Custom, Excise & Service Tax Tribunal
Krishi Upaj Mandi Samiti vs Commissioner, Central Excise And ... on 4 August, 2021
Author: Dilip Gupta
Bench: Dilip Gupta
CUSTOMS, EXCISE & SERVICE TAX APPELLATE
TRIBUNAL
NEW DELHI
PRINCIPAL BENCH
SERVICE TAX APPEAL NO. 53409 OF 2018
(Arising out of Order-in-Appeal No. 172(AG)/CE/JDR/2018 dated 21.03.2018 passed
by the Commissioner (Audit), Central Goods & Service Tax, Jodhpur)
M/s Krishi Upaj Mandi Samiti ........Appellant
Baran
Versus
Commissioner, CGST .......Respondent
& Central Excise Division,
Udaipur
APPEARANCE:
Ms. Bhanu Shree Jain, Advocate for the Appellant
Dr. Radhe Tallo, Authorized Representative for the Department
CORAM :
HON'BLE MR. JUSTICE DILIP GUPTA, PRESIDENT
HON'BLE MR. P.V. SUBBA RAO, MEMBER (TECHNICAL)
Date of Hearing: July 30, 2021
Date of Decision: August 04, 2021
FINAL ORDER No. 51698/2021
JUSTICE DILIP GUPTA :
M/s. Krishi Upaj Mandi Samiti Baran 1 has sought the quashing of
the order dated 21.03.2018 passed by the Commissioner (Audit),
Central Goods and Service Tax (Audit) Commissionerate, Jodhpur 2, by
which the appeal has been partially allowed to the extent that the
demand with the statutory interest for the period 01.04.2012 to
1 the appellant
2 the Commissioner (Appeals)
30.06.2012 has been confirmed but the demand for the period after
01.07.2012 has been dropped.
2. The appellant was established by the Rajasthan State
Government under the provisions of The Rajasthan Agriculture Produce
Markets Act, 1961. To fulfill the obligations of providing necessary
facilities of marketing of agricultural produce cast upon the appellant,
the appellant let out shops or godowns within the market area and
collected an allotment fee from the merchants or agriculturalists.
3. It is the collection of this amount that led to the issuance of a
show cause notice dated 08.05.2014. The show cause notice mentions
that the appellant had rented out its immovable properties to various
business firms/individuals on periodical rent/lease amount and the
services provided by the appellant would fall under the category of
'renting of immovable properties' defined under section 65(90a) of the
Finance Act, 1994 3 and made taxable w.e.f. 01.06.2007 under section
65(105)(zzzz) of the Finance Act. The relevant portion of the show
cause notice is reproduced below:
"2. Whereas, it has been gathered that the noticee had
rented out its immovable properties to various business
firms/individuals for furtherance of their business on periodical
rent/lease amounts. The service provided by the notice against
receipt of certain amount falls under the category of "Renting of
Immovable Property" Service and the amount so received is
forming part of the taxable value w.e.f. 01.06.2007.
6. *******
The notice collected an amount of Rs. 82,67,227/- from the
business firms/individuals client as 'Allotment Fee' but on the
said amount no Service Tax has been paid by them, thus, they
appear to have evaded the Service tax amounting to Rs.
10,21,829/- (Service Tax Rs. 9,92,067/- + Education Cess Rs.
19,841/- + SHE Cess Rs. 9,921/-) during the period from
01.04.2012 to 31.03.2013 (As shown in the Annexure "A"),
9. Now, therefore M/s Krishi Upaj Mandi Samiti, Baran
hereby called upon to show cause to the Additional
Commissioner Central Excise Commissioner-I, N.C.R. Building,
Statue Circle, Jaipur-302005 (Rajasthan) within 30 days from
the receipt of this show cause notice as to why:-
(i) Service Tax amounting Rs. 10,21,829/- (Service
tax Rs. 9,92,067/- + Education Cess Rs. 19,841
+ SHE Cess Rs. 9,921/-) should not be
3 the Finance Act
demanded and recovered from them under
Section 73(1) of the Finance Act, 1994;
(ii) Interest at the appropriate rate should not be
recovered from them under Section 75 of the Act
ibid; and
(iii) Penalty should not be imposed upon the provision
of Section, 76 and 77 of the Finance Act, 1994
for contravention of Section 68, 69 & 70 of the
Finance Act of the Finance Act, 1994 read with
Rule 4, 6 & 7 of the Service Tax, 1994.
4. The appellant filed a reply, denying the allegations made in the
show cause notice. The Adjudicating Authority, however, by order
dated 29.12.2016 confirmed the demand with interest and penalty.
5. Feeling aggrieved, the appellant filed an appeal and, as noticed
above, the Commissioner (Appeals) partially allowed the appeal. The
relevant portion of the order passed by the Commissioner (Appeals) is
reproduced below:
"8. I find that in the appeal, the adjudicating authority vide
impugned order has confirmed service tax demand on renting
of immovable property, wherein period of demand is from
1.4.2012 to 31.3.2013. As held by Hon'ble Tribunal, there is no
service tax liability after 01.07.2012. Following the judicial
discipline, I am inclined to conclude that the appellant's renting
of immovable property services provided to brokers/traders for
agriculture purpose fall under clause (d) of Negative List
specified under Section 66(D) of the Finance Act, 1994. I
therefore hold that they are not liable to pay service tax
on renting of immovable property services provided to
brokers/traders after 1.7.2012. However, the appellant has
also provided renting of immovable property services to
brokers/traders before 01.07.2012 i.e. from 01.04.2012 to
30.06.2012, which attracted service tax as per rate prescribed
along with interest. The SCN has been issued on 8.5.2014,
within time limit of 18 months as the last date for filing ST3
returns for the period 1.4.2012 to 30.6.2012 was extended to
25.11.2012 and therefore the demand is not time barred. I
refrain from imposing any penalty on the appellant as the issue
was of interpretation of benefit of a notification and tribunal in
has its order dated 25.02.2017 already held that there was no
malafide Act on part of the appellant to evade Service Tax.
9. In view of above, I partially allow the appeal filed by the
appellant to the extent mentioned above and confirm the
demand along with statutory interest for the period 1.4.2012 to
30.6.2012. Held accordingly.
6. Ms. Bhanu Shree Jain learned counsel appearing for the
appellant made following submissions:
i. The normal period of limitation for the rising demand for non-
payment of service tax as per section 73 of the Finance Act for
the period 01.04.2012 to 28.05.2012 is one year from the
relevant date. In the present case, the relevant date is the due
date of filing of return i.e. 25.11.2012. Thus, the period of
limitation will expire on 25.11.2013. The impugned show cause
notice has been issued on 08.05.2014. Thus, the demand raised
for the period 01.04.2012 to 28.05.2012 is barred by limitation;
and
ii. Section 73(1) of the Finance Act was amended with effect from
28.05.2012 and the period of limitation was extended to 18
months. It is settled law that the amendment in the period of
limitation cannot revive a dead claim. Thus, the demand for the
period 01.04.2012 to 28.05.2012 will be governed by the period
of limitation existing before amendment.
7. Dr. Radhe Tallo learned Authorized Representative appearing for
the Department, however, supported the impugned order.
8. The submissions advanced by learned counsel for the appellant
and the learned Authorized Representative of the Department have
been considered.
9. Section 73(1) of the Finance Act deals with recovery of service
tax not levied or paid or short-levied or short-paid or erroneously
refunded. This section, as it stood prior to 28.05.2012, is reproduced
below:
"SECTION 73. Recovery of service tax not levied or paid
or short-levied or short-paid or erroneously refunded. --
(1) Where any service tax has not been levied or paid or has
been short-levied or short-paid or erroneously refunded,
Central Excise Officer may, within one year from the
relevant date, serve notice on the person chargeable with the
service tax which has not been levied or paid or which has been
short-levied or short-paid or the person to whom such tax
refund has erroneously been made, requiring him to show
cause why he should not pay the amount specified in the
notice:
Provided that where any service tax has not been levied or paid
or has been short-levied or short-paid or erroneously refunded
by reason of --
(a) fraud; or
(b) collusion; or
(c) wilful mis-statement; or
(d) suppression of facts; or
(e) contravention of any of the provisions of this Chapter or of
the rules made thereunder with intent to evade payment of
service tax, by the person chargeable with the service tax or his
agent, the provisions of this sub-section shall have effect, as if,
for the words "one year", the words "five years" had been
substituted."
10. The aforesaid section 73(1) was amended w.e.f. 2805.2012 and
the period of "one year from the relevant date" was amended to
"eighteen months from the relevant date".
11. There is no dispute that the relevant date in the present case is
25.11.2012. Prior to this date on 28.05.2012, section 73(1) of the
Finance Act was amended and it was provided that the Central Excise
Officer could issue a notice within eighteen months from the relevant
date. The show cause notice was issued on 08.05.2014, which would
be within eighteen months from 25.11.2012.
12. The Commissioner (Appeals), therefore, committed no illegality
in holding that the demand for the period 01.04.2012 to 30.06.2012
was within the statutory period of eighteen months from the relevant
date.
13. There is, therefore, no illegality in the impugned order dated
21.03.2018 passed by the Commissioner (Appeals). The appeal is,
accordingly, dismissed.
(Order pronounced on 04.08.2021)
(JUSTICE DILIP GUPTA)
PRESIDENT
(P V SUBBA RAO)
MEMBER (TECHNICAL)
Shreya
CUSTOMS, EXCISE & SERVICE TAX APPELLATE
TRIBUNAL
NEW DELHI
PRINCIPAL BENCH
SERVICE TAX APPEAL NO. 53409 OF 2018
(Arising out of Order-in-Appeal No. 172(AG)/CE/JDR/2018 dated 21.03.2018 passed
by the Commissioner (Audit), Central Goods & Service Tax, Jodhpur)
M/s Krishi Upaj Mandi Samiti ........Appellant
Baran
Versus
Commissioner, CGST .......Respondent
& Central Excise Division,
Udaipur
APPEARANCE:
Ms. Bhanu Shree Jain, Advocate for the Appellant
Dr. Radhe Tallo, Authorized Representative for the Department
CORAM:
HON'BLE MR. JUSTICE DILIP GUPTA, PRESIDENT
HON'BLE MR. P. ANJANI KUMAR, MEMBER (TECHNICAL)
Date of Decision: August 04, 2021
ORDER
Order pronounced.
(JUSTICE DILIP GUPTA) PRESIDENT (P. ANJANI KUMAR) MEMBER (TECHNICAL) Shreya