Custom, Excise & Service Tax Tribunal
Cce, Allahabad vs M/S A.P.S.M. Study Centre on 3 August, 2011
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
West Block No. 2, R.K. Puram, New Delhi 110 066.
Date of Hearing : 3.8.2011
Service Tax Appeal No. 346 of 2008
[Arising out of the Order-in-Appeal No. 17-ST/ALLD/2008 dated 28.3.2008 passed by the Commissioner, Central Excise, Allahabad]
Coram:
Honble Ms. Archana Wadhwa, Member (Judicial)
Honble Shri Mathew John, Member (Technical)
1. Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No
2. Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? No
3. Whether their Whether their Lordships wish to see the fair copy of the order? Seen
4. Whether order is to be circulated to the Department Authorities? Yes
CCE, Allahabad Appellant
Vs.
M/s A.P.S.M. Study Centre Respondent
Appearance:
Appeared for Appellant : Shri Amrish Jain, SDR
Appeared for Respondent : None
CORAM: Honble Ms. Archana Wadhwa, Member (Judicial)
Honble Shri Mathew John, Member (Technical)
Order No.dated.
Per Archana Wadhwa :
Being aggrieved with the order passed by the Commissioner (Appeals), Revenue has filed the present appeal.
2. We have heard Shri Amrish Jain, ld. SDR for Revenue. Nobody appeared for the respondent.
3. As per the facts on record the respondents are engaged in providing the service of commercial training and coaching. The dispute relates to the fees collected from the students during the period of April, May and June 2003. The original adjudicating authority confirmed the service tax demand of Rs.1,34,344/- on the ground that the said fee was collected by the respondent for the coaching services to be provided by them after 1.7.2003, when the said services were brought under the service tax net.
4. On the other hand, Commissioner (Appeals) has accepted the respondents stand that the levy of service tax on commercial training and coaching services came into force with effect from 1.7.2003. As such, the fee collected in the months of April, May and June 2003, when there was no leviability of Service Tax, even for the coaching to be provided after 1.7.2003, cannot held leviable to service tax.
The Commissioner (Appeals) also allowed the appeal on limitation inasmuch as Show Cause Notice, for the period April 2003 to September 2003 was issued on 20.7.2006. He has observed that the notice makes a general allegation of suppression without adverting to any specific details. Inasmuch as the coaching services came into service tax net with effect from 1.7.2003 and there was no instruction/clarification about the payment of service tax on pro rata basis prior to departments circular dated 5.11.2003 and there was no column in ST-3 returns to disclose the non-taxable service that is received prior to levy of tax, no suppression can be attributed to the assessee. He has further held that non-disclosure of value received before 1.7.2003 against coaching services was due to appellants bonafide interpretation of the act/rules and cannot be considered as suppression. As such, by relying upon various decisions of the Honble Supreme Court as also on the Boards Circular No. 5/92-CX.4 dated 13.10.92 and [1993 (63) ELT T-7], he has held that mere non-declaration is not sufficient for invoking larger period but a positive mis-declaration is necessary. Similarly, he has referred to another circular of the Board No. 268/102/96-CX dated 14.11.96 clarifying that specific ground for extending period of demand must be given as laid down by the Honble Apex court in the case of CCE Vs. HMM Ltd. 1995 AIR SCW 1510. As such by holding that the appellant was having bonafide belief and the legal situation was clarified only with effect from 5.11.2003, no malafide intent can be attributed to the appellant and a demand of duty raised on 20.7.2006 for the period April 2003 to September 2003 is barred by limitation.
5. The said order of Commissioner (Appeals) is impugned before us by the Revenue.
6. Ld. DR appearing for Revenue has drawn our attention to the Tribunals decision in the case of CCE Vs. P.T. Education & Training Service Ltd. reported in 2009 (15) STR 453 (Tri.-Del.) laying down that advances of coaching fee collected prior to 1.7.2003, for a course extended beyond 1.7.2003 are leviable to service tax on pro rata basis. As such, it stands submitted by the ld. DR that the finding arrived at by Commissioner (Appeals) are not correct. He has also assailed the findings of limitation on the ground that as the appellant did not file any ST-3 returns or did not reflect the collection of fees in the said ST-3 returns, there was suppression on their part, justifying invocation of longer period of limitation.
7. After appreciating the submissions made by ld. Advocate and after going through the impugned order, we find that though the decision of Commissioner (Appeals) is not sustainable on merits in view of the declaration of law by the Tribunal in the case of P.T. Education & Training Service Ltd., we are of the view that the appeal can be disposed on the point of limitation. Revenue has again reiterated their stand that inasmuch as there was no return filed by the appellant, the longer period is available. However, we note in the same very judgement of P.T. Education & Training Service Ltd. relied upon by the ld. DR, it stands observed however, we agree with the submissions of the ld. Advocate that the case relates to interpretation of law. Therefore, penalty is not warranted. Accordingly, penalties are set aside. By applying the above findings of the dispute being related to interpretation of law, we are of the view that the longer period cannot be invoked on the same very ground. Admittedly, the period involved in the present appeal is the initial period of introduction of coaching services to the service tax and created a lot of confusion. Even in respect of the fee collected prior to the introduction of the services, the Boards circular was issued only on 5.11.2003 laying down that service tax has to be calculated on pro rata basis. We also note that there was audit on 2004 and a lot of correspondence was exchanged between the appellant and the Revenue, in spite of that, Show Cause Notice was issued only on 20.7.2006. We fully agree with the finding of the authorities that the demand is barred by limitation. Accordingly appeal filed by the Revenue is rejected on the above ground itself.
(Pronounced in open Court) (Archana Wadhwa) Member (Judicial) (Mathew John) Member (Technical) RM