Customs, Excise and Gold Tribunal - Mumbai
Bharti Tele-Ventures Ltd. vs Commissioner Of C. Ex. And Cus. on 9 April, 2007
ORDER K.K. Agarwal, Member (T)
1. This is an application for waiver of pre-deposit of service tax amounting to Rs. 78,27,798/- demanded by the Commissioner alongwith penalty of Rs. 25,26,701/-. The denand is for the period from July, 2002 to March, 2006. The issue involved viz., whether, service tax is payable on the value of SIM cards for the period July, 2002 to March, 2006 and whether service tax at the enhanced rate is liable to be paid in respect of vouchers and cards post paid, when there is a change in the rate of service tax during the period when the cards are sold and tax paid by the applicants and the date of actual rendering of service.
2. As regards the first issue, we find that the same is, prima facie, covered by the Tribunal's decision vide Order Nos. A/188-190/WZB/2007/C-I, dated 1-3-2007 [2007 (7) S.T.R. 440 (Tribunal)], wherein it has been held that once the sale tax is paid on SIM cards, service tax is not liable to be paid on the same. Since in the present case, sales tax has been paid on the SIM cards showing sale of goods, service tax cannot be demanded on the cards as the two are mutually exclusive.
3. As regards the other issue regarding payment of differential tax on account of enhancement in the rate of tax from the date when the tax was actually paid by the applicants and the date on which the service is actually availed of, the ld. Advocate drew our attention to various Circulars of Board requiring them to pay service tax on receipt of payment which can be paid at the rate prevalent at the time of payment of tax only. We, however, find that the circulars are silent regarding the relevant date for the purpose of determining the rate of tax. Prima facie, it appears that the issue is arguable and no case has been made out for complete waiver. We, therefore, direct pre-deposit of Rs. 6 lakhs (Rupees Six Lakhs) towards Service tax on this issue, within a period of eight weeks from today, and report compliance by 14-6-07. On such deposit, there shall be waiver of pre-deposit of balance amount of Service tax and penalty and stay recovery thereof till the disposal of the appeal.