TMI Blog2024 (2) TMI 562X X X X Extracts X X X X X X X X Extracts X X X X ..... ll these documents before the Original Authority for consideration and if satisfied that any part of the amount against which service tax has been demand, have not been received by the appellant to allow him the benefit of the same - matter on remand. Short payment of service tax to the tune of Rs.1,20,094/- by way of wrong availment of abatement under the category of Erection, Commissioning and Installation Services and Construction Services in respect of Commercial or Industrial Buildings and Civil Structures - HELD THAT:- As the appellant failed to establish that claim for exemption under the notification no 1/2006-ST, the demand made by denying abatement for determination of taxable value for the levy of service cannot be faulted with - demand upheld. Short payment of service tax to the tune of Rs.69,864/- by way of wrong availment of Cenvat credit on improper invoices which were not addressed to their registered account - HELD THAT:- The issue in this regard is no longer res integra and the Tribunal/Courts have decided that for claiming the benefit of input services, it is not necessary that invoices be addressed to the registered premises of the appellant - reliance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xus Engineers. M-30. Paper Mill, Mahanagar. Lucknow availed on the basis of improper invoices under Rule 14 of the Cenvat Credit Rule 2004 along-with applicable interest under Section 75 of the Finance Act 1994. (as alleged in the show cause notice dated 24.9.2015). (v) I impose a penalty of Rs.69.864/- (Rs. Sixty Nine Thousand Eight Hundred and Sixty Four only) upon M/s Nexus Engineers, M-30. Paper Mill, Mahanagar. Lucknow under Rule 15(2) of the CENVAT Credit Rules. 2004 read with Section 11AC of the Central Excise Act, 1944. 2.1 Appellant was engaged in providing taxable services and for which they hold appropriate registration under the law. 2.2 During the course of audit, it was observed that on account of certain discrepancies, appellant has short paid service tax to the tune of Rs.6,34,897/- on the following grounds:- I. Short payment of service tax to the tune of Rs.4,44,939/- under the head of Maintenance or Repair Service and Erection, Commissioning Installation Services. On reconciliation of ST-3 return with the income shown in the profit and loss account. It was observed that appellant had short paid the above referred tax. II. Short payment of servic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h intent to evade payment of Service Tax. 2.4 This show cause notice was adjudicated as per the Order-in-Original referred in para-1 above and the appeal filed by the appellant has been dismissed as per the impugned order. Aggrieved appellant has filed the present appeal. 3.1 We have heard Shri Dushyant Kumar learned Consultant for the appellant and Shri Manish Raj learned Authorised Representative appearing for the revenue. 3.2 Arguing for the appellant learned Consultant submits that- The demand has been made in respect of certain amounts which were never received by them from their clients under the category of Maintenance and Repair Erection, Commissioning Service . Their client M/s Indus Tower had made deductions on account of various reasons from the invoice raised by them. These amounts were shown as bad debts in their book of accounts (Profit and Loss Account). Department has while making this demand totally ignored these amounts shown as bad debts in their book of accounts. They had computed and paid the service tax after taking into account these bad debts. As per Rule 6 91) of the Service tax Rules, 1994 they were required to apy service tax only o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... banking and (ii) by the 5th day of the month, in any other case, Immediately following the calendar month in which the payments are received, towards the value of taxable services. Provided that where the assessee is an Individual or proprietary firm or partnership firm, the service tax shall be paid to the credit of the Central Government by the 6th day of the month if the duty is deposited electronically through internet banking, or, In any other case, the 5th day of the month, as the case may be, immediately following the quarter in which the payments are received, towards the value of taxable services. Whereas w.e.f.01.04.2011, the said rule read as follows:- 6(1) The Service Tax shall be paid to the credit of the Central Government (i) by the 6th day of the month, if the duty is deposited electronically through Internet banking and (ii) by the 5th day of the month, in any other case, Immediately following the calendar month in which the service is deemed to be provided as per the rules framed in this regard. Provided that where the assessee is an individual or proprietary firm or partnership firm, the service tax shall be paid to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that since the value on which the demand has been raised was not received by them and accordingly, the Service Tax is not liable to be paid by them. The appellant also claimed that they are submitting the relevant debit notes issued by the Service Receivers, Ledger of Bad Debts, Reconciliation chart etc. with the appeal memorandum which will corroborate their claim. At the outset, I find that no such documents were found to be enclosed with the appeal memorandum in absence of which the claim of the appellant could not be appreciated. Further, even if the claim of the appellant is found to be true, then also the appellant has not put forth any reason for non-payment of Service Tax in the F.Y.2011-12 and F.Y.2012-13. Moreover, I also find that the appellant has failed to produce the credit notes raised by them to their Service Receivers depicting the Service Tax to be reversed by the service recipients if the same has been availed as Cenvat Credit by them. The Central Government from the very beginning has placed full trust on the service providers so far as service tax is concerned and accordingly measures like self-assessment etc., based on mutual trust and confidenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 12/2003- Service Tax, dated the 20 th June, 2003 [G.S.R. 503 (E), dated the 20th June, 2003. 10.2.3 I find that the original adjudicating authority has denied the benefit of exemption Notification on the basis of the fact since the appellant was availing the benefit of Cenvat Credit on various input services such as Telecommunication Service, Internet Service, Business Auxiliary Service, Construction Service etc. hence they have rendered themselves ineligible for the abatement of 67% provided vide the said exemption notification. 10.2.4 Per contra, I find that the appellant has contended that they have availed Cenvat Credit in respect of only those input services which were related to 'Maintenance and Repair Service only and were not related to 'Erection, Commissioning and Installation Services' and 'Commercial and Industrial Construction Service'. The appellant also claimed that they are submitting Annexure-03 to the appeal memorandum which are self- Explanatory. 10.2.5 Since the decision of the appeal requires the interpretation of an e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pe of the exemption Notification. 10.2.6 In light of the above-mentioned judgments, I find that the said exemption notification is clear in its wording that the benefit of abatement would not be available only If Cenvat Credit on Inputs / Capital Goods / Input Services used in providing such services has not been availed. In the present case, I find that the appellant was availing Cenvat Credit in respect of Input services such as Telecommunication Service, Internet Service, Business Auxiliary Service, Construction Service etc. which in my view were common to all of their 3 output taxable services. The input services such as Telecommunication Services, Internet Services etc. are such whose usage cannot be bifurcated between their 3 taxable services. The appellant in the appeal memorandum claimed to submit some Annexure-03 which will corroborate their contention but I could not find any such Annexure-03 enclosed with the appeal memorandum. In view of the above, I find that the appellant has failed to fulfil the primary conditions of an exemption notification. 10.2.7 Accordingly, I find that the benefit of abatement of 67% (on gross receipts) provided under Not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce provided or to be provided and such invoice, bill or as the case may be challan shall be serially numbered and shall contain the following, namely:- (i) the name, address and the registration number of such person; (ii) the name and address of the person receiving taxable service; (iii) description, classification and value of taxable service provided or to be provided, and (iv) the service tax payable thereon. 10.3.4 From the above mentioned rules, I find that the in any service invoice the name and address of the person receiving the service is liable to mentioned compulsorily. The mention of said details provides relevant information regarding the place at which such services have been consumed. In the present case, the Cenvat Credit to the tune of Rs.69,864/- is sought to be appellant and accordingly it could not be ascertained that whether the same were utilised in red address of the denied on a ground that the invoices are not addressed to the registered address of the appellant and accordingly it could not be ascertained that whether the same were utilized in the activity of the output taxable services or not. Per-contra, the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... luding Service Tax) 15896966 N.A. N.A. N.A. 4 TOTAL (1+3) 65909626 39970991 38176755 46659314 5 Current Year Debtors (Including Service Tax) 6581011 N.A. N.A. N.A. 6 Current Year Debtors (Including Service Tax) 5966464 N.A. N.A. N.A. 7 Total Taxable Value (4-6) 59943162 39970991 38176755 46659314 8 Taxable Value as shown in ST-3 Return 56397302 39276309 38122691 48891267 9 Value on which Service Tax not paid (7-8) 3545860 694642 54064 - 10 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. In case appellant fail to produce the documents as above, before the Original Authority on the date on or before the date fixed for hearing, original authority is free to draw adverse conclusion and proceed against the appellant. On the issue no.2- Appellant claim that they are entitled to claim the benefit of abatement under Rule 3 (2) of Works Contract (Composition Scheme for payment of Service Tax) Rules, 2007 and also claim the benefit of the CENVAT Credit in respect of the input services. Rule 3 (2) of the said rules, and explanation 2 to Rule 2B of Service tax (Determination of Value) Rules, 2006 is reproduced below: Rule 3 (2) The provider of taxable service shall not take CENVAT Credit of duties or cess paid on any inputs, used in or in relation to the said works contract, under the provisions of CENVAT Credit Rules, 2004. Explanation 2 to Rule 2(B): For the removal of doubts, it is clarified that the provider of taxable service shall not take CENVAT Credit of duties or cess paid on any inputs, used in or in relation to the said works contract, under the provisions of CENVAT Credit Rules, 2004. We reproduce the proviso appended to exemption Notif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y provisions in the taxing statute and the exemption notifications is required to be analysed first. 9.1 In the case of Dilip Kumar Company (supra), five judge bench of this Court has held that in every taxing statute the charging, the computation and exemption provisions at the threshold stage should be interpreted strictly. In case of ambiguity in case of charging provision, the benefit necessarily must go into favour of the subject/assessee. This means that the subject of tax, the person liable to pay tax and the rate at which the tax is to be levied have to be interpreted and construed strictly. If there is any ambiguity in any of these three components, no tax can be levied till the ambiguity or defect was removed by the legislature [See pages 53 to 55 in Dilip Kumar Company]. However, in case of exemption notification or clause, same is to be allowed based wholly by the language of the notification, and exemption cannot be gathered by necessary implication, or on a construction different from the words used by reference to the object and purpose of granting exemption [See Hansraj Gordhandas Vs. H.H. Dave, Assistant Collector of Central Excise Customs, Surat Ors. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ors. (supra), which decisions have been noted and elucidated by this Court in Dilip Kumar Company. Therefore, in the context of exemption notification there is no new room for intendment. Regard must be to the clear meaning of the words. Claim to exemption is governed wholly by the language of the notification, which means by plain terms of the exemption clause. An assessee cannot claim benefit of exemption, on the principle that in case of ambiguity a taxing statue must be construed in his favour, for an exception or exemption provision must be construed strictly. 9.4 In the case of Giridhar G. Yadalam (supra), it is observed and held that in taxing statute, it is the plain language of the provision that has to be preferred where language is plain and is capable of one definite meaning. It is further observed that the strict interpretation to the exemption provision is to be accorded. It is observed that the purposive interpretation can be given only when there is some ambiguity in the language of the statutory provision or it leads to absurd results. In paragraph 16, it is observed and held as under: 16. We have already pointed out that on the plain language of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of construction to read words into a statute which the legislature in its wisdom has deliberately not incorporated. As the appellant failed to establish that claim for exemption under the notification no 1/2006-ST, the demand made by denying abatement for determination of taxable value for the levy of service cannot be faulted with. Hence in our view the demand on this count needs to be confirmed. On the issue no.3- The credit has been sought to be denied for the reason that the invoices against which the appellant has taken the credit was not addressed to the registered premises of the appellant. We find that the issue in this regard is no longer res integra and the Tribunal/Courts have decided that for claiming the benefit of input services, it is not necessary that invoices be addressed to the registered premises of the appellant. Reliance is placed on the following decisions:- Manipal Advertising Services Pvt. Ltd. [2009 (10) TMI 434 CESTAT, BANGALORE]; mPortal India Wireless Solutions P. Ltd. [2012 (27) S.T.R. 134 (Kar.)]; Allspheres Entertainment Pvt. Ltd. [2015 (8) TMI 953 (CESTAT DELHI)]. Well Known Polyesters Ltd. [2011 (1) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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