2011 (2) TMI 1366

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....ion (1) of Section 68 of the Finance Act, 1994 for the period from 16.7.1997 to 2.6.1998.  Hence the above demand of service tax.  The show-cause notices also demanded interest on tax and proposed penalties.  These proposals were contested.  In adjudication of the dispute, the original authority confirmed the demands and, in most cases, imposed penalties.  Aggrieved by the orders-in-original, the assessees preferred appeals to the Commissioner (Appeals).  The appellate authority upheld the orders of the lower authority in the cases of M/s. Pandurang SSK Ltd., M/s. Adinath SSK Ltd. and M/s. Indo Rama Synthetics (I) Ltd.  The appeals filed by these assessees are presently before us.  In the case of other assessees, the appellate authority set aside the orders-in-original and granted relief to the assessees.  The Revenues appeals before us are directed against such orders of the Commissioner (Appeals). 2. In some of these cases, we have come across written submissions of the respondents, styled as cross objections. 3. After hearing both sides, we find that, while the counsel for the assessees claim the substantive issue to be covere....

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....ught under the net of Section 73.  On this basis, it was held that the show-cause notices issued to M/s. L.H. Sugar Factories Ltd. (recipients of GTO service) under Section 73 of the Finance Act, 1994 were not maintainable.  The civil appeals filed by the department against the Tribunal's decision in L.H. Sugar Factories case were dismissed by the apex court.  The short but self-contained judgment of the apex court is reproduced below:- We have heard Counsel for the parties. 2. Learned Counsel for the parties have drawn our notice to the relevant provisions of the Finance Act as it stood in the year 1994 and thereafter as it stood after the various amendments to the Act in subsequent years.  Having considered the relevant provisions of the Act, the Tribunal has, inter alia, recorded the following conclusion. The above would show that even the amended Section 73 takes in only the case of assessees who are liable to file return under Section 70.  Admittedly, the liability to file return is cast on the appellants only under Section 71A.  The class of persons who come under Section 71A is not brought under the net of Section 73.  The above be....

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....er certain provisions of the Finance Act, 2000 and the Finance Act, 2003 were constitutionally valid or not.  The Court's observations in passing can have no overriding effect on the view taken by a co-ordinate Bench of the same Court at a later point of time, which is the view taken in L.H. Sugar Factories case.  Even if it be assumed that contrary views were taken by co-ordinate Benches of the apex court in the cases of Gujarat Ambuja Cements and L.H. Sugar Factories, the one taken at later point of time (L.H. Sugar Factories) should prevail. 6. On a perusal of the orders passed by this Tribunal in the cases of Mangalam Cements Ltd. and Agauta Sugar & Chemicals, we note that the view taken by a regular Bench in the former case was approved by a Larger Bench in the latter.  The records indicate that the show-cause notice was issued on 4.11.2004 in Mangalam Cements case.  When the notice was issued, the amended Section 73 of the Finance Act, 1994 was in force.  We have gone through the full text of Section 73 as substituted with effect from 10.9.2004.  There is no reference to Section 70 (the provision under which service providers are required to f....

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....f Section 71A therein. 8. The learned SDR has vehemently argued about the legislative intent behind the relevant provisions of the Finance Act, 1994.  It has been submitted that the intention was to authorize the Revenue to recover service tax dues from both categories, viz., service providers and recipients of GTO/C&F services.  According to the learned SDR, the text of Section 73, as it stood prior to 10.9.2004, should be liberally construed so as to achieve the legislative purpose.  In this connection, he has relied on CIT, Thiruvananthapuram vs. Baby Marine Exports 2007 (211) ELT 12 (SC), Ponds India Ltd. vs. CTT, Lucknow 2008 (227) ELT 497 (SC) and Directorate of Enforcement vs. Deepak Mahajan 1994 (70) ELT 12 (SC) (paragraphs 24 to 27).  It has been argued that courts and tribunals must, if necessary, supplement the written word so as to give force and life to the intention of the legislature.  The learned SDR means to say that Section 71A should also be read with Section 70 in the text of Section 73 of the Finance Act, 1994 in order to give effect to the legislative intent.  If this suggestion is accepted, we think, we are doing violence to a....