Custom, Excise & Service Tax Tribunal
M/S. Gracure Pharmaceuticals Ltd vs Cce, Jaipur-I on 20 December, 2016
IN THE CUSPTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, NEW DELHI, PRINCIPAL BENCH NEW DELHI
Date of Hearing/Decision:20.12.2016
Service Tax Appeal No.100/ 2011-Customs
[Arising out of Order-in-Appeal No.362(DKV)ST/JPR-I/2010 dated 21.10.2010 passed by the Commissioner (Appeals), Central Excise & Customs, Jaipur-I]
M/s. Gracure Pharmaceuticals Ltd. Appellants
Vs.
CCE, Jaipur-I Respondent
Appearance:
Rep. by Shri Jatin Mahajan, Advocate for the appellant. Rep. by Shri Govind Dixit, DR for the respondent. Coram: Honble Shri S. K. Mohanty, Member (Judicial) Honble Shri B. Ravichandran, Member (Technical) Final Order No.56067/2016 Per B. Ravichandran:
The appeal is against order dated 21/10/2010 of Commissioner (Appeals), Jaipur. The appellants are engaged in export of medicines. To realize export proceeds, they have an arrangement with ICICI Bank by opening Letter of Credit (LOC). The dispute in the present appeal relates to short payment of service tax attributable to the short realized export proceeds. By entertaining a view that they short realized export proceeds are nothing but the commission paid to a foreign bank, the Revenue proceeded to demand and recover service tax attributable to that account. The lower authorities concluded that the short received amount is attributable to the commission paid to a foreign bank.
2. Ld. Counsel for the appellant submitted that they have arrangement only with India based bank, ICICI Bank, for realizing export proceeds. The ICICI Bank paid service tax on banking service based on the commission paid by the appellant to them. There is a short receipt of export proceeds for which proportionate commission was not paid and service tax was also not paid. They have neither dealing with any foreign bank for realizing the export proceeds, nor they have paid any commission to any such bank.
3. Ld. AR reiterated the findings of the lower authorities and submitted that the service tax is being demanded on the commission paid to a foreign bank considering that the short receipt is on that account.
4. We have heard both the sides and perused the appeal records.
5. Admittedly, the appellant have arrangement with ICICI Bank for realizing the export proceeds. The service tax on the commission paid for such arrangement has been discharged. However, there is a short receipt for invoiced amount from the foreign importers/buyers. The commission was only for the amount realized by the appellant. On perusal of the orders by the lower authorities, we find that there is no mention as to which other entity provided the taxable services to the appellant and what kind of consideration has been paid to such service, if any. The service tax demand is based purely on inference that short realized amount of sale proceeds could be attributed to the commission paid to a foreign bank. In the absence of any evidence to that effect, we find no justification to make such inference. Accordingly, the order passed by the lower authority is not sustainable. The same is set aside. The appeal is allowed.
[order dictated & pronounced in open court] (S.K. Mohanty ) Member (Judicial) ( B. Ravichandran ) Member (Technical) Ckp.
The appeal is against order dated 27.09.2010 of Commissioner (Appeals), Jaipur-II. The appellant are engaged in retrading the tyres and were discharging service tax only on the labour charges. They claimed exemption under notification no.12/03-St for the value of the materials consumed during the course of re-trading the tyres. The proceedings were initiated against the appellant to demand service tax on he gross amount including the value of the trade. The Original Authority, on completion of the adjudication, confired service tax liability after extending the benefit of the notification no.12/03-ST. The Revenue filed appeal and the Commissioner (Appeals) disallowd the benefit of the said notification on the ground that the sale is not evidnced as per the doducments perused by him.
\ Ld. Counsel appearing on behalf of the appellant submitted that they have submitted all the invoices and certificate of Charatered Accountant to establish that the value of the goods mainly traded labour, chemicals, etc are shown separately in thie invoices. They were showing service charges and paying tax on the said service charges. The Original Authority having satisfied about their eligibility for notification no.12/03-ST allowed the same. However, on appeal by the Revenue, the Commissioner (Appeals) by the impugned order passed an ex parte order disallowed the concession and confirmed the deamdn on the gross value.
Ld. Counsel submitted that the invoices as well as Chartered Accountants certificates clearly establish the spilt up value and their entitlement for notification no.12/03-St. Ld. AR submitted that the goods consumed in rendering the service become part and parcel of all the services rendred and there is no sale of such goods to claim the benefit of notificaitn no.12/03-ST. Reliance was placed on the decision of the Tribunal in . To state that the goods consumed in providng services cannot e 1