Custom, Excise & Service Tax Tribunal
Cce, Lucknow vs M/S Kohli Brothers Labs Pvt. Ltd on 25 October, 2012
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
West Block No. 2, R.K. Puram, New Delhi 110 066.
Date of Hearing : 25.10.2012
Service Tax Appeal No. 808 of 2008
{Arising out of Order-in-Appeal No. 90-CE/LKO/08 dated 30.9.2008 passed by the Commissioner (Appeals), Central Excise & Service Tax, Lucknow}
For Approval &signature :
Honble Ms. Archana Wadhwa, Member (Judicial)
HonbleShri Mathew John, Member (Technical)
1. Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2. Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3. Whether their Lordships wish to see the fair copy of the order?
4. Whether order is to be circulated to the Department Authorities?
CCE, Lucknow Appellant
Vs.
M/s Kohli Brothers Labs Pvt. Ltd. Respondent
Appearance:
Appeared for Appellant : Shri V. Batra, A.R.
Appeared for Respondent : Shri Amit Awasthi, Advocate
CORAM: Honble Ms. ArchanaWadhwa, Member (Judicial)
Honble Shri Mathew John, Member (Technical)
Order No.dated.
Per Mathew John :
The respondents were providing photography services made taxable under Section 65(105)(zb) of the Finance Act, 1994 and were duly registered with the service tax department. However, for services provided during the period July 2001 to March 2005 the respondent did not pay service tax which was due and also did not file ST-3 returns as prescribed in the Service Tax Rules. Later they filed ST-3 returns with a considerable delay. Further, while paying service tax they did not include the value of consumable photographic chemicals used for providing the service. Therefore, Revenue made out a case that there had been suppression of taxable value of service and consequent short payment of service tax and there was delay in payment of service tax and also in filing the returns.
2. A Show Cause Notice issued in this regard resulted in confirmation of service tax payment amounting to Rs.11,35,904/- along with interest and penalties under Section76, 78 and 77 of Finance Act, 1994. On appeal, the Commissioner (Appeals) dropped the demand of service tax of Rs.11,35,904/-. Aggrieved by the order of the Commissioner (Appeals) the Revenue has filed this appeal.
3. The ld. A.R. for Revenue submits that without using the consumables the service of photography could not have been provided and since the respondent did not include the value of such chemicals on the taxable value there has been suppression of information by the respondent and the extended period was correctly invoked while confirming the demand.
4. He also points out that the issue whether value of materials consumed formed part of the taxable value of such service is decided by the Larger Bench of the Tribunal in the case of Aggarwal Colour Advance Photo System Vs. CCE 2011 (23) STR 608 (Tri.-LB). Therefore he submits that the order of the Commissioner (Appeals) is wrong and needs to be reversed.
5. Opposing the prayer of Revenue, ld. Counsel for Respondent submits that though it has been decided by the Larger Bench of the Tribunal in the case of Aggarwal Colour Advance Photo System (supra) that value of consumables would form part of taxable value it is also decided by the Tribunal in the case of CCE Vs. Satyam Digital Photo Lab 2012 (27) STR 64 (Tri.-Del.) that the extended period of time cannot be invoked for confirmation of demand in such cases, in view of the fact that there were clarifications issued by the CBEC to the effect that value of consumables need not be added and also in view of various decisions of the Tribunal in this regard in favour of the assesses till pronouncement of the decision in the case of Aggarwal Colour Advance Photo System.
6. Considered submissions on both the sides. The merits of issue involved in this case is already decided by the Larger Bench of the Tribunal and the same will be applicable. However, the time limit for demanding of service tax will be limited to one year from the relevant date has specified in Section 73 of Finance Act, 1994. So demand for a period of one year prior to the issue of notice decided having regard to definition of relevant date is sustainable. The case is remanded back to the adjudicating authority for quantifying the demand that would fall within the period of one year from the date of issue of SCN to be determined considering the definition of relevant date in section 73 of Finance Act, 1994. The penalties will are also to be re-adjudicated by the authority.
(Pronounced in Court)
(Mathew John) (Archana Wadhwa)
Member (Technical) Member (Judicial)
RM