Customs, Excise and Gold Tribunal - Delhi
G.M. Telecom Bsnl vs Cce on 2 June, 2003
Equivalent citations: 2003(88)ECC805, 2003(160)ELT318(TRI-DEL), 2006[3]S.T.R.122, [2007]9STT112
JUDGMENT
K.K. Usha, J. (President)
1. This is an appeal at the instance of the General Manager Telecom BSNL, Amritsar challenging the order passed by the Commissioner (Appeals), Chandigarh dated 26.11.2001. Under the above order the Commissioner confirmed the order passed by Additional Commissioner (Preventive) demanding an amount of Rs. 15,69,132 as interest on delayed payment of service tax for the period August 1994 to March 1999. Commissioner (Appeals) rejected the contention raised by the appellant that service tax alongwith the amount due under the bill of each subscriber was being paid to the account of the Central Government on day-to-day basis at the close of each working day and merely because there is a delay in crediting the service tax by way of a book transfer to the book account of the Central Government under head 0044 will not make the appellant liable for interest. Aggrieved by the above, the General Manager Telecom has come up in appeal.
2. It is contended by the learned counsel for the appellant that they were following the procedure prescribed in the matter of payment of the bill amount alongwith service tax prescribed by the Department of Telecom Headquarters in consultation with the Principal Chief Controller of Accounts, Central Board of Excise & Customs, New Delhi. Such procedure was being followed throughout the country. Telephone charges alongwith service tax is being received by the village post office from the subscriber. It is then sent to the Head Post Office. By 10th of next month a statement is prepared by the Head Post Office and sent to General Manager Telecom, Amritsar. From there the statements are reconciled and segregation between telephone charges and service tax is also made by 25th of next month and the statement is sent to DOT New Delhi. Till a circular was issued in October 1998, the General Manager Telephones had no authority to straightaway pay the service tax to the Excise Department. Once the statement is obtained by DOT they await for the payment from all districts of Punjab. DOT thereafter make a statement State-wise and Book Entry is made in favour of the Govt. of India. This procedure certainly involved delay. Pursuant to a circular dated issued in 1998 General Manager got authority to pay service tax directly. The circular was brought to the notice of all concerned and thereafter, payment is being made without delay. It is the submission of the appellant that from March 1999 onwards the new procedure is followed and there is no delay in making the book entry. Under these peculiar circumstances, the appellant would submit that he should not have been directed to pay interest for the delayed payment during the relevant period.
3. The learned counsel for the appellant brought to our notice and order wherein a similar demand for interest for delayed payment of service charges by Tirunelveli Telecom District Manager, was dropped by the Assistant Commissioner, Tirunelveli Division accepting the explanation offered as in the persent case. He has also pointed out that the very same Commissioner (Appeals) who had passed the order impugned has accepted identical contentions raised by General Manager Telecommunication Ltd. Ludhiana in his order dated 5.9.2000 and set aside the order passed by the original authority directing payment of interest. The learned counsel, therefore, submits that there is no justification whatsoever to take a different view in the present proceedings against the appellant specially when the Revenue has not challenged the earlier orders, as mentioned above.
4. The learned DR would submit that even if the officers had taken a wrong view in the earlier proceedings, it should not stand in the way of the Commissioner (Appeals) passing an order in accordance with law. He contended that the liability to pay interest under Section 75 of the Finance Act, 1994 is mandatory and that the adjudicating authority has no discretion to exempt from payment of interest when there is a delay in payment of service tax. He also contended that unless the amount is credited to the book account of Central Government under the head 0044 prescribed for payment of service tax it cannot be taken that payment has been made by the appellant. Therefore, the Commissioner (Appeals) was fully justified in sustaining the demand of interest.
5. The appellant is a Department of Central Government. It is bound to make payment including crediting of the amount received from the subscribers towards the telephone charges and service tax in accordance with the directives given by the Chief Controller of Accounts. It is the case of the appellant that they were strictly following the procedure prescribed by DOT Headquarters in consultation with the Principal Chief Controller of Accounts and the Central Board of Excise & Customs. This procedure was followed till March 1999. Thereafter the General Manager is directly crediting the service tax to the book account of the Central Govt. under the head 0044 in view of a circular issued in the year 1998. Thus the delay caused by the statement being sent to DOT Headquarters is avoided. In the peculiar facts and circumstances of this case where the appellant is a Central Government Department and that it had been strictly following the procedure approved by Principal Chief Controller of Accounts and which procedure has resulted in the delay and the fact that the amount received from the subscribers were deposited on a day to day basis in the Post Office to the account of the Central Government, we find that the appellant cannot be burdened with the liability to pay interest. We make it clear that this view is being taken only in the facts of this case where the delay is caused in depositing the service tax in the specific account of the Central Government by none other than a department of the Central Government and also because of the fact that the amount was deposited in the account of the Central Government on a day to day basis. We, therefore, set aside the order impugned and allow the appeal.