Custom, Excise & Service Tax Tribunal
Airport Authority Of India Ltd vs Commissioner Of Central Excise &Amp; ... on 6 July, 2018
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E/52875 & 52521/2015
IN THE CUSTOMS, EXISE AND SERVICE TAX APPELLATE
TRIBUNAL, NEW DELHI, PRINCIPAL BENCH NEW DELHI
Date of Hearing: 13.06.2018
Date of Decision: 06.07.2018
Appeal No. ST/52875 & 52521/2015
[Arising out of Order-in-Original No. 11-12/AKJ/ST-I/2015
dated 02.03.2015 passed by the Commissioner of Service
Tax (Adjudication), New Delhi]
Airport Authority of India, & CCE Delhi ...Appellant
Vs.
CCE, Delhi, & Airport Authority of India ...Respondent
Appearance:
Represented by Shri Anil Kumar Kathuria, Advocate for the Appellant.
Represented by Shri Amresh Jain, D.R. for the Respondent. Coram:
Hon'ble Mr. V. Padmanabhan, Member (Technical) Hon'ble Ms. Rachna Gupta, Member (Judicial) Final Order No. 52455-52456/2018 Per V. Padmanabhan:
The Order in Original No. 11-12/2015 dated 27.02.2015 is under challenge. The assessee as well as Revenue have challenged different portions of the impugned order.
2. The assessee is registered centrally with the Service Tax Commissionerate, Delhi for providing Airport Services as well as various other services. A special audit of the accounts of assessee was ordered in terms of Section 72A 2 E/52875 & 52521/2015 of the Finance Act. The audit covered the period 2008-09 to 2011-12. After receipt of the report of the Special Auditor, the Department issued Show Cause Notice dated 22.04.2014 alleging that the assessee has failed to pay Service Tax under various categories of service. After receipt of the Special Audit Report and the Show Cause Notice, the assessee admitted the liability of Service Tax and paid up differential Service Tax amounting to Rs. 62,83,60,922/- for the period covered by the special audit. Further, the assessee also discharged the interest liability amounting to Rs. 1,54,07,921/- under Section 75 of the Act. The adjudicating authority confirmed the tax liability already admitted by the assessee and appropriated the Service tax as well as interest paid by the assessee. However, he refrained from imposing any penalty under various Sections of the Finance Act proposed in the Show Cause Notice. Revenue has filed the appeal on the ground that penalties under various Sections are liable to be imposed, since the adjudicating authority has upheld the demand of Service Tax on the ground of alleged suppression.
3. Show Cause Notice dated 23.05.2014 was issued for the period 2012-13. This Show Cause Notice was issued on the same grounds as the Show Cause Notice dated 22.04.2014, but for the period of one year subsequent to 3 E/52875 & 52521/2015 the period covered under special audit. In the impugned order Service Tax liability amounting to Rs. 1,37,40,601/- was upheld along with interest and also penalties under various Sections of the Act. This levy of Service Tax has been challenged by the assessee.
4. With the above background, we heard Shri A.K. Kathuria, learned Advocate for the assessee as well as Shri Amresh Jain, learned D.R. representing Revenue.
5. At the outset, we consider the appeal filed by the Revenue for a decision. The learned D.R. submitted that since the adjudicating authority has upheld the demand by invoking to the extended period of limitation under Section 73, he should have also imposed a penalty under various Sections. Countering the above argument, the learned Counsel for the assessee submitted that the adjudicating authority has refrained from imposing penalty since the entire Service Tax liability along with interest has already been paid even before the issue of Show Cause Notice. In this connection, he relied on the decision of the Tribunal in respect of the same assessee for a different period, vide Final Order No. 52501/2017 dated 20.03.2017.
6. It is not in dispute that the entire amount of Service Tax for the disputed period stands paid by the assessee along with the full interest liability, even before the issue of Show Cause Notice. The Tribunal in the decision relied by 4 E/52875 & 52521/2015 the assessee, has waived the penalty in similar circumstances. We reproduce below the observations of the Tribunal:
"3. The ld. Commissioner has invoked Section 80 ibit for non-imposition of penalty under Section 76, 77 and 78. He has recorded the following findings in the impugned order:-
"18.3 M/s. AAI has contended that there was no deliberate withholding of information or suppression of facts and they are a Public Authority under the Central Government and there is no personal gain or guilty intention to evade any tax. The non-payment was on account of ignorance and the mistake was corrected as soon as it was brought to their notice. I find that M/s. AAI is a Department of the government of India and no personal interest of any individual is involved in nonpayment of tax or non- compliance of legal requirement deliberately. It is viewed that being a government undertaking, there is absence of personal gain for an individual and it cannot be held that there was a suppression or willful misstatement or contravention of the provisions of law with the guilty intentions.5
E/52875 & 52521/2015 18.4 Since M/s. AAI have discharged their liability of the service tax alongwith the interest before the issuance of Show Cause Notice, I hold that all the proceedings under any of the provision of the act shall come to an end and no penalty under any of the section can be imposed on them as per the undertakingal Circular No. 137/167/2006-CX-4 dated 03/10/2007. It is clear in terms of Section 73(3) that no show cause notice is warranted in the case if the duty is deposited prior to the issuance of the show cause notice in terms of aforesaid sub-section of the Act, and as such no penal action is required"
4. On going through the adjudicating order, we find that there is no element of suppression on the part of the appellant in defrauding the service tax. On pointing out the mistake that the appellant is liable to pay service tax, the amount of service tax in question was deposited by the appellant with interest. Thus, in terms of sub-section (3) of Section 73 ibid, there was no necessity for issuance of show cause notice, only for imposition of penalty."
7. By following the earlier order of the Tribunal, we dismiss the appeal filed by the Revenue.
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E/52875 & 52521/2015
8. Next, we turn to the appeal filed by the assessee, in relation to the demand upheld with respect to the Show Cause Notice dated 23.05.2014. The learned Counsel for the assessee submitted that the demand has been raised on the service charges allegedly collected by the assessee on electricity bills. He submitted that for the period covered by the special audit, the assessee had recovered „service charges‟ on the electricity bill from the concessionaires of the assessee in the airport area. The Service Tax charged in the earlier Show Cause Notice on such service charges also has been paid by the assessee. He submitted that the assessee changed its practice and stopped collection of service charges for the subsequent period. He argued that the demand has been raised without any documentary basis, but has been estimated under Section 72 of the Act by "Best Judgment". He submitted that they have already submitted copies of the bill raised for some of the concessionaires to support the argument with no service charges were levied by the assessee. He also submitted in affidavit executed by the General Manager (Finance) of Airport Authority of India, New Delhi to the effect that no service charge on electricity has been recovered after the special audit period. Accordingly, he submitted that the demand merits to be set aside.
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E/52875 & 52521/2015
9. The learned D.R. opposed the contention of the assessee. He submitted that in spite of repeated correspondence, the assessee has not cooperated with the Department by supplying the relevant documents and hence, the Department had to take recourse to the best judgment assessment under Section 72. He also pointed out that the copies of the bills submitted by the learned Counsel were not for the period covered within the Show Cause Notice dated 23.05.2014 and hence, not relevant. Finally, he argued that the assessee has failed to establish that no service charge was covered during the period 2012- 13 and hence, the demand may be upheld.
10. After hearing both sides and perusal of the record, we note that the demand stands raised under the category of "Business Support Services" on the commission allegedly received by the assessee on top of electricity charges recovered from the concessionaire. The claim of the assessee is that the practice of recovery of service charges was stopped by them and no such charges were recovered for the period 2012-13 covered by Show Cause Notice dated 23.05.2014. When a similar argument was raised before the adjudicating authority, he has recorded in Para 5.2.6 of the impugned order that the assessee has failed to provide the correct figures of taxable value and the amount 8 E/52875 & 52521/2015 of Service Tax liability. Hence, he has declined to entertain the arguments of the assessee.
11. Even during the course of argument of this appeal also, we note that no documentary evidence stands submitted regarding the claim that no service charge has been recovered during the period 2012-13. However, an affidavit stands filed by the authorized signatory of Airport Authority of India to the effect that no such service charges have been recovered. In view of the above, we set aside the portion of the impugned order relating to the Show Cause Notice dated 23.05.2014 and remanded the matter to the adjudicating authority for a de-novo decision on the subject. He is directed to consider the claim of the assessee that no such service charges have been recovered, if supported by documentary evidence.
12. In view of the above, the appeal filed by the Revenue is rejected and the appeal filed by the assessee is allowed by way of remand.
[Pronounced in open court on 06.07.2018] (Rachna Gupta) (V. Padmanabhan) Member (Judicial) Member (Technical) RN