Custom, Excise & Service Tax Tribunal
M/S. Global Networking Recourses, Pune vs The Principal Commissioner, Service ... on 13 April, 2016
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT NO. II APPEAL NO. ST/86762/15-MUM [Arising out of Order-in- Appeal No. PUN-SVTAX-000-APP-057-15-16 dated 25/6/2015 passed by the Commissioner of Service tax(Appeals), Pune] For approval and signature: Honble Mr Ramesh Nair, Member(Judicial) =======================================================
1. Whether Press Reporters may be allowed to see : No
the Order for publication as per Rule 27 of the
CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the :
CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy : seen
of the Order?
4. Whether Order is to be circulated to the Departmental: Yes
authorities?
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M/s. Global Networking Recourses, Pune
:
Appellants
VS
The Principal Commissioner, Service Tax, Pune
:
Respondent
Appearance
Shri. Mihir Deshmukh, Advocate for the Appellants
Ms. Vinitha Sekhar, Joint Commissioner(A.R.) for the Respondent
CORAM:
Honble Mr. Ramesh Nair, Member (Judicial)
Date of hearing: 13/4/2016
Date of decision: 13/4/2016
ORDER NO.
Per : Ramesh Nair
This appeal is directed against Order-in- Appeal No. PUN-SVTAX-000-APP-057-15-16 dated 25/6/2015 passed by the Commissioner of Service tax(Appeals), Pune whereby Ld. Commissioner(Appeals) upholding the order issued under F. No. VGN(30) STC-II/P-III/VCES-Global/126/13 dated 19/1/2015 rejected the appeal of the appellant.
2. The fact of the case is that the appellant filed VCES declaration on 21/12/2013 for total dues of Service Tax of Rs. 6,36,320/-. As per Section 107 of the scheme, the appellant was suppose to deposit 50% amount i.e Rs. 3,18,160/- on or before 31/12/2013 out of which they paid Rs. 3 lacs on 28/12/2013 and remaining amount of Rs. 18,160/- paid on 2/1/2014. The balance 50% deposited on 28/3/201 for which due date was 20/4/2014. The designated authority i.e. Asstt. Commissioner issued show cause notice on 24/4/2014 proposing rejection of VCES declaration on the ground of the total amount i.e. 50% not paid on or before due date i.e. 31/12/2013. In the adjudication order, declaration was rejected on the same ground. Being aggrieved, the appellant filed appeal before the Commissioner (Appeals) who rejected the appeal of the appellant, therefore the appellant is before me.
3. Shri. Mihir Deshmukh, Ld. Counsel for the appellant submits that out of Rs. 3,18,160/- they had deposited Rs. 3 lacs on 28/12/2013 and only a small amount of Rs. 18,160/- was attempted to be deposited on 31/12/2013 but due to system error this balance amount could not be deposited which was subsequently paid on 2/1/2014. The appellant produced snap shot, bank website as a token of proof of their attempt to make payment on 31/12/2013. They also submitted these evidences before this Tribunal therefore since it is beyond the control of the appellant due to system error, delay if any, occurred should be condoned and accordingly the declaration could not have been rejected. He further submits that as per the Board Circular No. 170/05/2013-ST dated 8/8/2013, designated authority is under obligation to issue show cause notice, if he intends to reject the declaration within 30 days from the date of declaration. In the present case, as per Circular, notice should have been issued within the one month from date of filing the declaration but the notice was issued on 24/4/2014 therefore notice is time bar, accordingly entire proceedings vitiated, for this reason also rejection of their declaration is not legal and correct.
5. Ms. Vinitha Sekhar, Ld. Joint Commissioner(A.R.) appearing on behalf of the Revenue reiterates findings of the impugned order. She submits that time limit for payment of first instalment of 50% was on or before 31/12/2013, which is the mandatory period provided under the statute. There is no provision in the VCSE for extension of time limit or condonation of delay for deposit of 50% amount therefore under any circumstances, the extension cannot be granted beyond 31/12/2013. Both the lower authorities have, correctly following statutory provisions, rejected the declaration. In this support she placed reliance on the Honble Gujarat High Court judgment in case of Ramilaben Bharatbhai Patel Vs. Union of India [2012(35) S.T.R. 695 (Guj)]. As regard the issuance of show cause notice on 24/4/2012, she submits that as per the Circular dated 8/8/2012, issuance of show cause notice was provided under Section 106(2), that means if any deficiency or mis-declaration is noticed in the declaration filed by the assessee, notice should be given within 30 days from the date of declaration. In the present case notice is not given as regard any deficiency in the declaration filed, notice is given for default of payment of 50% which is required to be made on or before 31/12/2013. As regard the deposit of amount provision is made under Section 107 and there is no provision either in the scheme or in the circular for issuance of show cause notice for the failure of compliance of deposit provided under Section 107.
6. I have carefully considered the submissions made by both the sides.
7. I find that the fact of the case is not under dispute. The appellant admittedly have not paid 50% of the total dues declared by them of Rs. 3,18,160/- on or before 31/12/2013. Though they have shown reason for non payment of balance amount of Rs. 18,160/- on 31/12/2013 which was subsequently made on 2/1/2014. Even if the reason given is accepted there is no provision in the scheme to condone the delay in payment, therefore time line prescribed under the scheme cannot be extended in absence of any provision for condoning the delay. The Honble High Court of Gujarat on identical issue categorically held that time line provided under the scheme under Section 107 cannot be extended. As regard the submission of the Ld. Counsel that the show cause notice was not issued within one month from the filing of declaration. I agree with the submission of the Ld. A.R. Provision for issuance of show cause notice has been provided under the circular is only under Section 106(2) which provides that if any deficiency or error is found in the declaration filed under Section 106(2) notice required to be issued, whereas in case of deposit of an amount as provided under 107 there is no provision for issuance of any notice. Since the date of deposit which is later than the filing of declaration, it cannot be expected from the designated authority to issue any notice. Therefore non issue of notice within one month from the date of declaration cannot be reason for vitiating the entire proceedings. In my opinion, even the notice given on 24/4/2014 was also not required for rejecting declaration, however it is appreciable that in order to follow the principles of natural justice the designated authority given an opportunity to the appellant by issuing a notice. As per my above discussion, I do not find any infirmity in the impugned order, the same is upheld, appeal is dismissed.
(Dictated in court) Ramesh Nair Member (Judicial) sk 6 ST/86762/15-MUM