TMI Blog2016 (11) TMI 1291X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant-assessee. - APPEAL NO: ST/86000/2015 - ORDER NO:A/93128/16/STB - Dated:- 13-4-2016 - Shri M V Ravindran, Member (Judicial) And Shri C J Mathew, Member (Technical Shri V. Sridharan, Sr. Advocate with Shri S.S. Gupta, Chartered Accountant for the appellant Shri V.K. Singh, Special (AR) for the respondent Per: C J Mathew: Appellant, M/s HDFC Standard Life Insurance Company Ltd, registered as per rule 4 of Service Tax Rules, 1994 as provider of a number of services, operates through a number of agents and are registered as assessee for discharge of tax on insurance auxiliary service under section 65 (105) (zy) of Finance Act, 1994 in accordance with the definition of erson liable to pay tax in rule 2 of Service Tax Rules, 1994; the present dispute before us is on the demand of the amount of that tax which has, allegedly, been recovered by the appellant from the agents. Service tax authorities, pointing to the particular clause in the agreements of the appellants with their agents, proceeded on the premise that such reimbursements were collection of tax in excess that, under section 73A of Finance Act, 1994, is required to be credited to the Central ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent of payment of service tax. 20.4 The above provisions indicate that M/s HDFCSLICL is not supposed to collect any amount of service tax from the provider of service, namely, the insurance agent and if they do so, to that extent they are not eligible for availing CENVAT Credit also. Looked from either perspective of CDENVAT Credit Rules or from the perspective of service tax Credit (sic) Rules, the recipient of service is required to deposit the service tax if he has collected any amount from any person which he is not required to collect. The collection of amount of service tax from the provider of service by the recipient would negate the very principle of indirect taxation where the provider of service collects the tax from the recipient of service and pays to the government i.e. the incidence of tax is passed on to the recipient of service by the provider of service. Therefore, the provisions of Section 73 A(2) should cover the situation involved in the current case where the recipient has, instead of paying the service tax from his own pocket has recover4ed a part of the amount from the provider of service representing as service tax. Therefore, he is required to deposit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d govern indirect taxation but such principles can neither substitute for nor govern interpretation of the taxing provision. Tax can be collected only in accordance with the law and it is that law which must be invoked in effecting recovery. 5. It is the contention of Mr V Sridharan, learned Senior Advocate, that the adjudicating authority has erred in invoking section 73A (2) of Finance Act, 1994 for, according to him, the first and second sub-rules are mutually exclusive in so far as the objects of their respective attentions are concerned. With the obligation in the first sub-rule restricted to a person liable to pay service tax and such liability to be fastened upon the persons so described in the Chapter, or any Rules made thereunder, an obligation in another sub-rule of the same provision covering any person cannot have been intended by the sovereign legislature to apply to the specified person in the first sub-rule. This proposition cannot but be considered favourably, and particularly, in the context of the observation of the adjudicating Commissioner that a parallel provision is not found in section 11D of the Central Excise Act, 1944. Considering the peculiarity of ser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... recovery in the impugned order. 8. Learned Senior Advocate drew our attention to the pellucid meaning and purpose of section 11D of Central Excise Act, 1944 assigned by their Lordships in Mafatlal Industries Ltd v. Union of India [1997 (89) ELT 247 (SC)] thus: 97. It was contended by the learned counsel for the appellants-petitioners that Section 11D provides for double taxation. It was contended that sub-section (1) of Section 11D makes the manufacturer liable to pay duty which he collects from the buyer as part of the price of goods even where the manufacturer has already paid the duty at the time of removal. We do not think that there is any foundation for the said understanding or apprehension. There are no words in the section which provide for payment of duty twice over. All that the section says is this : the amount collected by a person/manufacturer from the buyer of goods as representing duty of excise shall be paid over to the State; even if the tax collected by the manufacturer from his purchaser is more than the duty due according to law, the whole amount collected as duty has to be paid over to the State; if on the assessment being made it is found that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... overnment has application only when equivalent duty had not been deposited at the time of removal of the goods. The scheme of the law is that manufacturers shall not collect amounts falsely representing them as central excise duty and retain them, thus, unjustly, benefiting themselves. In the present cases, (irrespective of whether the 8% payments were duty or not) since the 8% amount remain already paid to the revenue, and no amount is retained by the assessee, Section 11D has no application. 9. In service tax levy, too, the person liable to pay the tax is required to deposit the tax amount irrespective of the quantum or stage of recovery from the person who bears the burden of tax. There is a distinct dichotomy, in both Central Excise Act, 1944 and Finance Act, 1994, of the obligation to credit the tax with Central Government and the recovery of the amount from the other person. And that is a dichotomy that does not brook any latitude whatsoever and its acceptance by Revenue is amply evidenced by circular no. 870/8/2008-CX dated 16 th May 2008 which clarifies that section 11D of Central Excise Act, 1944 is not liable to be invoked even if the mandated payment for availing ..... X X X X Extracts X X X X X X X X Extracts X X X X
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