TaxTMI 
TaxTMI 
TaxTMI 
2015 (1) TMI 811
X X X X Extracts X X X X
X X X X Extracts X X X X
...."FCI"). It: was found that during the year 2006-07, the petitioner had provided "Cargo Handling Service" to FCI in respect of 736123.071 MT of wheat of which FCI had admitted the bills, which totally valued at Rs. 33,94,54,351/-, which also included the amount of service tax to the tune of Rs. 3,70,18,188/-. During the year 2007-08, the petitioner had provided "Cargo Handling Services" in respect of 343253.762 MT of imported wheat to FCI in respect of which FCI had admitted the bills, which totally valued at Rs. 15,15,57,427/-, which included the amount of service tax to the tune of Rs. 1,66,71,855/-. Thus, it was found that during the period 2006-07 and 2007-08, the petitioner charged a sum of Rs. 5,44,83,233/- towards service tax and had recovered a sum of Rs. 5,36,90,043/- towards service tax from FCI during the same period. It was found that during 2009-10, the petitioner provided "Cargo Handling Service" to M/s. GPPL and charged a sum of Rs. 2,32,75,546/- towards service tax, which was not deposited to the Government Account by the petitioner-assessee. Thus, it was found that during the period from 2006 to 2010 the service tax amounting to Rs. 7,69,65,589/- recovered and colle....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the petitioner to deposit a further sum of Rs. 5 crores as pre-deposit, the petitioner-assessee has preferred the present Special Civil Application under Article 226 of the Constitution of India. 3. Shri Shalin Mehta, learned Counsel appearing on behalf of the petitioner has vehemently submitted that learned CESTAT has materially erred in directing the petitioner to deposit the sum of Rs. 5 crores as pre-deposit. It is submitted that as such by passing the impugned order, the learned CESTAT has not dealt with in detail the submissions made on behalf of the petitioner, more particularly, to the effect that on the services rendered by the petitioner to FCI, no tax is leviable in view of exemption Notification. It is submitted that the learned CESTAT has also not considered and/or dealt with the submissions made on behalf of the petitioner that the amount of service tax, which was recovered by the petitioner, was taken credit by FCI subsequently and they have adjusted the entire amount in the bills, which were raised by the petitioner subsequently as they were having running account. It is further submitted by Shri Shalin Mehta, learned Counsel appearing on behalf of the petitio....
X X X X Extracts X X X X
X X X X Extracts X X X X
....hatt, learned advocate appearing on behalf of respondent No. 2. It is submitted that as such in the facts and circumstances of the case, no error has been committed by the learned CESTAT in directing the petitioner to deposit the entire amount of service tax collected i.e. Rs. 5 crores. It is submitted that as such the petitioner had collected the amount of service tax from its clients i.e. FCI, however, did not deposit the same with the Central Government. It is submitted that therefore the petitioner is liable to make the payment of service tax to the Central Government, which the petitioner had collected from his clients. It is submitted that therefore considering the provisions of the Finance Act, 1994, more particularly, Section 73 of the said Act, show cause notice has rightly been confirmed and, therefore, the petitioner is rightly directed to deposit Rs. 5 crores as pre-deposit. 4.1 It is submitted that during the year 2006-07, the petitioner had provided "Cargo Handling Service" to FCI in respect of 736123.071 MT of wheat of which FCI had admitted the bills, which totally valued at Rs. 33,94,54,351/- inclusive of the service tax amounting to Rs. 3,70,18,188/-. It is ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....f service tax of Rs. 5,36,90,043/- is not sustainable is concerned, it is submitted that as such and in fact so far as the petitioner is concerned, the petitioner had already recovered from FCI the service tax amounting to Rs. 5,36,90,043/- and, therefore, the same is liable to be recovered from the petitioner under Section 73 of the Act. 4.2 Now so far as the submissions made by Shi Shalin Mehta, learned Counsel appearing on behalf of the petitioner that in view of the exemption Notification and after the petitioner deposits the amount of service tax in the Central Government Account, the FCI is entitled to get back the same, considering Section 73A(5) of the Act is concerned, it is submitted that the aforesaid aspect is not required to be considered at this stage. It is submitted that so far as the petitioner is concerned as the petitioner had recovered the service tax amounting to Rs. 5,36,90,043/- from FCI, considering Sections 73 and 74 of the Act, the petitioner is liable to make the said payment and credit it to the account of the Central Government. 4.3 Now so far as the submission of Shri Mehta, learned Counsel appearing on behalf of the petitioner that as the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....x and did not deposit the same with the Central Government. It appears that during the year 2006-07, the petitioner had provided "Cargo Handling Service" to FCI in respect of 736123.071 MT of wheat of which FCI had admitted the bills, which totally valued at Rs. 33,94,54,351/- inclusive of the service tax amounting to Rs. 3,70,18,188/-. It is submitted that during the year 2007-08, the petitioner had provided "Cargo Handling Services" to FCI in respect of 343253.762 MT of imported wheat to FCI in respect of which FCI had admitted the bills, which totally valued at Rs. 15,15,57,427/- inclusive of service tax to the tune of Rs. 1,66,71,855/-. It is submitted that the petitioner had recovered a total amount of Rs. 5,36,90,043/- towards service tax from FCI during the said period, however, the same was not deposited by the petitioner-assessee to the Central Government account. 5.1 Considering the above, when the petitioner was providing the services of "Cargo Handling Services" and recovered a sum of Rs. 5,36,90,043/- towards service tax from FCI, however, did not deposit the same to the Central Government Account, considering Section 73A of the Act, the petitioner was liable to ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Explosion Proof Electrical Control and Ors. (supra) and in the said decision the Division Bench has considered the decision of the Hon'ble Supreme Court in the case of Benara Valves Ltd. & Ors (supra); the decision of the Hon'ble Supreme Court in the case of Mehsana District Cooperative Milk P.U. Ltd. v. Union of India reported in 2003 (154) E.L.T. 347 (S.C.) and the decision of the Hon'ble Supreme Court in the case of Indu Nissan Oxo Chemicals Industries Ltd. Union of India reported in 2008 (221) E.L.T. 7 (S.C.) wherein it is held that while considering waiver of condition as to pre-deposit, condition can be waived on the ground of undue hardship. In the aforesaid decision, the Division Bench has also observed that twin requirement at the time of directing the pre-deposit under Section 35F of the Act as laid down in the case of Benara Valves Ltd. & Ors. (supra) are; (a) undue financial hardship of the parties and (b) safeguarding the interest of the revenue. In the present case, as observed hereinabove, as such the petitioner has not pleaded any undue financial hardship. Now so far as safeguarding the interest of the revenue is concerned, as it is required to be noted that as such....