Custom, Excise & Service Tax Tribunal
M/S. Sify Technologies Ltd vs Commissioner Of Central Excise & ... on 23 December, 2014
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
SOUTH ZONAL BENCH AT CHENNAI
ST/00655/2010
[Arising out of Order-in-Original No.LTUC/231/2010-(C), dated 21.07.2010 passed by the Commissioner of Central Excise & Service Tax, LTU, Chennai]
M/s. Sify Technologies Ltd.
Appellant
Versus
Commissioner of Central Excise & Service Tax, Chennai
Respondent
Appearance:
Shri G. Natarajan, Adv. Shri M. Rammohan Rao, DC(AR) For the Appellant For the Respondent CORAM:
Honble Shri D.N. Panda, Judicial Member Honbe Shri R. Periasami, Technical Member Date of hearing/decision : 23-12-2014 FINAL ORDER NO. 41022 / 2014 Per D.N. Panda:
The precise question in this appeal is whether the addition reading as any amount credited or debited, as the case may be, to any account, whether called Suspense account or by any other name, in the books of account of a person liable to pay service tax, where the transaction of taxable service is with any associated enterprise, made to Explanation (c) appearing under sub-section (4) of Section 67 of the Finance Act, 1994 brings the nature of debit or credit of any amount relating to transaction with associated enterprises to the fold of taxation retrospectively i.e., prior to 10.05.2008. The answer to the issue is given by the law laid down in the case of Union of India Vs Martin Lottery Agencies Ltd. reported in 2009 (14) S.T.R.593 (S.C.).
2. The addition to the explanation as above was recognized for the first time in law with effect from 10.05.2008. Such an incorporation gives rise to the determination of liability bringing a change to concept of gross value of taxable service provided by the service provider while dealing with the associated enterprises.
3. Law is well settled that amendment to law can be made retrospectively even bringing an amendment to an Explanation appearing in the statute. But the nature and character of the amendment decides whether such amendment is declaratory or clarificatory and accordingly whether retrospective or not. A declaratory law is always prospective while clarificatory law is retrospective in nature. It is also well settled law that statute making amendment to the effect of declaration of liability is not normally retrospective unless otherwise such intention expressed by legislature or by necessary implication intended to be so.
3. The aforesaid addition to the Explanation (C) to sub-section (4) of Section 67 with the proposition and throws light on the nature and character of both the clauses thereof. It categorically brings out that recording of transactions in two different pattern was enacted from two different dates. Therefore, the addition to the Explanation (C) with effect from 10.05.2008 is prospective in nature and that addition shall be applicable from the day that was enacted in the statute book. Accordingly, there shall be no liability to levy of interest on the gross value of taxable service relating to the period prior to that date.
4. For aforesaid reason the appeal is allowed.
(Dictated and pronounced in open court)
(R. PERIASAMI) (D.N. PANDA)
TECHNICAL MEMBER JUDICIAL MEMBER
ksr
DRAFT
Remarks
I
II
III
Date of dictation
23.12.2014
Draft Order - Date of typing
23.12.2014
26.12.2014
Fair Order Typing
29.12.2014
Date of number and date of dispatch
30.12.2014
2
ST/00635/2010