TaxTMI 
TaxTMI 
TaxTMI 
2008 (9) TMI 863
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....x raised in the Demand Notice and appropriated the same under Section 68 reads with Section 73 of the Act, along with interest which was also confirmed and appropriated under Section 75 of the Act, besides, imposing penalty under Section 76 read with Section 78 of the Act and further penalty of Rs. 1,000/- and Rs. 5,000/- under Section 77 of the Act holding that the charges leveled in the SCN are proved conclusively as agreed by them in the statement recorded under section 14 of the Central Excise Act. 2. Being aggrieved by the above order, the appellant has filed the present appeal along with application for stay of penalty. The contentions of the appellant are summarized as under :- (i) that the appellant is not providing, any services as covered by 'banking and other financial services' which fact has been ignored by the Assistant Commissioner, Satara; (ii) that the Assistant Commissioner has ignored the definition of 'banking and other financial services' given under Section 65(12) of the Act; (iii) that the Assistant Commissioner has failed to appreciate that the appellant was not issuing drafts or bankers cheques; (iv) that the appellant was issuing their cheques from th....
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....xable service; (xiv) that the Assistant Commissioner has failed to appreciate that no penalty has been proposed in the SCN for non-registration; (xv) that the Assistant Commissioner has failed to appreciate that there was no suppression of value of taxable service and therefore, no penalty was imposable under Sections 76, 77 of the Act. 3. PH was granted on 5-9-2008 at 11.30 AM. Shri V.Y. Khare, Company Secretary (practicing), duly authorized by the appellant appeared before me. During the hearing, in addition to reiterating the submissions made in the appeal memorandum, he filed a written submission along with sample copies of documents presenting the transactions of the appellant with the Bank i.e. AXIS Bank Ltd. wherein the appellant has got their account and other documents relating to the members of the society. 3.1 In the written submission, the following additional points were urged :- (i) that the documents relied upon by the Department particularly, the statement of Shri P.K. Barve was not attached with the SCN which violates the principle of natural justice; (ii) that the adjudicating authority has recorded his findings that the assessee was required to register und....
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....ng house and due to this reason, the appellant was not permitted to issue their own DDs etc. However, the appellant had a tie-up with other Bank organizations viz. UTI Bank, Ichalkaranji Janata Sahakari Bank and Syndicate Bank and the cheques of these Banks are being issued to their customers by the appellant. It was further alleged that the services of issue of cheques is provided under other Banking institution's name and accordingly, they are not eligible for exemption under Notification No. 6/2005-S.T., dated 1-3-2005. From the above, it is seen that the SCN has identified the appellant as 'a non-banking institution'. It is, therefore, necessary to see what is the meaning assigned to 'non-banking financial institutions'. Before seeing the definition of 'non banking financial institution', it has to be seen what is the definition available for a 'Banking and other Financial services" during the material period. (A) The definition for the period 10-9-2004 to 17-4-2006. "banking and other financial services" means - (a) the following services provided by a banking company or a financial institution including a non-banking financial company or any other body corporate or commerc....
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.... transfer, providing bank guarantees, overdraft facility, safe deposit locker, safe vaults, and operation of bank accounts which are regulated under RBI Act. In other words, for doing above service it is a mandatory requirement that the appellant works/governed under the RBI Act. But the appellant is not governed under RBI Act. In short, whatever the services mentioned in the definition available during the period from 10-9-2004 to 10/2006 cannot be linked to the appellant. 4.2 Though under the above definition, the activities of the appellant arc not coming under 'banking and other financial services', for academic interest, I would like to produce the meaning for 'non-banking financial company', since the SCN recognizes the services of the appellant as 'non-banking financial company' and the OIO also concludes that the charges mentioned in the SCN have been proved. The meaning of the 'non-banking financial company' is given under Section 45-I(f) of the Reserve Bank of India Act, 1934. "non-banking financial company" means : (i) a financial institution which is a company; (ii) a non-banking institution which is a company and which has as its principal business the receivi....