2014 (7) TMI 625

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....the manufacture of branded un-manufactured tobacco & export activities. It was noticed during the course of audit that the appellants had paid huge sums of money towards 'Sales Commission' to their foreign agency, which fell under the category of 'Business Auxiliary Service' attracting service tax at the hands of the appellant under reverse charge mechanism with effect from 16.06.2005. Appellants paid basic service tax amounting to Rs. 66,15,748/- in February/ March 2007 against their basic service tax liability of Rs. 52,90,172/- for the financial year 2005-06, thereby paying excess service tax amounting to Rs. 13,25,576/-, the reasons for excess payment advanced by the appellants being wrong computation of service tax based on mercantile ....

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....ing authority also confirmed the demand of Education Cess amounting to Rs. 1,09,527/- and appropriated the same against Education Cess already paid in April 2008, which is not the subject matter of dispute in the present appeal. On appeal by the appellants, the Commissioner (Appeals) upheld the order of the adjudicating authority vide the impugned Order-in-Appeal dated 25.02.2013. 3. Shri S. R. Dixit, (Advocate) appearing for the appellant argued that the appellants have already paid excess service tax of Rs. 13,25,576/- for the financial year 2005-06 in February/March 2007, against which the service tax liability of Rs. 1,86,166/- for the period 2006-07 could be adjusted; that the appellants were not required to pay any service tax unde....

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....s the department was aware of the activities of the appellant, therefore, the entire demand is time barred. 4. Shri Manoj Kutty (AR) appearing for the Revenue argued that there was no provision in service tax law for adjustment of excess paid service tax for the year 2005-06 against service tax liability for the year 2006-07. He cited the case law - BBC World (I) Pvt. Limited vs. Commissioner of Service Tax, New Delhi - [2009 (14) STR 152 (Tri. Del.)] in support of his arguments. 5. Heard both sides and perused the case records. It is observed that in this case the disputed amount of short-paid basic service tax for the period 2006-07 is Rs. 1,86,166/-, while the appellant had paid excess amount of service tax to the extent of Rs. 13,....

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....l consideration of the matter, we do not find any infirmity in the view taken by the Commissioner (Appeals). We do not find any merit in the appeal filed by the Revenue, the same is rejected. 5.2 Further, in the matter of Commissioner of Central Excise vs. Powercell Battery India Limited (supra), this Tribunal has held as under: 6. I have considered the submissions made at length by both sides and perused the records. The issue to be decided in this case is whether the adjustment made by the appellant on the excess payments made by them under the provisions of Rule 6 of the Service Tax Rules for payments of service tax, a liability that arose subsequently. The relevant rule which provides for such adjustment is Rule 6 (3) which is ....