2013 (7) TMI 666 - AT - Service Tax

Revenue's Appeal Dismissed on Service Tax Liability; Emphasis on Judicial Coherence in Tax Laws

Commissioner of Service Tax, Rajkot Versus M/s. SKSE. Securities Limited

The appeal by Revenue against the order of the Commissioner (Appeals) Customs & Central Excise, regarding alleged under-declaration of service tax ... Differential income on stock broking – revenue contended that there was differential income on account of assessee during the year - The adjudicating authority critically examined the defence of the assessee and made a detailed assessment of the material on record and came to the conclusion that the lapse of the assessee is not intimating payments made by his sub-brokers in ST-3 returns was mere technical flaw and no demand could be raised on the assessee on this count, since the resultant service tax was already remitted - Held that :- Present appeal had been filed without any justification - no infirmity in the order of the adjudicating authority as confirmed by the order of the Commissioner (Appeals) - once the Tribunal had pronounced on an aspect having a clear and direct application in a subsequent case - such judgment absent any overarching norm by any superior court must constitute the non-derogable norm in conformity with which subsequent assessment or adjudication should proceed – recidivist and futile endeavours by Revenue for utopian perfection tends to undermine the stability of law and impose wholly avoidable litigation costs - appeal decided against revenue. Issues:1. Appeal against order of Commissioner (Appeals) Customs & Central Excise.2. Alleged under-declaration of service tax liability by the respondent.3. Assessment of service tax liability on Stock Broking services.4. Defence of the assessee regarding remittance of service tax by sub-brokers.5. Adjudication order findings on the service tax liability and penalties.6. Appeal by Revenue against the adjudication order.7. Decision of the appellate Commissioner based on the Larger Bench ruling.8. Grounds of appeal not challenging the Larger Bench ruling.9. Judicial coherence in fiscal legislation and stability of law.10. Dismissal of the appeal and imposition of costs on Revenue.Analysis:1. The appeal was filed by Revenue against the order of the Commissioner (Appeals) Customs & Central Excise, Rajkot, alleging under-declaration of service tax liability by the respondent related to Stock Broking services for the period March 2005 to March 2007.2. The respondent contended that the service tax was remitted by sub-brokers working under the principal Broker as per SEBI guidelines, and there was no short remittance of tax. The adjudicating authority found a technical flaw in the non-intimation of payments made by sub-brokers but concluded there was no demand due to the already remitted service tax, except for a small amount of Rs. 1,978/- due to arithmetical calculation.3. Revenue appealed the adjudication order, but the appellate Commissioner rejected the appeal citing the decision of the Larger Bench of the Tribunal in a similar case. The ruling emphasized that service tax was not remittable again by the principal stock broker for services already taxed by sub-brokers, ensuring single point taxation.4. The appeal did not challenge the Larger Bench ruling, highlighting the importance of judicial coherence in fiscal legislation. The Tribunal emphasized that once a clear judgment is given on an aspect, it should be followed in subsequent cases to avoid unnecessary litigation costs and ensure stability of law.5. The Tribunal found no justification for the appeal and dismissed it, imposing costs of Rs. 1,000/- on Revenue for causing unjustified litigative trauma to the respondent. The order of the adjudicating authority, as upheld by the appellate Commissioner, was deemed appropriate and conclusive in the matter.