Custom, Excise & Service Tax Tribunal
Commissioner Of Service Tax vs M/S. Akash Ganga Cable Network on 26 September, 2016
IN THE CUSTOMS, EXCISE AND SERVICE TAX
APPELLATE TRIBUNAL, NEW DELHI
PRINCIPAL BENCH, COURT NO. IV
Service Tax Appeal No. 43 of 2010
[Arising out of Order-In-Appeal No. 167 (DK)ST/JPR-I/2009 dated 10.11.2009 passed by Commissioner (Appeals), Customs & Central Excise, Jaipur]
For approval and signature:
Hon'ble Ms. Archana Wadhwa, Member (Judicial)
Hon'ble Mr. V Padmanabhan, Member (Technical)
1
Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
No
2
Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
No
3
Whether Their Lordships wish to see the fair copy of the Order?
Seen
4
Whether Order is to be circulated to the Departmental authorities?
Yes
Commissioner of Service Tax Appellants
Jaipur
Vs.
M/s. Akash Ganga Cable Network Respondent
Appearance:
Shri Sanjay Jain, AR for the Appellants Shri Yash Dhadda, Chartered Accountant for the Respondent CORAM:
Hon'ble Ms Archana Wadhwa, Member (Judicial) Hon'ble Mr. V Padmanabhan, Member (Technical) Date of Hearing/ Decision: 26.09.2016 FINAL ORDER NO . 53971 /2016 Per Archana Wadhwa (for the Bench):
Being aggrieved with the impugned order passed by Commissioner (Appeals), Revenue has filed the present appeal.
2. After hearing both sides, duly represented by Shri Sanjay Jain, learned DR appearing for the Revenue and Shri Yash Dhadda, Chartered Accountant appearing for the respondent, we find that the respondent is a service provider under the category of cable operator services since 13.11.2002 and was filing Service Tax return by reflecting only the commission received by him. Revenue by entertaining a view that it is gross receipt including the amount paid to MSO which is required to be taxed, initiated proceedings against him by way of issuance of show cause notice dated 24.8.07 raising the demand of duty for the period 13.11.02 to 31.3.06. The said Show cause notice culminated into an order passed by the original adjudicating authority confirming the tax to the tune of Rs.10,02,565/- along with confirmation of interest and imposition of penalty. On appeal against the same, Commissioner (Appeals) set aside the same on the issue of limitation by observing as under:
(c) As regards third ground that appellant has not shown the correct taxable value in the ST-3 returns filed by them from time to time I find that there is no dispute of the fact that service tax was payable on the gross receipt whereas during the intervening period 13.11.02 to 31.3.06, the appellant has continued to pay service tax on value addition (difference between the gross value and the amount paid to the MSO) during the period 13.11.02 to 31.3.06. The question to be examined here is of the said fact proves that there was deliberate suppression of fact with intent to evade payment of service tax or they bonafidely believed that service tax was payable on the value addition or commission alone and not on the gross receipt. I find that when the appellant has continued to file returns, for above 4 years to the Department showing the commission as their taxable value, obviously they had bonafidely believed that service tax is payable on value addition or commission only. Even otherwise if the appellant would have paid service tax on the gross amount including the amount paid to the MSO, they would have been entitled for taking credit of the service paid to the MSO therefore there would not been any additional liability on the appellant as they would have effectively paid service tax on value addition or commission only. Thus the net impact of non-payment of service tax on gross value is revenue neutral. The Honble Supreme Court of India in case of CCE, Vadodara vs. M/s. Narmada Chematin Pharmaceuticals Ltd. [2005 (179) ELT 276 (SC)] has held that in case of revenue neutrality, intent to evade payment of duty cannot be upheld. Even otherwise, there is no evidence available on record which proves that there was any intention to evade payment of service tax by the appellant. The Honble Supreme Court of India in case of Collector vs. Chemphar Drugs & Liniments [1989 (40) ELT 276 (SC)] and Padmini Product vs. Collector of Central Excise reported in 1989 (43) ELT 195 (SC)] has held that something positive other than mere inaction or failure on the part of manufacturer producer or couscous or deliberate withholding of information when the manufacturer knew otherwise is required before he is saddled with duty liability and penalty on the ground of fraud or collusion or willful mis-statement or contravention of any of the provisions of the Act or rules made thereunder with intention to evade payment of duty. In absence of positive evidence being provided by the Department on record, I agree with the appellant contention that their act of payment of duty on value addition was a bonafide act and was not an act of suppression of facts with intent to evade payment of duty. Held accordingly.
3. The said order of the Commissioner (Appeals) is impugned before us by the Revenue.
4. On going through the reasoning adopted by Commissioner (Appeals) for holding the demand to be barred by limitation, we do not find any infirmity in the same. The appellate authority has relied upon the fact that the assessee was continuously filing the return with the department only reflecting the commission as value of the services, which fact leads to inevitable conclusion that there was no suppression or mis statement on the part of the assessee and such reflection of only commission as the value of the taxable value of the services was on account of confusion in the arena In the absence of positive evidence, in our view, he has rightly held to be barred by limitation. Revenues appeal is accordingly rejected.
(dictated and pronounced in the open court )
( Archana Wadhwa ) Member(Judicial)
( V Padmanabhan)
Member(Technical)
ss
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