tax, within a period of four weeks from the date of receipt of a copy of this order. The penalty and the interest imposed on the appell ..... X X X X Extracts X X X X X X X X Extracts X X X X
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