Customs, Excise and Gold Tribunal - Delhi
National Cable Network vs Commissioner Of C. Ex. on 3 September, 2007
Equivalent citations: 2008[9]S.T.R.24
ORDER T.V. Sairam, Member (T)
1. This is an appeal filed by the Cable Operator challenging the order of the Commissioner (Appeals), Jaipur. In the impugned order, the learned Commissioner has confirmed the demand of Service Tax of Rs. 78,025/- under Section 68, interest under Section 75 and penalty under Sections 76, 78 and 77 of the Finance Act, 1994.
2. The learned Counsel for the appellant submits that the appellants are challenging the chargeability of the tax but their grievance is mainly on the following grounds:
The show cause notice issued by the department has invoked the extended period of demand more than one year by stating that there was an intention on the part of the appellants to evade payment of tax. It was contended that no proof has been established by the department in the show cause notice nor in the order issued by the authorities below. Secondly, the learned Counsel for the appellant also contended that there was some calculation error while arriving at the demand amount. Between 1-9-2003 and 31-10-2003, there was fierce rivalry between multi system operators at Kota and hence no service could be provided by the appellant. To prove its point, copies of some newspaper cuttings from Dainik Bhaskar dated 3rd October, 2003 and 5th October, 2003 were also produced before me. It was further submitted that for the entire disputed period i.e. 16-8-2002 to 31-12-2003, the department (as per the statement of the appellant) conceded Rs. 9,45,000/- as a reasonable figure of taxable value and therefrom computed the tax liability on them (Rs. 56,671/-). Overlooking this fact, the department had erroneously computed tax liability of Rs. 21,358/- for the period between 1-9-2003 and 31-12-2003 which, the learned Counsel calls "double taxation".
It was further contended that the penalty imposed on the appellant has been draconian as its total amount far exceeds the tax alleged to be evaded by them. In this context, it was pleaded that in the appeal before the Commissioner of Central Excise they had in ground No. 1 brought out this fact that they are small entrepreneur, having no knowledge of service tax which was a new levy, thereby substantially making out a case by bringing the ingredients under Section 80 of the Act before the authorities which was never considered by the Commissioner (Appeals) in his impugned order.
3. The learned authorized representative (DR) submits that the appellants were silent before the authorities below on the limitation issue as they never raised this point. Similarly, the appellants never raised their grievance about the double taxation and valuation method etc. before the lower authorities and they are bringing this for the first time before this forum. Though it was contended that new issues cannot be raised at this juncture, the learned DR has no answer relating to the issue of "double taxation" as raised by the appellant.
4. Having heard both sides and perused the record, it appears that the authorities below have not considered the request of the appellants as appearing in the appeal memo ground No. 1, according to which the appellants was a small entrepreneur having no knowledge of the service tax and he was agent of cable operator and hence there was some confusion existing in the minds of the appellant. The raison d'etre of Section 80 has obviously not been taken into account while levying heavy penalties on the appellant. I also find that although the show cause notice refers to the "intention to evade payment of tax" on the part of the appellant, no concrete evidence is forthcoming to substantiate this charge against the appellant. This aspect has not been fully discussed in any of the order passed by the authorities below. As regards the period of turmoil on account of fierce rivalry which existed during the relevant period, the Assistant Commissioner has simply sated that he did not accept their submission. While arriving at this conclusion, he has not given any reason as to why he did not accept their submission. I, therefore, find" that the orders have been passed hastily by the authorities below. It is, therefore, necessary that in the interest of justice, the matter needs to be remanded to the Commissioner (Appeals) with the clear direction that the various issues raised in the show cause notice need to be re-examined as per law to arrive at a fresh decision, based on reasons and after following principles of natural justice. Accordingly, I, set-aside the impugned order and allow the appeal by way of remand to Commissioner (Appeals). Ordered accordingly.
[Pronounced and dictated in the open Court on 3-9-2007]