9911796707
TMI Blog2023 (9) TMI 1011X X X X Extracts X X X X X X X X Extracts X X X X ..... ded or to be provided to a policy holder or any person, or any insurer including reinsurer, carrying on life insurance business in relation to the risk cover, in the life insurance. 2. The brief facts are, Appellant was registered with the Service Tax Department and was depositing the admitted taxes and filing the periodical returns regularly. Pursuant to introduction of Service Tax on Life Insurance Premium, the Board issued Circular No. 80/10/2004-ST dated 17/09/2004 by way of clarifying the scope of the newly introduced Services vide inance Act (No. 2) of 2004, enacted on 10/09/2004, clarifying that the risk cover in life insurance becomes subject to levy of service tax. 3. The appellant assessee in compliance to the Board Circular in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oning their request to close the matter under the provisions of Section 73(3) of the Finance Act. 5. Further, Revenue chose to issue Show Cause Notice dated 30/08/ 2011 invoking the extended period of limitation, alleging non-payment of differential service tax (short-paid) alleging suppression as the appellant have declared and paid service tax only on the part amount received, instead of gross Premium. Further stressing that the suppression, misdeclaration would have gone unnoticed but for the timely action initiated by the department, by verifying the records. 6. The appellant filed detailed reply dated 18/11/2011 to the said SCN contesting the allegations therein and inter alia submitted that since they had paid the differential servi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the aforementioned Board Circular dated 17/9/2004, it is evident that service tax has to be paid in respect of composite policy, only on that part of the premium which relates to risk coverage, and not on the other part which relates to savings/investments. Thus the Show-Cause notice is erroneous and issued without analyzing the balance amount of the premium, as to what it relates, service tax has been demanded on the same which was never the intention of the Statute. The premium collected by the appellant in respect of composite policy/group insurance policy includes various other expenses incurred by the appellant in the course of providing life insurance service. Reliance is placed on the ruling of the Hon'ble Delhi High Court in the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eposited along with interest immediately after short payment of tax was informed by the audit party. Show-cause notice was issued subsequently and that Learned counsel also places reliance on clarification issued by Board vide DOF No. 334/3/2011-TRU dated 28/02/2011, wherein, it was clarified that amounts relating to deductions for mortallity, commission and expenses are not available for investment and an option was given to pay tax at the rate of 1.5% of the gross premium amount. Thus, this subsequent clarification by the Board is ample evidence that the issue involved is one of interpretation of legal provisions and no case of fraud/suppression is made out. Appellant relies on the following rulings: i) Ispat Industries Ltd Vs CCE [2006 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of service tax. 12. Having considered the rival contentions, we find that in the facts and circumstances of this case appellant had rightly deposited the tax, as clarified by Board Circular dated 17/09/2004. We further find that the appellant was a registered assessee, and have regularly deposited the admitted taxes and have filed periodical returns. It is further evident that the whole case is due to interpretational issue (change of opinion) on the part of the Revenue. We further find in the facts and circumstances of this case, that the benefit of closure under section 73(3) has been wrongly denied to the appellant assessee, and no show-cause notice was required to be issued. 13. Accordingly in view of the aforementioned findings and o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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