Custom, Excise & Service Tax Tribunal
Alwar Cable Network, vs C.C.E. Jaipur I on 5 September, 2018
IN THE CUSTOMS, EXCISE AND SERVICE TAX
APPELLATE TRIBUNAL, NEW DELHI
PRINCIPAL BENCH, COURT NO. IV
Service Tax Appeal No. 987 of 2009
[Arising out of the Order-in-Appeal No. 110(DK)ST/JPR-I/2009 dated
08.09.2009 passed by Commissioner (Appeals), Customs & Central
Excise, Jaipur I ]
M/s. Alwar Cable Network Appellants
Vs.
CCE & CST, Jaipur II Respondent
Appearance:
Ms Priyanka Goel, Advocate for the Appellants Shri G R Singh, AR for the Respondent CORAM:
Hon'ble Mr. C L Mahar, Member (Technical) Hon'ble Ms. Rachna Gupta, Member (Judicial) Date of Hearing : 13.08. 2018 Date of Decision : 05.09. 2018 FINAL ORDER No. 52904 /2018 Per: C L Mahar:
The brief facts of the matter are that the appellants are engaged in providing services such as 'advertising agency service' as well as 'multi system operator services (MSO)'. The department is of the ST/987/2009 view that the since 10.9.2004, the 'multi system operations' are covered under heading 'cable services' as defined under section 65 (20) of the Finance Act 1994 and therefore, the appellants were needed to pay Service Tax on the gross amount received by them from the recipient of 'multi system operations service' which are primarily 'input service' for 'cable network services'. The period of demand under the impugned show cause notice is from 10.9.04 to 30.6.06. In the above show cause notice service tax demand of Rs.11,35,750/- was confirmed by the original adjudicating authority.
Penalties under section 76 and Section 78 were also imposed. The appellants have gone before Commissioner (Appeals) against Order- in-Original wherein the learned Commissioner (Appeals) has confirmed the Order-in-Original. The appellant is before us against the above mentioned impugned Order-in-appeal.
2. It has been the contention of the learned advocate for the appellant that they were under the genuine belief that CBEC has issued a clarification in 2002 under their letter No. B-11/I/2002 TRU dated 1.8.2002 wherein it was clarified that 'service tax is leviable to be paid by the cable operator providing services to ultimate subscriber of the cable service. As they are providing signals to cable operators and they are not in the service of providing cable operator services directly to the ultimate subscriber and therefore, they were under the impression that such service is beyond the scope of cable operator 2 ST/987/2009 services and therefore not liable to Service Tax. It has also been contended that the Show cause notice dated 08.01.2007 is hit by period of limitation as the appellant has not suppressed, mis-declared any facts with an intention to evade the levy service tax. As they were under firm belief on the basis of CBEC's clarifications dated 1.8.2002 (supra) have the valid ground to plea that the services provided by them does not fall under the service tax and therefore, non-payment of Service Tax was without any intention to evade the payment of service tax. Hence, the lower adjudicating authority have gravely erred in confirming the Service Tax under the extended time proviso under section 73(1) of the Finance Act, 1994. Learned advocate has also contented that the Circular issued by the CBEC under their letter dated 1.8.2002 (supra) is still in operation and it has not been withdrawn subsequent to the necessary changes which has been effected on 10.9.04 in the definition of cable services. The learned advocate has also cited this Tribunal decision in the case of CCE, Jaipur II vs. Sky Media Pvt. Ltd. [2017 (11) TMI 1466 CESTAT New Delhi] wherein it has been held by this Tribunal that since during the period of dispute, there was a genuine confusion in the mind of assessee about the taxability on the kind of service provided by them under the category of 'cable operator service' and therefore, the extended time proviso is not leviable following various decisions of Hon'ble Supreme Court in this regard. 3
ST/987/2009
1. Cosmic Dye Chemicals vs. CCE [1995 (75) ELT 721 (SC)];
2. CCE vs. Chempar Drugs & Laminates [1989 (40) ELT 276 (SC)];
3. Padmini Products vs. CCE [1989 (43) ELT 159 (SC)];
4. Tamil Nadu Housing Board vs. CCE 1994 (74) ELT 9(SC)]; and
5. T N Dadha Pharmaceuticals vs. CCE [2003 (55) RLT 20 (SC)].
3. On the basis of above decision of this Tribunal and quoting various decisions of Hon'ble Supreme Court, learned advocate has contended that penalty under section 78 is also not imposable.
4. We have also heard the learned DR who has reiterated the findings of the Commissioner (Appeals)'s order.
5. We have heard both the sides and have perused the record of appeal. It is a matter of fact that the appellants are registered Service provider and they have been filing Service tax returns for other services provided by them namely 'advertising agency services'. It takes us to infer that the appellants are well conversant about the provisions of Service tax law as they have been complying with the same in respect of other services provided by them. It is also a matter of record that the definition under section 65 (20) has been amended with effect from 10.9.2004, wherein multi system operator were also been included in the scope of 'cable operator service'. In view of the 4 ST/987/2009 above, we hold that Service tax is leviable on the 'multi system operator' providers since 10.9.04 and as the appellants have been providing multi system operator services, they are very much covered under Section 65(20) of the Finance Act, 1994 under the 'cable operator service' and therefore, we opine that the appellant assessee should have discharged their Service tax liability with effect since 10.9.2004. Thus, we hold that the activity of appellant is leviable for service tax w.e.f. 10.9.04 and therefore, confirmation of short payment of service tax by the lower authorities is legally correct and as per the provisions of law.
6. Coming to the question whether the extended time proviso, circumstances in which the appellant operated is invokable or not, we are of the view that appellants being old assessee of the service tax were very much aware about the day today developments in the provisions of the Service Tax Act. It is wrong on their part to say that the CBEC Circular dated 1.8.2002 has made them to believe that MSO services are not leviable for Service Tax.
7. Since the assessee was very much paying service tax as well as filing the Service tax returns for the other services , they cannot claim that they were not aware about the changes that came into effect from 10.9.2004. It is also matter of record that Shri Mukesh Gupta, partner in his statement dated 15.6.2006 has stated that they were aware that 5 ST/987/2009 service tax is leviable on MSO as the broadcaster such as Star TV, Sony TV, ESPN has been charging service tax from them on the invoices raised by them for providing the signals to them for further transmission as MSO and therefore, it is absolutely wrong on the part of the appellant to say that there was confusion because of Circular dated 1.8.2002.
8. The judgment of Hon'ble Supreme Court as well as decisions of this Tribunal in the case of CCE Jaipur vs. Skymedia is concerned, there is a vast difference in the facts of the matter and same are not applicable in this case because here the appellants were aware about the developments and changes in the law. However, they chose not to pay service tax on the activity undertaken by them as a service provider, thus considering the facts of this case, we are of the opinion that longer period of limitation is available to the Revenue.
9. In view of the above, we do not find any infirmity in the impugned Order-in-Appeal and same is upheld and appeal is accordingly dismissed.
(pronounced in the open Court on 05.09.2018 ) ( Rachna Gupta ) ( C L Mahar ) Member ( Judicial ) Member (Technical) ss 6