Custom, Excise & Service Tax Tribunal
M/S Manpasand Manpower Pvt. Ltd vs Commr.Of Service Tax, Kolkata on 5 April, 2013
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL,
EAST REGIONAL BENCH : KOLKATA
S.T.Appeal No.346/12
Arising out of O/A No.136/ST/Kol/2012 dated 25.04.2012 passed by Commr. of Central Excise (Appeals), Kolkata.
For approval and signature:
DR. D. M. MISRA, HONBLE JUDICIAL MEMBER
1. Whether Press Reporters may be allowed to see
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 His Lordship wishes to see the fair copy
of the Order? :
4. Whether Order is to be circulated to the Departmental
Authorities? :
M/s Manpasand Manpower Pvt. Ltd.
APPELLANT(S)
VERSUS
Commr.of Service Tax, Kolkata
RESPONDENT (S)
APPEARANCE Ms. Shivani Shah, C.A. for the Applicant (s) Shri A. K. Biswas, Supdt. (A.R.) for the Department CORAM:
DR. D. M. MISRA, HONBLE JUDICIAL MEMBER DATE OF HEARING & DECISION : 05. 04. 2013 ORDER NO.A-85/Kol/13 Per Dr. D. M. Misra :
This appeal is directed against the Order-in-Appeal No.136/ST/Kol/2012 dated 25.04.2012 passed by Commissioner of Central Excise (Appeals), Kolkata.
2. Briefly stated facts of the case are that the appellant are engaged in providing services of cleaning &manpower recruitment and supply agency, falling under Section 65 (24b) and Section 65 (68) of the Finance Act, 1994, respectively. The appellants are registered for providing such services w.e.f. 29.11.2006. During the course of audit, it had been pointed out by the visiting audit team that the total receipt of gross taxable value against aforesaid services, as per Bank Statement, were Rs.12,25,19,007/-, for the year 2008-2009, whereas the value shown in ST-3 Returns, were Rs.11,79,96,434/-. Thus there was difference in the taxable value amounting to Rs.45,22,643/-, on which service tax was not discharged by the appellant. On being pointed out, the appellant had immediately discharged the service tax of Rs.5,58,999/- vide challan No.573 dated 23.04.2010. Subsequently, a show-cause notice was issued to them proposing penalty under various provisions of the Finance Act, 1994. The adjudicating authority appropriated the amount already paid and imposed penalty of Ra.5,000/- under Section 77 of the Finance Act, 1994 and equal amount of penalty under Section 78 of the Finance Act, 1994. Aggrieved by the said order, the appellant filed an appeal before the ld. Commissioner (Appeals), who has upheld the order by confirming penalty under Section 77 and Section 78 of the Finance Act, 1994. Hence, the present appeal.
3. Ld. C.A., Ms. Shivani Shah, appearing for the appellant, has submitted that they have been providing services of cleaning services and manpower recruitment and supply agency servicefrom 2006 onwards and discharging service tax meticulously. Further, she has submitted that various other charges werecollected by them viz., employees contribution of EPF and labour contribution of ESI from the service receivers and the said statutory charges were not retained by them but ultimately paid to the respective statutory authority. She has contended that the said statutory charges wereduly shown in the invoices raised by them in favour of the client, but no service tax was paid on it. The ld. C.A. has produced a sample Bill No.OS/08-09/May/115 dated 28.05.08. It is her submission that the amount being statutory expenses and reimbursed to the appellants for making payment , on behalf of their clients, hence, the same were not included in the gross taxable value of the services rendered under bonafide belief that such charges were not to be included in the gross taxable value for payment of service tax. Accordingly, even though the amount was reflected in the respective invoices and also in the balance sheet, but no service tax was paid. She has categorically submitted that it was a bonafide belief of non-inclusion of such statutory expenses in the taxable value and there has been no suppression nor any mis-statement of facts. The ld. C.A. has relied upon the Tribunals judgement in the case of Quadrant Communications Ltd. Vs. Commr. of Central Excise, Pune-III reported in 2012 (26) STR 33 (Tri.-Mumbai).
4. The ld.A.R. for the Department, reiterated the findings of the ld.Commissioner (Appeals). He has submitted that non-payment of service tax on thedifferential value, and non-reflection of the correct value received in the ST-3 Returns, amounts to suppression.Hence, penalty has been rightly imposed on them.
5. Heard both sides and perused the records. I find that the appellants are engagedin providing cleaning services and manpower recruitment and supply agency services, during the relevant period.Adifference was found between the gross taxable value shown in the ST-3 Returns, vis-`-vis, Bank Statements of the Company. This discrepancy was noticed by the audit during the course of audit of their record. Accepting the said mistake, the appellants had deposited the amount of service taxand later paid the interest also. I agree with contention of the Ld. C.A. that the discrepancy between the taxable value shown in the ST-3 Returns and the Bank statement was due to receipt of various statutory expenses like,employees contribution of EPF and labour contribution of ESI, which were duly reflected in the respective invoices, but not included in the gross taxable value in the services. The fact that the receipt has been disclosed in the invoices and the amounts were also shown in the invoices as well as in the Bank statements, itself indicate that the approach of the appellant have been bonafide. In these circumstances, I do not find any merit in the order confirming imposition of penalty under Section 78 of the Finance Act, 1994. However, penalty under Section 77 has been rightly invoked and imposed. Consequently, the order of the ld. Commissioner (Appeals) confirming imposition of penalty under Section 78, is hereby set aside and the penalty under Section 77 is upheld.
6. Appeal is partly allowed.
(Dictated and pronounced in the open Court) Sd/ (DR. D.M. MISRA) JUDICIAL MEMBER mm 2 S.T. Appeal No.346/12