Custom, Excise & Service Tax Tribunal
M/S. Patancheru Enviro Tech Ltd vs Cce Hyderabad - I on 22 August, 2013
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH BANGALORE COURT - I Application Involved: ST/Stay/2396/2012 in ST/3303/2012-DB Appeal Involved: ST/3303/2012-DB [Arising out of Order-in-Original No.04/2012 (Service Tax)- Commr. dated 31/08/2012 passed by the Commissioner of Customs, Central Excise & Service Tax, Hyderabad-I Commissionerate, Hyderabad.] M/s. PATANCHERU ENVIRO TECH LTD Appellant Versus CCE HYDERABAD - I Respondent
Appearance:
Mr. Harish.R, Advocate For the Appellant Mr.A.K. Nigam, Addl. Commissioner (AR) For the Respondent Date of Hearing: 22/08/2013 Date of Decision: 22/08/2013 CORAM:
HON'BLE SHRI S.S.KANG , VICE PRESIDENT HON'BLE SHRI B.S.V.MURTHY , TECHNICAL MEMBER Final Order No. 26399 / 2013 Order per. S.S.KANG Heard both sides. Applicant filed this application for waiver of pre-deposit of service tax of Rs.3,15,26,651/-, interest and penalties. The applicants had set up industrial effluent treatment plant in the year 1994. The treatment plant is set up at an industrial cluster in Andhra Pradesh to treat the effluent of industry. A show-cause notice was issued to the applicant demanding service tax by classifying the service as club or association service which was brought into cover of service tax w.e.f. 16.6.2005. The applicants claimed before the adjudicating authority that the service in question is exempted from payment of service tax retrospectively by Finance Act, 2012. The benefit of exemption is denied to the applicant on the ground that the applicant failed to show that the project i.e., treatment plant is set up with the financial assistance from the Central Government or the State Government as per the requirement of the retrospective exemption.
2. The contention of the applicant is that appellant produced letter dated 11.5.2005 whereby the applicant received assistance from the Government of India regarding upgradation of the plant and the adjudicating authority had not accepted that letter as fulfillment of the condition of the retrospective exemption on the ground that the same is not in respect of the setting up of the plant. The applicant now relied upon the letter dated 31.12.1991 issued by Government of Andhra Pradesh whereby the second installment of Rs.22.50 lakhs is sanctioned for setting up of the plant in question and the letter shows that the first installment of Rs.22.50 lakhs has already been released. The contention is that in view of this letter, it cannot be said that the plant in question is not set up from the financial assistance from the Government, hence the applicants are covered under the retrospective exemption Notification.
3. Revenue submitted that before the adjudicating authority the letter now relied upon has not been produced and the applicant only produced the copies of the balance sheet which is specifically noted by the adjudicating authority while passing the impugned order. The additional evidence requires verification.
4. We find that demand is confirmed under the category of club or association service. The club or association service in respect of common facility, set up for treatment and recycling of effluents and solid waste, with financial assistance from the Central or State Government are exempted from service tax vide Notification No.42/2011 ST dated 25.7.2011. Subsequently by Finance Act, 2012, the exemption is granted retrospectively. The benefit of this retrospective exemption is denied only on the ground that the applicant failed to produce evidence to show that the project i.e. treatment plant is set up with the financial assistance from the Central Government or State Government, which is the condition for the exemption. Now the applicant produced the sanctioned letter dated 31.12.1991 issued by the Government of Andhra Pradesh vide which grant of Rs.22.50 lakhs is already sanctioned and released and second installment has also been released. We find that this letter was not before the adjudicating authority. In view of this, we find that the matter requires reconsideration by the adjudicating authority afresh. The impugned order is set aside after waiving the requirement of pre-deposit of dues and the matter is remanded to adjudicating authority to decide afresh after giving an opportunity of hearing to the applicants to present their case.
(Order Pronounced and Dictated in Open Court) B.S.V.MURTHY (TECHNICAL MEMBER) S.S.KANG (VICE PRESIDENT) rv 4