TaxTMI 
TaxTMI 
TaxTMI 
2014 (5) TMI 727
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.... October 2004 to March 2011. 4. The appellant/ assessee is engaged in providing various services which includes Security services, House Keeping Services, Fire Fighting Services, Utility Services, Customer care Services, Liftmen Service, Attendants, gardening, receptionist, management facilities, Cleaning services etc. The issues involved in the appeal ST/275/2011-Mum. and the remaining six appeals are over lapping and have implication on the six appeals and are therefore being taken up together. 5. ST/275/2011-Mum. Revenue took up the investigation against the appellant/assessee. Investigation which were extended to around 422 clients/customers of the appellant. After recording statement of 22 customers and procuring various documents from the 422 customers, as also documents recovered during the searches at the appellant/assessee premises, a demand notice amounting to Rs.2,04,62,708/- was issued on 21.4.2006 covering the period 1.2.2001 to 30.9.2004. This demand notice invoked the extended period of limitation. The case was adjudicated by the Commissioner vide impugned order dt. 31.1.2011 wherein the adjudicating authority confirmed the entire demand and penalty of equivalent ....
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....ontents therein. Learned Counsel further argued that the content of the minutes is of a nature which would be applicable even for the earlier period. The Learned Counsel further argued that keeping in view the fact that the appellant has not correctly indicated the value of the service provided to their clients or in some cases even though security services were provided but no tax was paid indicate clear cut suppression of facts with willful intention to evade payment of duty and extended period have been correctly invoked. On the valuation aspect Learned Counsel stated that the valuation of the security service is well settled by the decision of the Hon'ble Tribunal in the case of Punjab Ex-Servicemen Corporation Vs. CCE, Chandigarh reported in 2007 (5) STR 214 (Tri.-Del.) and the said decision of the Tribunal was based upon the Hon'ble Madras High Court decision in the case of GDA Security Pvt. Ltd. Vs. Union of India reported in 2006 (2) STR 542 (Mad.). Learned Counsel also argued the fact that the ONGC is not paying service tax to them cannot be a reason not to collect the tax from the appellant. Appellant/assessee cannot absolve itself of its liability to pay tax. In ....
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....rged will be the value. It is not in dispute that all the security guards were on the pay role of the appellant and various charges relating to provident fund, ESIC etc. were charged from their clients. We therefore find no merit in the said contention. As far as amounts received from ONGC is concerned, the fact that ONGC is not paying service tax to the appellant is of no consequence. As long as the appellant is providing the security service to ONGC, appellant is required to pay the said amount to the Government. Another contention is that some amount received from ONGC was relating to arrears. No details have been produced. The exact period to which the said amounts belongs and whether service tax has already been paid by the appellant on the said amount. Service tax is charged on receipt basis and security services were under tax net even before 2001. We also note that appellant was not declaring the value of the service tax correctly. It was based upon the painstaking exercise done by the Revenue covering 422 customers that the correct value of the services and the amount of service tax have been computed. This is a clear cut case of suppression of facts with willful intention....
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....n the three show cause notices dt. 23.4.2010, 15.10.2010, 21.10.2011 are concerned these were further examined and only a part of the demands were confirmed. Remaining demands were set aside on various grounds as detailed in the order. The main reason is that the department has issued the demand notices without examining the nature of services provided by the appellant/assessee. Department has not even examined whether the activities/services provided by the appellant/assessee are taxable or non-taxable and in case some of these are taxable under which category the same would fall. Commissioner found that in the first show cause notice dt. 23.4.2010 the allegation in regarding non-payment of service tax on 'Security Agency Services', 'Manpower Recruitment or supply Agency Services', 'Business Support Services and 'Cleaning Activity services' in the second and third SCN, non-payment of service tax has been alleged in respect of the Security Agency Services provided by the notice to SEZ and ONGC and on the taxable services provided under the category of Manpower Recruitment or Supply Agency. The Commissioner also found that the security Agency Service finds mention in the....
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....t/assessee during the personal hearing before the Commissioner agreed to pay service tax amounting to Rs. 3,59,53,895/- relating to cleaning service. Even though the demand raised in the show cause notice is not in respect of cleaning service but manpower supply service, Commissioner confirmed the demand relating to cleaning service as the appellant accepted that they were providing cleaning service and accepted the liability. Since the demand notice did not quantify about the said service the amount claimed by the appellant and duly certified by the Chartered Accountant was confirmed. Commissioner also accepted the appellants contention that the demand has been made on the gross turnover which is inclusive of service tax paid/payable which should have been excluded while computing the value of taxable service in respect of the amount relating to taxable activity. Commissioner also confirmed the interest liability in respect of the demand so confirmed. As far as penalties under different provisions of law are concerned no penalty was imposed under Section 78 penalty under Section 76 was not imposed in view of the section 80 of the Finance Act. No penalty under Section 77 was impose....
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....ticee has not declared the total value in the ST-3 returns filed for the period Oct. 2004 to March 2007. From April 2007 onwards they started showing the value of exempted services in the ST-3 returns, but failed to mention notification number in the ST-3 returns, but failed to mention notification number in the ST-3 returns against the exemption claimed. Noticee was asked to furnish the notification number under which they had claimed the exemption and the documentary evidence of the value claimed for exemption. However, inspite of repeated reminders, till date. Noticee has not made documentary evidence in support of the exemption claimed. As such, there is reason to believe that they have suppressed the facts from the department and wrongly claimed exemption, without furnishing notification number, or producing documentary evidence in support of the exemption claim, to evade ht payment of Service Tax. Therefore, the extended period of five years for demanding service tax under proviso to Sub-section (1) of the Section 73 of the said Act, read with Section 68 ibid and rule 6 of the said Rules is invokable in this case." 11.1 In this context, findings of the Commissioner, are as u....
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....ken the view that in a case in which a show cause notice has been issued for the earlier period on certain set of facts, then, on the same set of facts another SCN based on the same/similar set of facts invoking the extended period of limitation on the plea of suppression of facts by the assessee cannot be issued as the facts were already in the knowledge of the department. It was observed in para 14 as follows: "14. We have indicated above the facts which make it clear that the question whether M/s. Pharmachem Distributors was a related person has been the subject-matter of consideration of the Excise authorities at different stages, when the classification was filed, when the first show cause notice was issued in 1985 and also at the stage when the second and the third show cause notices were issued in 1988. At all these stages, the necessary material was before the authorities. They had then taken the view that M/s. Pharmachem Distributors was not a related person. If the authorities came to the conclusion subsequently that it was a related person, the same fact could not be treated as a suppression of fact on t....
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....deration as it is not known when that Show Cause Notice was dropped. If the Department wanted to take up such contentions it is for them to show that that Show Cause Notice was not relevant and was not applicable. The Department has not brought any of those facts on record. Therefore, the Department cannot now urge that findings of the Collector that that Show Cause Notice was on a similar issue and for an identical amount is not correct." 9. Allegation of suppression of facts against the appellant cannot be sustained. When the first SCN was issued all the relevant facts were in the knowledge of the authorities. Later on, while issuing the second and third show cause notices the same/similar facts could not be taken as suppression of facts on the part of the assessee as these facts were already in the knowledge of the authorities. We agree with the view taken in the aforesaid judgments and respectfully following the same, hold that there was no suppression of facts on the part of the assessee/appellant. 10. For the reasons stated above, Civil Appeal Nos. 2747 of 2001 and Civil Appeal No.6261 of ....
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....f, for the words "one year", the words "five years" had been submitted." 11.3 Extended period have been invoked by the Revenue on the grounds that the appellant/assessee did not indicate the details of non-taxable/exempted service in the ST-3 returns. Assessee's explanation in that initially format prescribed value of exempted services as also notification number. Since, they were providing non-taxable service they had not indicated details in the said column. However, from April 2007 onwards in the amended format of ST-3 returns (wherein requirement of notification number was deleted) they have indicated the amounts received and when department asked further details in February 2009 the same were provided in June 2009. We have seen the ST-3 returns, appellants contention is correct. We also note from para 4 of the demand notice dated 24.4.2010, assesse vide letter dated 15/2/2010, 16/2/2010, 22/2/2010, 23/2/2010. 24/2/2010. 25/2/2010. 26/2/2010 and 2/3/2010 produced photocopies of the invoices issued during the period October 2004 to March 2009 alongwith summary of the invoices for the period October 2004 to March 2005, 2005-06, 2006-07, 2007-08 and 2008-09. Hon'ble Supre....
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....e extended period was issued only on 21.4.2006. Again immediately thereafter appellants have again informed in detail about their activities vide letter dt. 21.6.2006. We also note that as per para 4 of the demand notice dated 23.4.2001, invoices were made available. It is also not clear which documents were asked and not supplied. Keeping in view the allegation in the demand notice dt. 21.4.2006 as also details available to the Revenue it was necessary for the department to examine all the agreements/invoices and nature of service for subsequent period to come to the conclusion whether the services provided are taxable or non-taxable and keep issuing the demand notices from October 2006 onwards. We have gone through the Hon'ble Supreme Court decision in the case of Coaltar Chemicals Manufacturing Co. reported in 2003 (158) ELT 402 (S.C.). In the said case Hon'ble Supreme Court has upheld the decision of this Tribunal rejecting the plea that since information revealed in another proceeding being available to department, extended period cannot be invoked. In that said case, Hon'ble Supreme Court has observed: "We do not think we should understand that....
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....six months to five years, it needs to be construed strictly. The initial burden is on the department to prove that the situation visualized by the proviso existed. But the burden shifts on the assessee once the department is able to produce material to show that the appellant is guilty of any of those situations visualized in the Section. 13. Interpreting this provision, this Court in Collector of Central Excise, Hyderabad v. Chemphar Drugs and Liniments, Hyderabad, (1989) 2 SCC 127, held: (when the period prescribed was six months prior to it being made one year by the Finance Act, 2000, with effect from 12.05.2000): "In order to make the demand for duty sustainable beyond a period of six months and up to a period of 5 years in view of the proviso to sub-section (1) of Section 11A of the Act, it has to be established that the duty of excise has not been levied or paid or short-levied or short-paid, or erroneously refunded by reasons of either fraud or collusion or willful mis-statement or suppression of facts or contravention of any provision of the Act or Rules made thereunde....
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....during the hearing before adjudicating authority admitted that they were providing cleaning activity service and paid the service tax along with interest voluntarily even for notices dated 15.10.2010 and 21.10.2011 even though these notices did not speak of cleaning service. We also note that even while filing appeal before this Tribunal, Revenue have not commented on various documents invoices/agreements etc. produced before the adjudicating authority. The findings of the adjudicating authority are not being disputed on such analysis, but is based upon the bald assertion that the adjudicating authority has failed to take into consideration the various documentary evidences like contract which were available before him to correctly determine the classification of service rendered by the appellant. If the Revenue would have detailed in appeal/demand notices, the same would have helped this Tribunal to appreciate if the findings of the adjudicating authority are indeed incorrect. Main plea of the respondent/assessee is that they are providing services like fire fighting services, housekeeping service, customer care service etc. and all these services are under the supervision and con....
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....atism - We have gone through the said contract which includes Guest-house, Attendant, Gardener and Sweepers. One of the terms of conditions is. "You (assessee) shall provide the manpower, machinery and equipment at the required time for the satisfactory completion of the work at no extra cost to the institute". From the said condition, it appears that assessee was providing the Gardening and Sweeping Services as the machinery and equipment were also to be supplied by the assesssee. From the available details, therefore it cannot be said that what was being provided was "Manpower Supply Service". Second contract cited is Contract No. 1171/200708 dated 31.01.2008 entered into with Punjab and Maharashtra Co-operative Bank Ltd. Bhandup (W). We have gone through the said contract. First of all the said contract appears to be with M/s. BIS Utilities Pvt. Ltd. Mumbai and not the appellant/assessee in these appeals. Further from the letter it appears that it is to provide "Customs Care service". Copy of the agreement is not available. In the absence of the said agreement, it cannot be said that this is for Supply of Manpower Service. Third contract cited is dated 1.12.....
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....service tax on the reimbursement/compensation relating to taxable services and service tax on cleaning services. The said miscellaneous applications were allowed by the Tribunal. 14. In respect of confirmation of demand relating to security services provided to ONGC, main contention of the appellant/assessee is that they have entered into an agreement with ONGC prior to introduction of service tax on security agency services and the said agreement consists of two parts. The first part is relating to the service charges on their part and second part is relating to reimbursement of the salary, provident fund, ESIC and other benefits being extended to the security personnels. After the introduction of the service tax on security services they have been trying to persuade ONGC to bear the burden of service tax. However, ONGC has refused to pay them the service tax. In fact appellant/assessee had gone to the Hon'ble Bombay High Court and the matter is pending before the Hon'ble Bombay High Court. Their contention is that as soon as matter will be sorted out and they receive the service tax amount from the ONGC, they undertake to pay the same to the department. In addition to a....
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....Tri- Del,) which is based upon the judgment of the Hon'ble Madras High Court in the case of GDA Security Private Limited Vs. Union of India reported in 2006 (2) STR 542 (Mad.). Ld. Counsel also stated that the same would apply to the reimbursement/compensation of expenses in connection with other taxable service are concerned. As far as, confirmation of the demand on the cleaning activity service is concerned, Ld. Special Counsel argued that it is not disputed by the appellant/assessee that they were providing Cleaning activity services and under the self assessment procedure it was incumbent on them to ascertain and pay the service tax. During the personal hearing they themselves agreed before the Commissioner to make the payment of the said service tax. It is thus clear that the leviability of the tax is not under dispute. The objection raised is only technical in nature and in fact the department could have issued another demand notice had they not agreed to pay the same during the personal hearing. Further, the appellants contention that they were forced to pay the said amount is not correct as they have paid the same amount voluntarily after the passing of the said adjudic....
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....will not make any difference as far as appellant/assessee's liability to pay the service tax to the Government is concerned. The fact that ONGC is not paying to them is a matter between the appellant/assessee and ONGC. We, therefore, hold that appellant is liable to pay the service tax as the services provided to ONGC and on the gross amount including salary, EPC, ESIC etc. 20. For the reasons stated above, other demand which has been confirmed by the Commissioner relating to reimbursement/compensation of expenses in respect of taxable service are nothing but similar amounts recovered from other customers and for the same reason as mentioned earlier appellant is required to pay the service tax on the same. 21. As far as the third issue relating to cleaning activity services is concerned, appellant/asessee are not disputing that they were providing Cleaning Activity service which is chargeable to service tax. In fact during the hearing before adjudicating authority they have agreed to the same and also offered voluntarily to pay the same in respect of the Cleaning Activity services provided to commercial and industrial organization. Having volunteered to pay the service tax on....