9911796707
TMI Blog2024 (12) TMI 81X X X X Extracts X X X X X X X X Extracts X X X X ..... sions of Finance Act, 1994 has been imposed on the appellant along with penalties under Rule 7C of the Service Tax Rules, 1994. 2. The facts of the case are that the appellant participated in the bids invited by Mines & Geology Department of Government of Rajasthan for grant of right to collect royalty from the quarry licenses holders. In terms of the tender document, the successful bidder was required to deposit the bid amount, which was fixed by the Mines Department. Thereafter, upon collection of royalty from quarry license holders, any profit or loss was to the account of the appellant. The appellant neither collected nor paid service tax on the profit collected over and above the bid amount as it was under the bona fide belief that no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y proposed under Section 76 of the Act was also dropped. 4. However, the demand of service tax was confirmed along with interest and penalties were also imposed for non-payment of service tax on the excess of the royalty amount collected over and above the bid amount during the period April 2009 to March 2012 and non-payment of service tax received in lieu of renting the hotel premise which is used solely for running the hotel for the period July 2012 to March 2014 to the tune of Rs.10,38,240/-. Against the said order, the appellant is before us. 5. Learned counsel for the appellant submits that the issue is no longer res integra for demand of service tax on collecting royalty tax/toll etc. on behalf of the Government department as held b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yable arise at Rs.9,13,027/- whereas the appellant has already paid an amount of Rs.8,14,094/-. Therefore, only limited demand remains to Rs.98,933/-. He also submitted that extended period of limitation is also not invocable in the facts and circumstances of the case. 7. On the other hand, learned Authorized Representative, reiterated the findings of the impugned order. 8. Heard the parties, consider submission and peruse the records. 9. We find that a demand has been against the appellant for non-payment of service tax on amount of royalty collected over and above the bid amount during the April 2009 to March 2012. The said issue has been dealt with by this Tribunal in the case of Mateshwari Indrani Contractors Pvt. Ltd. (supra). The f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the commission received by the appellant. Considering the appellant to be a 'Commission Agent', Revenue was of the view that Service Tax is liable to be paid on such commission under the category of Business Auxiliary Service (BAS) as defined under Section 65 (19) of the Finance Act, 1994. On the above lines show cause notice dated 16/10/2012 was issued to the appellant and after the due process of adjudication, Service Tax demand amounting to Rs. 1,33,58,700/- was slapped along with interest and equal penalty. Aggrieved by the said demand the present appeal stands filed." In these set of facts, this Tribunal observed as under: 6. The appellant, during the period under dispute, have acted as a contractor for NHAI/DMG/CTD and has part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e service. He is of the view that such services have been provided to the Government agencies. But before jumping to the conclusion that the appellant falls within the above category, it is necessary to examine whether the recipient of the service is engaged in business or commerce so as to be covered by 'Business Auxiliary Service'. Such a view has been expressed by the Tribunal in the case of Sukhmani Society in Citizen Services (Supra) where the Tribunal has observed:- "7 .For rendering Business Auxiliary Service, there will be three persons e.g. A, B and C. If B provides the service to C on behalf of the A, then B is said to render business auxiliary service. The consideration for the services would be paid by A to B. The view taken ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of amount over and above the bid amount, no service tax can be levied on such an activity under the category of Business Auxiliary Service. As appellant was engaged in collecting statutory levies on behalf of the government department which is not engaged in a business. Therefore, following the said decision, we hold that demand against the appellant is not sustainable for non-payment of service tax on an amount of royalty collected over and above the bid amount. In view of this, the demand of Rs.21,87,591/- is dropped. 11. With regard to demand of service tax for the period July 2012 to March 2014 confirmed against the appellant for non-payment of service tax on rent amount received in lieu of renting the hotel premises which is used sol ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
