TMI Blog2019 (2) TMI 959X X X X Extracts X X X X X X X X Extracts X X X X ..... ng it with huge outstanding overheads. It has pointed out that it has taken all the contingency measures. It has also pointed out the hardship on account of the notices under section 87 of the Finance Act, 1994. What we have on record, therefore, is a request to withdraw these notices. These are on several grounds. The petitioner, in one of its communications has stated that it does not carry out any activities in India and therefore, the provisions of the Finance Act, 1994 do not apply. The petitioner, therefore, disputes its liability to pay service tax and interest. Instead of this court going into these disputed issues, in facts peculiar to this case and without this order being treated as a precedent for the future cases, the respondents should provide an opportunity to the petitioner so as to make good its case and particularly the stand in the writ petition. The petitioner has raised several grounds. It has also said that it does not carry out activities in India. It has also raised the issue with regard to the activity of catering undertaken by it and urged that this is a deemed sale and not leviable to service tax - the petitioner has specifically stated that section 87 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es. The customers did not make timely payments and that is why the petitioner stated that the crises followed. In para 5.4 of the petition, major outstandings of the petitioner are mentioned and it is claimed that the petitioner also reached a settlement with one of the debtors. It is claimed that though there was a settlement, still, the payments have not been made by one entity, namely, M/s. Gol Offshore Limited. 4. It is claimed that a visit was made by the investigation team and certain documents were seized. Thereafter, some records were called for and the petitioner pointed out that the details would be duly forwarded. Accordingly, the details were forwarded. The petitioner, by two e-mails, communicated to the department that ₹ 2 lakhs have been paid towards service tax liability and ₹ 44,36,158/- towards the Goods and Service Tax (GST) liability. It is claimed that on 13th April, 2018, the department pointed out that the outstanding amount of service tax is ₹ 1,86,63,841.78. It is claimed that this letter was replied and it was pointed out that because of delay in clearance of payment by the major customers, the petitioner has failed to effect the paymen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ility for the period 2012-13 till June 2017 is worked out by you to be approximately ₹ 2.51 Crores. You have not provided any basis as to how you have worked out this pending liability. Besides this, you have also accepted that your company is liable to pay appropriate interest on the delayed payment of Service Tax. You had further stated that you have not worked out the Tax Liability of your company under GST regime and assured to provide the details thereof within a week's time. You also accepted that your company is also liable to pay appropriate interest thereon. You had further assured that the outstanding Tax liability alongwith appropriate interest would be paid by you by the end of April, 2018. 2. Further, during oral discussions, you had informed that you are proposing to have a meeting with some shareholders to raise funds. You had also informed that there are some outstanding dues from one M/S Punj Lloyd Ltd. amounting to ₹ 1.19 Crores. You suggested that the outstanding tax dues would be discharged/paid from these sources. 3. Vide email dated 19.04.2018, you were asked to submit the reconciliatory of ST-3 Returns filed by you vis-a-vis the Bala ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... already deposited 25% of the committed amount of ₹ 5.00 Crores. However, it appears that the said funds received is not utilised for payment of Service Tax dues, being a Crown's Debt. Further, you have stated that the balance funds would be raised only by June, 2019 and requested this office to accept the proposal to discharge entire dues by June, 2019. 7. All the above submissions made by you show that you are having a very casual approach towards the Service Tax liability for which you have not taken any concrete efforts since the visit of the officers from this Department on 28.03.2018. A period of more than one and half months have passed and you have paid only ₹ 20 Lakhs against the self-admitted Service Tax liability of ₹ 2.51 Crores for the period from 2012-13 till June 2017 and even not counted for the liability of applicable interests and penalties. 8. Further, as regards the liability under GST regime, i.e. for the period from July 2017 to March 2018, you have reported that you have made payment of ₹ 44,10,180/- vide various challans all dated 03.05.2018, after adjusting the ITC amounts. However, it is observed that though the liabili ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vited to what is styled as a representation. It is claimed that in this representation, all the contested issues have been raised. It is claimed that if this is addressed by the authorities and after the petitioner is heard and an order is passed, then, that would serve the ends of justice. The petitioner has undertaken before us not to claim any refund of the taxes which have been paid. Further, the petitioner has also undertaken not to withdraw any sums from the bank accounts with the above two banks, save and except in ordinary and regular course of business. The petitioenr would not transfer any sums to the credit of these accounts to any entity or sole proprietary concerned of the Managing Director. Based on these undertakings, it is claimed that the petitioner be given an opportunity to make good its case. 9. On the other hand, Mr.Walve appearing for the respondents would submit that there is a huge sum which is still due and payable. The petitioner has not pointed out that there is no dispute ever raised about the liability. In fact, the petitioner is not fair in not inviting the attention of this court to firstly, sub-section (1B) of section 73 and then to section 73A of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ose of any entry, endorsement or the like being made before payment is made, notwithstanding any rule, practice or requirement to the contrary; (iii) in a case where the person to whom a notice under this section is sent, fails to make the payment in pursuance thereof to the Central Government, he shall be deemed to be an assessee in default in respect of the amount specified in the notice and all the consequences of this Chapter shall follow; (c) the Central Excise Officer may, on an authorisation by the Principal Commissioner of Central Excise or Commissioner of Central Excise, in accordance with the rules made in this behalf, distrain any movable or immovable property belonging to or under the control of such person, and detain the same until the amount payable is paid; and in case, any part of the said amount payable or of the cost of the distress or keeping of the property, remains unpaid for a period of thirty days next after any such distress, may cause the said property to be sold and with the proceeds of such sale, may satisfy the amount payable and the costs including cost of sale remaining unpaid and shall render the surplus amount, if any, to such person; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n several grounds. The petitioner, in one of its communications has stated that it does not carry out any activities in India and therefore, the provisions of the Finance Act, 1994 do not apply. The petitioner, therefore, disputes its liability to pay service tax and interest. 14. To our mind, this issue, though raised by the petitioner at a belated stage, requires a consideration at the hands of the respondents. The petitioner has been consistently maintaining that their bank accounts need not be frozen. It has also set up a main and alternate case. It is apparent from the annexures to the writ petition that the respondents say that the petitioner has admitted the service tax liability as in July/August, 2018 of ₹ 2.51 crores. However, it is the respondents who are saying that the figures provided by the petitioner under a statement of the service tax liability up to 31st March, 2017 are different. That is set out in the communication of the respondents of 20th August, 2018 (Exhibit 'R') at page 80 of the paper book. The petitioner's returns were also scrutinised and it is claimed that there is a self declared unpaid service tax liability. A reference has also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the authorities, will not claim any refund of the amount paid and remitted to the respondents as taxes. Thus, no refund claim would be laid before the respondents. Secondly, in the event the two bank accounts are released, the proceeds thereof shall be utilised entirely during the ordinary and regular course of the petitioner's catering business and its dealings and transactions as hospitality service provider. The petitioner will also not transfer any of the amounts in the two bank accounts upon their release from attachment to the accounts maintained in the name of its sole proprietor or any sole proprietary concern of the petitioner. The amount, thus, would not be diverted to any personal account. 19. In the light of these statements, which are made and accepted as undertakings given to this court, we grant the petitioner an opportunity to appear before the Commissioner, CGST, Mumbai West Commissionerate, Mumbai, who shall, after the personal hearing is concluded, pass a reasoned order. He shall do so as expeditiously as possible and in any event, by 10th March, 2019. The contentions as raised before us can be raised before him and we clarify that we have not expressed a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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