TMI Blog2018 (8) TMI 1690X X X X Extracts X X X X X X X X Extracts X X X X ..... - CESTAT NEW DELHI], where it was held that the adjudicating authority has clearly stated that there was interpretation of law involved and the extended the benefit of Section 80 of Finance Act, 1994 for not imposing and penalty. It clearly shows that the ingredients required for invoking extended period are not present in this case. Indeed in the entire adjudication order there is no word as to how the extended period is invocable - the decision which was relied upon by the Tribunal was never challenged by the department and in view of the consistent practice that the decision which has been accepted by the department should be accepted for every assessee. The issues are answered in favor of assessee against the department - appeal dismissed - decided against Revenue. - D.B. Central/Excise Appeal No. 36/2017 - - - Dated:- 7-3-2018 - MR. K. S. JHAVERI AND MR. VIJAY KUMAR VYAS, JJ. For The For Appellant(s) : Mr. Sandeep Pathak For The For Respondent(s) : Mr. Sameer Jain with Mr. Dakh Pareek And Mr. Arjun Singh Order 1. By way of this appeal, the appellant has challenged the judgment and order of the Tribunal whereby Tribunal has disposed of the appeal by o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere relief from penalties is granted by giving the benefit under Section 80 of the Act of 1994 (on the basis of bonafide belief on the part of the Assessee, the extended period of limitation cannot be invoke for confirmation of service tax demand on the basis of the allegations of willful missstatement, suppression of facts or deliberate contravention of Rules with an intention to evade the duty payment? Whether the learned CESTAT was correct in holding that the ingredients of Section 80 of the Act of 1994 are same as that of the Act of 1994 are same as that of the ingredients which are required for invoking extended period of limitation provided in the proviso to Section 73(1) of the Act of 1994? 3. Counsel for appellant has taken us to the original order which has been passed by the authority and contended that taking into consideration the conduct of the respondent which is narrated as under: 5. On being asked, M/s RRECL provided the requisite information vide their letter dated 10.12.08, 01.09.09, 22.09.09 and 04.12.09 and also submitted a chart as the breakup of various fees received from July 2005 to November, 2008 wherein they havd shown taxable value and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 30000 50000 150000 100000 1300012 2. Processing fees for solar point plant 0 0 0 1500000 34625000 3. Application Fees Biomass power project 250000 37500 1950000 0 0 4. Processing fees for biomass power plant 0 4580000 0 1632500 2750000 5. Application fees 10/20/25 MW wind farm 6335000 45205000 23395000 17968750 15195000 6. Registration fees 0 0 0 0 50000 7. Extension fees-wind Farm 5085000 1500000 9200000 34765000 0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ations, collection of telephone and electricity bills), which are also provided by other commercial organizations. Such services are liable to service tax under appropriate taxable services. 22. As regards invocation of extended period the noticee have submitted that extended period is not available to the department as there was no suppression of fact and they were under bonafide belief that they were not liable to pay service tax on the inpugned activities. I find that there has been a deliberate act by the noticee to the suppression the information in as much as they did not take registration, did not pay service tax and also did not file any returns. It was only when the department collected information that the evasion was unearthed. Suppression means failure to disclose full information with the intent to evade payment of duty as held by Hon ble Supreme Court in case of Continental Foundation Jt. Venture vs CCE Chandigarh- I [2007 (216) ELT 177 S.C.) Similarly Hon ble CESTAT in case of Chemfab Alkalis Ltd. vs CCE Pondichery [2010 (25l) E.L.T.264Tri.- Chennai held: It cannot be a case of anybody that since all the excisableunits are being audited by the department from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted ₹ 68 lakh voluntarily, I am inclined to accept the plea of the noticees there was reasonable cause for failure to pay tax. It has been held in several cases even if the proviso to section 73 for extending the period of demand on account of suppression of fact etc is invoked the waiver under section 80 can still be given. I therefore extend the benefit of section 80 of the Finance Act, 1994 and waive penalty under section 76,77 and 78 of the Act. 4. Counsel for appellant has relied upon in the following decisions: 1. Tamil Nadu Housing Board vs. Collector of Central Excise, Madras, 1994 (74) ELT 9 (SC), wherein it has been observed as under: Section 11A of the Act empowers the Central Excise officer to initiate proceedings where duty has not been levied or short-levied within six months from the relevant date. But this period to commence proceedings under proviso to the Section stands extended to five years of the duty could not be levied or it was short-levied due to fraud, collusion, wilful misstatement or suppression of facts etc. The proviso to Section 11A reads as under: Provided that where any duty of excise has not been levied or. paid or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It would have been better if the appellant would have examined the officer who was advised not to take licence. But mere non-examination of officer could not give rise to an inference that the appellant was intentionally evading payment of duty. When the appellant was found not to have been making any profit and it had taken out licence for concrete unit then in absence of any other material to prove any deliberate act of the appellant the presumption of reasonable doubt of the appellant cannot be said to have been successfully rebutted. The finding of the Tribunal that there was an intention on the part of the appellant to evade payment of duty, is not based on any material. It was an inference drawn for which there was no basis. 2. Padmini Productys vs. Collector of C. Ex., 1989 (43) ELT 195 (S.C), wherein it has been observed as under: 8. Shri V. Lakshmi Kumaran, learned Counsel forhe appellant drew our attention to the observations of this Court in Collector of Central Excise, Hyderabad v. Chemiphar Drugs and Liniments, Hyderabad MANU/SC/0112/1989 : [1990]184ITR224(SC) of the report, this Court observed that in order to sustain an order of the Tribunal beyond ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iew of notification No. 111/78 , referred to hereinbefore, and in view of the fact that there was scope for believing that it was exempt under Schedule annexed to the first notification, i.e., 55/75, being handicrafts, the appellants could not be held to be guilty of the fact that excise duty had not been paid or short-levied or shortpaid or erroneously refunded because of either any fraud or collusion or wilful misstatement or suppression of facts or contravention of any provision of the Act or Rules made thereunder. These ingredients postulate a positive act. Failure to pay duty or take out a licence is not necessarily due to fraud or collusion or wilful misstatement or suppression of facts or contravention of any provision of the Act. Suppression of facts is not failure to disclose the legal consequences of a certain provision. Shri Ganguly, appearing for the revenue, contended before us that the appellants should have taken out a licence under Rule 174 of the said Rules because all the goods were not handicrafts and as such were not exempted under notification No. 55/75 and, therefore, the appellants were obliged to take out a licence. The failure to take out the licence and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of six months on the ground that these dhoop sticks, etc. were not handicrafts entitled to exemption, we set aside the order of the Tribunal and remand the matter to the Tribunal to modify the demand by confining it to the period of six months prior to issue of show-cause notice and pass consequential orders in the appeal on the question of penalty and confiscation. The appeal is allowed to the extent indicated above and the matter is, therefore, remanded to the Tribunal with the aforesaid directions. This appeal is disposed of accordingly. 3. Collector of Central Excise vs. Chemphar Drugs Liniments, 1989 (40) ELT 276 (S.C.), wherein it has been observed as under: 8. Aggrieved thereby, the revenue has come up in appeal to this Court. In our opinion, the order of the Tribunal must be sustained. In order to make the demand for duty sustainable beyond a period of six months and up to a period of 5 years in view of the proviso to sub-section 11A of the Act, it has to be established that the duty of excise has not been levied or paid or short-levied or short-paid, or erroneously refunded by reasons of either fraud or collusion or wilful misstatement or suppression of f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be reimbursed by the buyer. In fact such a plea was clearly taken. The factual scenario clearly goes to show that there was scope for entertaining doubt, and taking a particular stand which rules out application of Section 11A of the Act. 5. Uniworth Textiles Ltd. vs. Commissioner of Central Excise, Raipur, 2013 (288) ELT 161 (SC), wherein it has been observed as under: 21. The Revenue contended that of the three categories, the conduct of the Appellant falls under the case of willful misstatement and pointed to the use of the word misutilizing in the following statement found in the order of the Commissioner of Customs, Raipur in furtherance of its claim: The noticee procured 742.51 kl of furnace oil valued at ₹ 54,57,357/- without payment of customs duty by misutilizing the facility available to them under Notification No. 53/97-Cus. dt. 3.6.1997. 22. We are not persuaded to agree that this observation by the Commissioner, unfounded on any material fact or evidence, points to a finding of collusion or suppression or misstatement. The use of the word willful introduces a mental element and hence, requires looking into the mind of the Appell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder: We have considered the submissions of the learned DR and have gone through the records of this case. The respondent as holding company of their subsidiary companies as mentioned above, are monitoring their performance regularly and take timely corrective actions in case of slippages, provide technology upgradation plan, research and development plan, customer s project execution plan etc., in order to diagnose the operational problems and provide solutions in time. The services being provided by the respondent are clearly covered by the definition of Management Consultancy Services under Section 65(65) of the Finance Act, 1994. We do not agree with the findings of the Additional Commissioner that there is no service provider and client relationship between the respondent and their subsidiaries, as the respondent as holding company and their subsidiary are independent entities. We find that same view has been taken by a Coordination Bench of the Tribunal in case of CST, Mumbai vs. Essel Corporate Services Pvt. Ltd. reported in 2014-TIOL-832-CESTAT-MUM. In view of this the impugned order setting aside the service tax demands is not correct. However, since the responde ..... X X X X Extracts X X X X X X X X Extracts X X X X
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