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2018 (4) TMI 662

Cenvat credit claim in order, the available Cenvat credit would have proposed for appropriation towards their Service Tax liability. Bench finds that due to non-filing of ST-3 returns at relevant time and non-production of original duty paying document and Cenvat register evidencing availment and debit of Cenvat credit from their Cenvat credit account, the claim of availability of Cenvat credit of ₹ 83,67,707/to them in their Cenvat credit account is not legally tenable. Applicant has himself claimed in their reply that the said amount of Cenvat credit is available to them. They have not stated that the said amount of Cenvat credit was availed and utilized by them. Moreover, the issue regarding determining the admissibility of Cenvat credit to the applicant is not before the Bench, since the said issue has not been raised in the impugned SCN. The applicant by wrongly claiming the said payment has in fact defaulted in making true disclosures of facts. - The claimed CENVAT credit which is neither shown as availed nor utilized in the statutory records like, ST-3 returns/ CENVAT Register and disputed by Revenue, cannot be considered as valid payment towards their Service Tax .....

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ments to ascertain payment of Service Tax made by them. During course of investigation, based on the documents submitted by the assessee, was observed that: RCS were engaged in the business of providing on hire of Hydra Cranes to be used in the construction activities. Their major clients were M/S. L&T, M/S. HCC, M/S. Michigan Engineering, M/S. Pate Engineering, Reliance Industries Ltd. etc.; They were raising bills to their clients based on the work orders on monthly basis and the service tax charged is shown separately, and; They did not file any ST-3 Return, They have not deposited the Service Tax liability to the Govt. Treasury even after collecting the same from their clients. 2.2 Based on Annual Statement of Accounts the Service Tax liability M/S. RCS was worked out, for the period from 2008-09 to 2012-13. 2.3 Based on annual statement of accounts, the service tax liability of M/S. Rajasthan Crane Services was worked out to ₹ 1,88,23,722/- for the period 2008-09 to 2012-13. It is seen that M/S. Rajasthan Crane Services has paid Service Tax for the period 2008-09 amounting to ₹ 18,22,221/- but only paid part of the Service Tax liability amounting to ₹ 25, .....

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essee wilfully suppressed the material facts of providing taxable service receiving consideration for the taxable service provided including service tax and contravened various provisions of law with intention to evade payment of Service Tax and consequently the assessee for their act of commission/omission rendered themselves liable for penalty under Section 76, Section 77 and also Section 78 of the Finance Act, 1994. 2.7 Now therefore, M/S. Rajasthan Crane Services (applicant) was required to show cause to the Commissioner, Service Tax Mumbai-Il as to why: - (a) Service Tax amounting to ₹ 1,88,23,722/- inclusive of education cess and secondary & higher education cess for the period from 2008-09 to 2012-13, should not be demanded and recovered from them in terms of proviso to Section 73(1) of Finance Act, 1994 as amended; and why the Service tax amounting to ₹ 1,03,88,821/paid by the assessee, should not be appropriated towards the Service tax liability as mentioned in this para. (b) Interest on delayed payments of Service Tax for the year from 200809 to 2012-13, should not be demanded and recovered from them under Section 73 of the Finance Act, 1994. Interest amou .....

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the Service Tax and accordingly the applicant started paying Service Tax. Since the applicants are liable to pay Service Tax, the applicant are also eligible to take credit of Service Tax paid on the input services, central excise duty paid on inputs or capital goods in terms of Cenvat Credit Rules 2004. The applicant has been paying Service Tax but there has been delay payment of Service Tax. However, it is a matter of record that while the investgations were started in December, 2011, the applicant started paying Service Tax since about 2009 and has, as on the date the investigations had paid a total amount of ₹ 43,81,564/- towards Service Tax. 3.3 The investigations were started and statements of Shri Bhupendra Sewaram Bhateja, proprietor of the applicant and Shri Achin Bhupender Bhateja authorized representative of the applicant were recorded. During the course the investigations the applicant submitted all the necessary documents relating to the capital goods and the input services for the purpose ascertaining amount of Cenvat credit available to the applicant. The amount of Service Tax actually available was ₹ 83,67,707/-, whereas the applicant as a result of a m .....

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he purpose of construction activities to their clients. Applicant is providing services under the category of 11Supply of Tangible Goods" and that they have admitted and paid their Service Tax liability of ₹ 1,88,23,722/-(Service fax ₹ 1,05,23,636/- + Cenvat credit ₹ 83,67,707 /-) as demanded in the impugned SCN along with applicable interest of ₹ 15,00,361/- and late fees for late filing of returns. The Id. Advocate further pleaded that keeping in the co-operation extended by them during investigation as well as in the proceedings before the Bench; waiver from penalty and prosecution may be granted to them- 6.2 The Bench wanted to know as to why the payment of Service Tax by debiting Cenvat credit was not brought to the knowledge of Revenue during investigation. The Id- Advocate replied that they have filed ST-3 returns late and availment of Cenvat credit is duly mentioned in all returns. The bench, however, directed the applicant to submit all the related services tax payment document and other relevant records to the jurisdictional revenue authorities for verification within three days. Revenue shall verify the correctness/ admissibility of the Cenva .....

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the show cause notice itself, there is no liability/ Service Tax payable for the year 2008-09. The assessee in their application to settlement commission has stated that out of the liability of ₹ 1,88,23,722/-, they have made payment of ₹ 1,05,23,636/- through cash and ₹ 83,67,707/- Cenvat credit. As regards the cash payment, an amount ₹ 103,88,821/- paid by the assessee before investigation and during investigation has been appropriated in the show cause notice itself. However, on verifying the same from ACES, excluding those payment for 2008-09 as deduced from challans and payment for 2013-14 (beyond SCN period), it is seen that the payment ₹ 92,14,700/- only could be verified/ co-related in the absence of detailed worksheet. Further in the absence of month/ quarter wise details of taxable service rendered in the SCN, the value of taxable services shown In the ST-3 returns were tallied with the value shown in the Exhibit-C and the following discrepancies were noticed: Service Tax payable as per Exhibit-C Service Tax payable as per ST-3 Due date Period Date of payment 2,24,729 3,96,916 5-7-2009 April to June, 2009 18-2-2010 2,25,725 3,20,099 5-10-2009 .....

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-52017 submitted a separate copy of the said record to the jurisdictional Service Tax officers. (ii) In their letter dated 9-8-2017 Department called upon them to submit copies of following documents: (i) Cenvat registers for F.Y. 2008-09 to 2012-13 clearly showing all relevant details like vendor name, STC, invoice no., invoice date, service category amount, Service Tax particulars, payment date etc.; (ii) Cenvat credit invoices for the aforesaid period; (iii) Cenvat account debit proof for Service Tax payment; (iv) Interest and Service Tax payment proof along with relevant challans. (iii) Out of the above said documents, our clients have already submitted documents mentioned at Sr. Nos. (ii), (iii) & (iv). As regards the Cenvat it is contention of our clients that since the Chartered Accountant who was dealing with the matter and was maintaining the said account is not available as he is travelling abroad and, therefore, our clients are not in a position to submit the same. (iv) Subsequently, our clients also received a letter dated 20-6-2017, which a Report dated 19-6-2017 submitted by the Commissioner to the Hon'ble Settlement Commission was enclosed. In the said interi .....

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ble as credit in relation to the inputs and an amount of ₹ 4,24,080/- is available as credit in respect of the capital goods procured. Similarly, in the year 2010-11 while an amount of ₹ 2,75,860/- is available in respect of the inputs, an amount of ₹ 22,12,670/- is available in relation to the capital goods. For the financial year 2011-12, an amount of ₹ 7,74,782/- is available as credit in relation to inputs while an amount of ₹ 29,38,717/- is available towards capital goods. In the year 2012-13 while there is no credit available in relation to capital goods, the Cenvat credit available in relation to the inputs is ₹ 17,24,872/-. The total amount of Cenvat credit available in respect of inputs during the years 2009-10 to 2012-13 is ₹ 23,10,275/- whereas the total amount of Cenvat credit available in respect of the capital goods amounts to ₹ 55,75,467/-. Thus, the total credit available these y-ears is ₹ 83,85,741 / -. (vi) As regards the purported discrepancy or difference in the total amount of Service Tax paid through cash, we request you to kindly refer to the chart available at pages 2 to 4 of the application along with th .....

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amp;T, M/s. HCC, M/S. Michigen Engineering, M/s. patel engineering, M/s. reliance industries etc. They were raising bills to clients on work orders on monthly basis and the Service Tax charged were shown separately, they did not file any ST-3 Returns and also failed to deposit service tax to the government after collecting the same from their clients. The detailed investigation culminated in the issue of SCN dated 19-10- 2013 where under Service Tax of ₹ 1,88,23,722/- was demanded. Applicant has filed impugned application for settlement of their case pertaining to said SC" dated 19-10-2013 8.2 Applicant has contended that they had declared value of service provided by them, in their books of accounts and they were paying Service Tax since 2009 though there was delay on their part in payment of Service Tax. They have filed ST-3 returns for the period 2009 on wards on 20-10-2013 and also pas: Service Tax and interest before issue of SCN. They claimed to have paid service Tax of ₹ 1,05,23,636/- by way of cash deposit and ₹ 83,67,707/- by way of debit in cenvat credit account. They have requested for immunity from penalty and prosecution considering the above sai .....

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tter dated 30-6-2017 made an excuse that all the copies of invoices and challans were already submitted along with settlement application. Applicant also contended that they, however, supplied copy of the said documents to jurisdictional Service Tax officers. The applicant further admitted that they could not submit Cenvat registers for the year 2008-09 to 2012-13. Applicant also pointed out that during investigation Cenvat records were verified and no discrepancy pointed out by Revenue and therefore, they are eligible for the said Cenvat credit. In this regard, Bench finds that the applicant did not file statutory ST-3 returns at the relevant time. They collected Service Tax from their client but did not pay the same to the Government. The Bench notes that in this case neither the ST-3 returns were filed at the relevant time nor the applicant produced the Cenvat credit register evidencing availment and debit of Cenvat credit. It is also noticed that no original invoices were produced by the applicant before Revenue authorities. Despite specific directions from this Bench to produce original records for verification before Revenue, they are still claiming that copies of invoices ar .....

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