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Competent Automobiles Co. Ltd. Versus Commissioner of Service Tax

2017 (3) TMI 376 - DELHI HIGH COURT

Business Auxiliary Services - receipt of commission - deposit of service tax by the recipient of services i.e. MUL - authorized dealer selling cars on behalf of MUL - Held that: - The service tax liabilities discharged by MUL/MSIL would refer to the amounts constituting the proportion of the commission it retains and discloses as the consideration/service received, for which tax is to be paid. There is no positive assertion that the amount or the portion of the commission, which is apparently of .....

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- MR. S. RAVINDRA BHAT MR. NAJMI WAZIRI JJ. Petitioner Through: Sh. S.C. Ladi, Sr. Advocate with Sh. Rajesh Jain and Sh. Virag Tiwari, Advocates. Respondent Through: Sh. Sanjeev Narula, CGSC. MR. S. RAVINDRA BHAT 1. The petitioner in these writ proceedings seeks an order for quashing of summons, requiring it to appear and produce documents in connection with the service tax demands outstanding against it. 2. The brief facts of the case are that the petitioner is an authorized dealer inter alia o .....

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Tax on 21.12.2006 and proceedings were initiated for non-payment of tax for the period February 2004 to March 2006. After considering the submissions of the petitioner, the Commissioner of Sales Tax took note of the legislative changes brought about by amendment with effect from 10.09.2004 to the Finance Act, 1994 and determined the demand at ₹ 1,56,48,080.91/- together with interest and appropriated a sum of ₹ 1,24,65,694.27/- which had been deposited during the pendency of the proc .....

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e Tribunal ( CESTAT ). This was, however, dismissed by CESTAT on the ground of inordinate delay (of 1916 days), which the tribunal refused to condone. The petitioner, who filed W.P.(C) 8089/2012, challenged that order - dated 29.01.2014 before this Court. The Court found no ground to interfere with the CESTAT s order and accordingly rejected the writ petition. 4. In these circumstances, the petitioner, on 04.09.2014, moved what it claimed was a rectification application in which it was stated in .....

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s depositing the applicable service tax. Evidence of deposit of this amount in the form of TR-6 have already been placed on record. Collection of service tax from the applicant when the same stood by Maruti Udyog Ltd. would not only be violative of Article 265 of the Constitution of India but would also be an unjust enrichment to the department. 9. Coming back to the order dated 21.12.2012 passed by the Hon ble High Court in Writ Petition No.8089 of 2014, the applicant would request your good se .....

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he principal ground urged is that for the relevant period, the service tax demanded, i.e. in respect of the amount of ₹ 31,83,356/-, service tax had been deposited by MUL. 6. Learned counsel for the petitioner contends that the respondents inaction and deliberate refusal to verify and cross-check its assertions that for the concerned period, service tax in fact had been deposited by MUL, is arbitrary. In this regard, learned counsel relies upon the certificate of MUL/Maruti Finance and T.R .....

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09.2004, (as against the total amount as commission of ₹ 1,44,37,72,022.84/-), the service tax paid was ₹ 11,55,01,761.83/-. The latter further states that MSIL shared the commission with its various dealers, including the petitioner. The counsel relies upon the following extract of the letter: Certificate Date:- 15.2.2017 To M/s. Competent Automobiles Co. Ltd., Competent House, F-14, Connaught Place, New Delhi 110 001 1. XXXXXX XXXXXX XXXXXX 2. Maruti Suzuki India Ltd. (formerly kno .....

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Business Auxiliary Services covered u/s 65(19) of the Finance Act, 1994. 3. The total amount received by MSIL from the finance companies as commission up to 9.9.2004 was ₹ 1,44,37,72,022.84/- on which service tax paid by MSIL was ₹ 11,55,01,761.83/-. 4. Out of this amount, MSIL shared the commission with its various dealers including your company. 5. During the period February, 2004 to August 2004, out of the commission received, we paid the following amounts to you:- S.No. Dealer C .....

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id amount of ₹ 3,97,79,834.45/- paid to M/s. Competent Automobiles Co. Ltd. formed part of the total amount of ₹ 1,44,37,72,022.84/- received by MSIL on which MSIL paid the service tax of ₹ 11,55,01,761.83/-. The said payment of service tax by MSIL was only against the commission received towards marketing & selling of auto retail loans of the Finance Companies. The above service tax was paid to the Service Tax Department and has not been claimed as refund by MSIL. For Maru .....

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s gross abuse of the process of Court. Highlighting that the petitioner s previous two writ petitions were not entertained, firstly on account of availability of alternative remedy and the second one due to the dismissal of its appeal, it is argued that the devious manner of seeking relief that is forbidden by law, adopted in this case, is to style a representation as a rectification of a final order. The petitioner had availed of all possible opportunities to contend that it had complied with, .....

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ground of delay. 9. Counsel contends that the petitioner s attempt to have the matter reexamined on merits failed with the dismissal of its second writ petition before this Court. In these circumstances, the method adopted to contend that the service tax liability (in respect of which it had all the opportunity to say that demands were satisfied) cannot be enforced, is untenable. Learned counsel submitted that what cannot be achieved directly cannot be achieved indirectly. It was also urged tha .....

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ed in the absence of any material or admission which shows that ₹ 31.82 lakhs was ever received by the service tax department. 10. From the narrative, it is apparent that this is the third writ petition in sequence as it were for the same relief. On the first occasion, the petitioner had approached this Court, aggrieved by the demands made pursuant to the orders-in-original. That order-in-original had attained finality in 2007 itself. The petitioner claimed to be aggrieved by a demand date .....

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ise and Service Tax Appellate Tribunal, whereby the petitioner s application for condonation of delay being condonation application No. 57231/2013 in the Service Tax Appeal No. 56682/2013 was dismissed on the ground of there being no satisfactory explanation for condoning the delay. The fact of the matter is that the adjudication order was passed on 27.09.2007. The normal period during which the appeal could have been filed was three months. The appeal was actually filed on 03.04.2013 which ipso .....

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or illegal. We do not find any illegality in the impugned order. The writ petition is dismissed. 11. In the above circumstances, for the first time, the petitioner asserted in reply to the demand made pursuant to the outstanding amounts payable that MUL had already deposited the relevant amount. In alleged proof of this assertion, a certificate, dated 27.05.2009 by MSIL was relied upon. This certificate was sought to be used in answer to a demand by the Superintendent, Service Tax dated 18.02.20 .....

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