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TMI Blog2018 (6) TMI 1162X X X X Extracts X X X X X X X X Extracts X X X X ..... s delivered by R. Subramanian, J. ) The appellant challenges the dismissal of the Writ Petition in WP. No.859 of 2015 dated 18.12.2015, by way of this Intra Court Appeal. 2. Challenge in the Writ Petition was to the order of the 4th respondent, in and by which, the 4th respondent rejected the benefit of Voluntary Compliance of Excise and Service Tax Scheme to the appellant. The said rejection came to be made in the backdrop of the following facts. 3. The appellant had registered itself as a service provider liable to pay service tax for accommodation service and restaurant service. While so, a physical audit came to be conducted on 25.02.2013 and 28.02.2013 during the course of the said audit, the officers of the Central Excise Departmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate. It was also contended that the provision of renting of immovable property service was unearthed during the course of audit and therefore, the appellant would not be entitled to the benefits of VCES Scheme, in view of the provisions of Section 106 (2)(b) of the Finance Act, 2013. 6. On the interpretation of the provisions of Section 106(2) of Finance Act, 2013, the learned Single Judge concluded that the appellant is not entitled to the benefits of the scheme and the order of rejection passed by the Authority was thus upheld. Aggrieved the appellant is before us by way of this Intra Court Appeal. 7. We have heard Mr.M.K.Kabir, learned Senior Counsel appearing for the appellant and Mr.V.Sundareswaran, learned Senior Panel Counsel appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... )(b) applies to a person against whom an audit has been initiated. The later part of Section 106(2) provides that if such inquiry investigation contemplated under Section 106(2)(a) or the audit contemplated under Section 106(2)(b) is pending as on 01.03.2013, the Designated Authority shall by an order and for reasons to be recorded in writing reject such declaration. 10. Mr.M.K.Kabir, learned Senior Counsel appearing for the appellant would draw our attention to certain clarifications issued by the department on 25.11.2013 with reference to the applicability of the provisions of Section 106(2) and contend that inquiry or investigation or audit referred to under Section 106(2)(a) and (b) should be with reference to the service provided by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 01.03.2013 and therefore, the appellants declaration under VCES Scheme was liable to be rejected in terms of Section 106(2) of Finance Act, 2013. 13. We have considered the rival submissions. Mr.M.K.Kabir learned Senior Counsel appearing for the appellant invites us to place a restricted meaning to the words of an audit has been initiated occurring in Section 106(2)(b) as an audit relating to a registered service that is being provided by the appellant. He would attempt to buttress his submission by referring to the clarifications issued by the department on 25.11.2013, which according to him would lead to an inference that the inquiry or investigation or audit contemplated under Section 106(2) should be in relation to the registered se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ision." 15. This clarification itself does not support the interpretation placed by Mr.M.K.Kabir, learned Senior Counsel appearing for the appellant. It is seen from the material on record that the fact that the appellant was also providing service of renting of immovable property, apart from the two registered services viz. accommodation service and restaurant service was unearthed by the Department, during the course of the audit that was held on 25.02.2013 and 28.02.2013. Therefore, the issue regarding provision of the service of renting of immovable property was discovered later on and it is definitely referable to the audit held on 25.02.2013 and 28.02.2013. It is also borne out by records the said audit was pending as on 01.03.2013. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t an audit has been initiated and it is pending, there is no scope for restricting the sweep of Section 106(2)(b) to an audit in relation to a particular kind of service. If at an audit, the department is able to unearth a service being rendered by the assessee, which has neither been registered nor been assessed to, it is definitely open to the department to require the assessee to pay the service tax and the penalty payable for providing such service. The rigour of such taxing statute cannot be whittled down by the appellant by seeking to invoke so called voluntary compliance that too after the fact that the service has not been registered or has not been taxed was discovered by the department. 18. We therefore concur with the view of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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