TaxTMI 
TaxTMI 
2011 (8) TMI 1036
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....11,88,99,426 1,98,33,831 12.36% 24,51,462 TOTAL 49,93,998 2. Intra-port transportation of ores in terms of agreements with M/s. T.M. International Logistic Ltd., subsidiary of M/s. TISCO : Period during which services were rendered Inland transportation charges realized by the assessee (Rs.) Inland transportation charges incurred by the assessee (Rs.) Service charges (Rs.) [(2)-(3)] Gross rate of Service Tax Gross Service Tax payable (Rs.) (1) (2) (3) (4) (5) (6) F.Y. 04-05 58,86,449 51,89,243 6,97,207 10.2% 71,394 F.Y. 05-06 1,72,88,595 1,50,60,361 22,28,234 10.2% 2,27,280 F.Y. 06-07 1,99,40,961 1,75,36,530 24,04,431 12.24% 2,94,302 F.Y. 07-08 1,90,11,843 1,65,29,968 24,81,875 12.36% 3,06,760 F.Y. 08-09 1,86,75,356 1,66,06,478 20,68,878 12.36% 2,55,713 TOTAL 11,55,449 3. Processing of pyroxenite for M/s. TISCO : Period during which services were rendered Processing charges realized by the assessee (Rs.) Gross rate of Service Tax Gross Service Tax payable (Rs.) 16-6-200....
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....r (vi) provision of service on behalf of the client; or (vii) a service incidental or auxiliary to any activity specified in sub-clauses (i) to (vi), such as billing, issue or collection or recovery of cheques, payments, maintenance of accounts and remittance, inventory management evaluation or development of prospective customer or vendor, public relation services, management or supervision, and includes services as a commission agent, but does not include any activity that amounts to "manufacture" within the meaning of clause (f) of section 2 of the Central Excise Act, 1944 (1 of 1944). Explanation. - For the removal of doubts, it is hereby declared that for the purposes of this clause, - (a) "commission agent" means any person who acts on behalf of another person and causes sale or purchase of goods, or provision or receipt of services, for a consideration, and includes any person who, while acting on behalf of another person - (i) deals with goods or services or documents of title to such goods or services; or (ii) co....
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....ason, a taxable service is prima facie, classifiable under two or more sub-clauses of clause (105) of section 65, classification shall be effected as follows : (a) the sub-clause which provides the most specific description shall be preferred to sub-clauses providing a more general description; (b) composite services consisting of a combination of different services which cannot be classified in the manner specified in clause (a), shall be classified as if they consisted of a service which gives them their essential character, in so far as this criterion is applicable; (c) when a scrvice cannot be classified in the manner specified in clause (a) or clause (b), it shall be classified under the sub-clause which occurs first among the sub-clauses which equally merits consideration; 66. There shall be levied a tax (hereinafter referred to as the service tax) at the rate of twelve per cent. of the value of taxable services referred to in sub-clauses .................... 68. Every person providing taxable service to any person shall pay service tax at the rate specified in section 66 in such manner and....
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....n 73(1) of the Finance Act, 1994 provides as follows : "73. (1) Where any service tax has not been levied or paid or has been short-levied or short-paid or erroneously refunded, the Central Excise Officer may, within one year from the relevant date, serve notice on the person chargeable with the service tax which has not been levied or paid or which has been short levied or short paid or the person to whom such tax refund has erroneously been made, requiring him to show cause why he should not pay the amount specified in the notice : Provided that where any service tax has not been levied or paid or has been short-levied or short-paid or erroneously refunded by reason of - (a) fraud; or (b) collusion; or (c) wilful misstatement; or (d) suppression of facts; or (e) contravention of any of the provisions of this Chapter or of the rules made thereunder with intent to evade payment of service tax, by the person chargeable with the service tax or his agent, the provisions of this sub-section shall have effect, as if, for the words "one year", the words "fi....
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....m the relevant date. The demand in the impugned show cause notice of Rs. 71,394/- on account of intra-port transportation of ores in the Financial Year 2004-2005 is ex facie barred by limitation as five years had elapsed from the relevant date. 12. The petitioner has, by its letter dated 7th June, 2010, a copy of which has been annexed to the writ petition, given a detailed reply to the show cause notice, inter alia contending that the impugned show cause notice was barred by limitation, in view of Section 73(1) of the Finance Act, 1994. 13. Mr. J.K. Mittal appearing on behalf of the petitioner submitted that all the claims were barred by limitation as the conditions precedent for invocation of the extended period of limitation as provided in the proviso to Section 73(1) of the Finance Act, 1994 were wholly absent. 14. Mr. Bharadwaj, appearing on behalf of the Department has taken a preliminary objection to the writ petition, inter alia contending that the petitioner had an equally efficacious alternative remedy of adjudication before the Adjudicating Authority. Mr. Bharadwaj argued that since the issue raised in the writ petition, that is, the question of whether....
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....s a question of jurisdiction in the sense that an authority has no jurisdiction to issue a show cause notice which is barred by limitation. In the State of Punjab v. Bhatinda District Cooperative Milk P Union Ltd. reported in 2007 (217) E.L.T. 325 (S.C.) = (2007) 11 SCC 363, the Supreme Court held that the question of limitation being a jurisdictional question, a writ petition challenging the validity of a notice of revision of an order of assessment of sales tax, on the ground of the same being barred by limitation, would be maintainable, notwithstanding an alternative statutory remedy. 22. It is well-established that where the jurisdiction of an authority depends upon a preliminary finding of fact, this Court in exercise of its writ jurisdiction is entitled to examine whether the findings on jurisdictional facts arc correct or not. This proposition finds support from the judgment of the Supreme Court in the State of Madhya Pradesh & Ors. v. D.K. Yadav reported in AIR 1968 SC 1186. 23. In M/s. Raza Textiles Ltd., Rampur v. The Income Tax Officer, Rampur reported in AIR 1973 SC 1362, the Supreme Court held that no authority, much less a quasi-judicial authority, could c....
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....f and the existence of reasons for that belief. The belief must be held in good faith: it cannot be merely a pretence. If it be asserted that the Income Tax Officer had reason to believe that income had been under-assessed by reason of failure to disclose fully and truly the facts material for assessment, the existence of the belief and the reasons for the belief, but not the sufficiency of the reasons, will be justiciable. The expression therefore predicates that the Income Tax Officer holds the belief induced by the existence of reasons for holding such belief. It contemplates existence of reasons on which the belief is founded, and not merely a belief in the existence reasons inducing the belief; in other words, the Income Tax Officer must on information at his disposal believe that income has been under-assessed by reason of failure fully and truly to disclose all material facts necessary for assessment. Such a belief, be if said, may not be based on mere suspicion: it must be founded upon information." 27. The Court exercising jurisdiction under Article 226 of the Constitution of India may be required to examine jurisdictional facts to ascertain whether jurisdiction to i....
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....stant Commissioner that conversion of coal into coke amounted to manufacture and was thus exempted from service tax in view of the proviso to Section 65(19) of the Finance Act, 1994. 36. Thereafter the petitioner received another letter dated 30th October. 2008 from the Commissioner of Central Excise and Service Tax, Ranchi alleging that conversion of coal into coke constituted 'business auxiliary service'. The petitioner by its letter dated 12th November, 2008 replied to the aforesaid letter of the Commissioner of Central Excise and Service Tax, refuting the contention that conversion of coal into coke constituted business auxiliary service. 37. By a letter dated 9th March, 2007 the Superintendent of Central Excise, Paradeep Bench demanded service tax on intra-port transport charges under 'port service' contending that intra-port transportation was covered under the category of port service. 38. By a letter dated 5th April, 2007, the petitioner refuted the demand contending that the petitioner was neither a port nor had been authorized by any port and the service rendered by the petitioner did not constitute port service. The petitioner also filed a writ petition....
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....oviso to Section 73(1) of the Finance Act, 1994 has been invoked. 47. The period of limitation for issuing a show cause notice is one year from the relevant date. The expression "relevant date" has not been defined in the Finance Act, 1994 as amended till date. On a reading of the various provisions of the Finance Act, 1994 as amended from time to time and the Rules framed thereunder the expression 'relevant date' would have to be construed as the date on which the tax was payable. 48. Under Rule 6 of the Service Tax Rules, 1994 as they stood at the material time, service tax was to be paid to the credit of the Central Government by the 5th day of the month following the calendar month in which payment towards the value of the taxable service was received. In ease of electronic transfer through internet banking, payment could be made within the 6th day of that month, that is one day later. Limitation, would thus start running from the seventh day of the month following the calendar month in which payment for the taxable service had been received by the petitioner. 49. The onus is on the authority issuing the show cause to disclose relevant facts in the show cause ....
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....ow cause notice of any fraud, collusion or misrepresentation. There is a vague assertion of suppression of facts and contravention of Chapter V with intent to evade payment of Service Tax. 57. In Anand Nishikawa Co. Ltd. v. Commissioner of Central Excise, Meerut reported in (2005) 1 SCC 745 = 2005 (188) E.L.T. 149 (S.C.), the Supreme Court held that mere failure to declare does not amount to wilful suppression. There must be some positive act on the part of the assessee. The judgment in Anand Nishikawa (supra) has been followed by the Supreme Court in Commissioner of Excise, Aurangabad v. Bajaj Auto Ltd. reported in 2010 (260) E.L.T. 17 (S.C.) cited by Mr. J.K. Mittal appearing for the petitioner. 58. The extended period of limitation can be invoked when there is a conscious act to evade tax, for example deliberate non-disclosure of some bills pertaining to any particular taxable service rendered by the assessee. Similarly, if an assessee withholds information in spite of requisition to provide the same, with intention to evade tax, the assessee would be guilty of wilful suppression. 59. It is not the case of the respondents as made out in the show cause notice th....
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....'port service' under Section 65(105)(zn), as amended, could not have constituted a business auxiliary service. Had services of such nature constituted business auxiliary service, there would not have been any need to amend the definition of port services. Moreover, the petitioner would not have been registered as service provider in relation to 'port services'. 66. The facts disclosed in the pleadings and/or documents annexed thereto, which are matters of record, clearly reveal that there was confusion, as to whether Service Tax was payable at the material time for the service of conditions precedent for exercise of jurisdiction to issue a show cause notice by invoking the proviso to Section 73(1) of the Finance Act, 1994 were absent. 67. As held in Bajaj Auto (supra) once the Service Tax Authorities discharge there initial onus of producing materials to show that the assessee is guilty of any of the acts specified in the proviso to Section 73(1), the burden would shift on the assessee. In this case, the respondents have failed to discharge their initial onus. 68. Section 73(1) of the Finance Act , 1993 being substantially in pari materia with Section 11A(1) of th....