Custom, Excise & Service Tax Tribunal
M/S. Convergeon Hr Services (India) ... vs The Commissioner Of Service Tax on 25 June, 2012
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
SOUTH ZONAL BENCH AT BANGALORE
Bench - Division Bench
Court - I
Date of Hearing: 25.06.2012
Date of decision: 25.06.2012
Stay Application No. 570/2010
Service Tax Appeal No. 1022/2010
(Arising out of Order-in-Original No. 06/2010 dated 19.02.2010 passed by the Commissioner of Service Tax, Bangalore)
For approval and signature:
Honble Mr. P.G. Chacko, Member (Judicial)
Honble Mr. M. Veeraiyan, Member (Technical)
1. Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
Yes
3. Whether their Lordship wish to see the fair copy of the Order?
Seen
4. Whether Order is to be circulated to the Departmental authorities?
Yes
M/s. Convergeon HR Services (India) Pvt. Ltd. ..Appellant
Vs.
The Commissioner of Service Tax
Bangalore Respondent(s)
Appearance Mr. K. S. Naveen Kumar & Mr. Ramnath, Advocates for the appellant Mr. Ganesh Haavanur, Additional Commissioner (AR) for the Revenue Coram:
Honble Mr. P.G. Chacko, Member (Judicial) Honble Mr. M. Veeraiyan, Member (Technical) STAY ORDER No._______________________2012 FINAL ORDER No._______________________2012 [Order per: P.G. Chacko]. This application filed by the appellant seeks waiver of pre-deposit and stay of recovery in respect of the adjudged dues which include an amount of Rs. 58,44,083/- demanded from them as service tax and education cesses under the head Manpower Recruitment or Supply Agency Service for the period from 16.06.2005 to 10.02.2009. The learned counsel for the appellant submits, at the outset, that they have paid an amount of over Rs. 20 lakhs towards the impugned demand and further that they could not reply to the relevant show-cause notice and could not attend personal hearing and consequently an ex parte order happened to be passed against them. On a perusal of the records and considering the submissions of both sides, we are of the view that this case is fit for remand to the adjudicating authority. Accordingly, after dispensing with pre-deposit, we take up the appeal.
2. This appeal is directed against the order passed by the learned Commissioner of Service Tax against the assessee ex parte in adjudication of show-cause notice dated 14.09.2009 issued by the DGCEI. The show-cause notice had demanded the aforesaid amount from the assessee towards service tax and education cesses for the aforesaid period by invoking the proviso to Section 73 (1) of the Finance Act 1994. It had also demanded interest thereon under Section 75 of the Act, besides proposing penalties on the party under Sections 76 to 78 of the Act. It also proposed that an amount of Rs. 20,06,706/- reportedly paid voluntarily by the party be appropriated towards the above payment. The show-cause notice granted 30 days time from the date of its receipt by the noticee for filing reply. Before waiting for this period to run out, a Superintendent in the office of the adjudicating authority issued a hearing notice dated 08.10.2009 to the party stating that the Commissioner had fixed the date of personal hearing to be 15.12.2009 (11 a.m.), failing which 16.12.2009 (11 a.m.), failing which 17.12.2009 (11 a.m.). The noticee apparently neither replied to the show-cause notice nor responded to the said hearing notice for quite some time. Ultimately, on 17.12.2009, they wrote to the Superintendent for grant of time up to 15.01.2010 for filing a reply to the show-cause notice. This request was received by the Superintendent on the same date. Even subsequently, it appears, there was no attempt by the party to file a reply to the show-cause notice or to enquire about adjudication of the matter. They did not file any reply to the show-cause notice till the date of passing of the impugned order by the Commissioner. In the impugned order, the Commissioner noted the circumstances as follows:
Till date, I find that the assessee failed to file any reply to the show-cause notice. The persona hearing was fixed on 15.12.2009, 16.12.2009 and 17.12.2009, which was intimated to the assessee under letter C No. IV/16/109/2009 ST Adjn. dt. 08.10.2009, requesting them to also file their reply to the show-cause notice, on or before the personal hearing. However, as the assessee failed to file any reply to the show-cause notice and also failed to avail of the three opportunities of being heard, provided to them, I find that sufficient opportunity has been provided to them in terms of Section 33A of the Central Excise Act, 1944, made applicable to service tax vide Section 83 of the Finance Act, 1994. Under the circumstances, inevitably, the issue here is to be decided ex parte.
3. It is the case of the appellant as sought to be made out by their counsel today that natural justice was not rendered to them by the adjudicating authority in the aforesaid facts and circumstances. We have heard the learned Additional Commissioner (AR) also who opposes the above plea by reiterating para 18 of the impugned order.
4. After giving careful consideration to the submissions, though we are not impressed with the plea of negation of natural justice in the manner sought to be made to us, we are inclined to remand this case for the ends of justice. There are more reasons than one for taking this view. Firstly, it is not in dispute that a notice of personal hearing was issued to the appellant before expiry of the time given to them for filing a reply to the show-cause notice. That notice fixed 17.12.2009 as deadline for personal hearing. On that very date, the appellant made a request to the adjudicating authority for grant of time till 15.01.2010 for filing a reply to the show-cause notice. This request of the party was acknowledged on the same date. But, in para 18 of the impugned order, wherein the adjudicating authority considered the relevant circumstances and recorded the view that sufficient opportunity had been provided to the party under the relevant statutory provisions to be personally heard, there is no reference to the above request dated 17.12.2009 of the appellant. The learned Commissioner should have considered their request for a short time more for filing a reply to the show-cause notice and should not have shown such a haste to pass an order ex parte. Secondly, the show-cause notice itself stated the voluntary payment of an amount of Rs. 20 lakhs by the noticee and also proposed its appropriation. The adjudicating authority should have verified this aspect, but the impugned order indicates that no attempt was made for this purpose. Before us, there are TR-6 challans filed by the appellant undertaking three payments made on 16.03.2007, 17.03.2007 and 16.09.2008 totaling to Rs. 20,06,706/-. Prima facie, this payment can be accepted as pre-deposit preparatory to the remand of the case.
5. The role of natural justice demands that a reasonable opportunity be given to the aggrieved party. The facts and circumstances narrated above indicate that an opportunity of this kind was not given to the party. Therefore, we are inclined to set aside the impugned order for the purpose of remand of the case for de novo adjudication. It is ordered accordingly. The appellant shall appear before the Commissioner with a reply to the show-cause notice at 11 a.m. on 13.08.2012 and shall duly attend his proceedings on such dates as may be fixed by the Commissioner. Needless to say that the appellant shall be given a reasonable opportunity of being heard on all the issues and that a speaking order shall be passed by the learned Commissioner.
6. The appeal stands allowed by way of remand. The stay application also stands disposed of.
(Pronounced & dictated in open Court)
(M. VEERAIYAN) (P.G. CHACKO)
MEMBER (TECHNICAL) MEMBER (JUDICIAL)
iss