TaxTMI 
TaxTMI 
2015 (11) TMI 102
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....ry Services and Management Consultant Services. The appellant had been regularly paying the taxes and filing the returns. During the course of audit during July, 2010, it was found that the appellant have short paid service tax, being liability on the reverse charge basis in respect of Business Auxiliary Services and Management Consultant Services received from abroad. In the statement recorded of the Authority signatory, Shri DB Padgaonkar, it is explained that the amount shown in the Ledger, duly signed by him, pertains to solar industries India (Pvt.) Ltd. He also stated that they were paying the service tax regulary, however some amount of service tax appears to be short paid, due to lack of communication between the accounts Department and the person looking after the Central Excise matter. The assessee paid the said amount (short paid) of service tax Rs. 10,86,739/- along with interest of Rs. 92,256/- vide challan dated 17.08.2010. The show-cause notice dated 23.9.11 was issued on the appellant for the period January 2008 to June 2010 wherein it was alleged that in the course of audit by CERA, it was found that the appellant have received services from foreign commission age....
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.... payment of service tax. As the payment for the services received from abroad is paid in foreign currency, the officer dealing with the Excise matters prepares returns and deposit the tax on the advise of the officer dealing with the banking matters. It was further explained that in the facts and circumstances there is no deliberate default and/or suppression on the part of the appellant nor any Act leading to deliberate default in the payment of tax liability. 4. The show-cause notice was adjudicated by Order-in-Original dated 19.07.2013 by which the proposed demand was adjudicated and appropriated along with interest. Further penalty of Rs. 2000 was imposed under Section 70 read with Rule 7C of the Service Tax Rules for delayed filing, of each returns, further penalty was imposed being 2% of such tax per month or Rs. 200/- per day whichever is higher for non-payment of service tax on the due dates and further penalty of Rs. 2000/- was imposed under Section 77 and penalty equal to the amount of tax was imposed under Section 78. Being aggrieved, the appellant preferred appeal before the Commissioner (Appeals) who was pleased to reject the appeal, holding that the appellant mainl....
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.... on the input services. The amount of service tax paid during the last two accounting year for 2008-09 and 2009-10 is about Rs. 26 lakhs per annum, which is fully adjustable with the Central Excise liability. In view of the Revenue neutrality there is no incentive to evade the tax leviable towards service tax, on the reverse charge basis. The learned Counsel further relies on the ruling of the Apex Court in the case of CCE V/s. Pals Microsystems Ltd wherein it has been held that there has was some finding to the effect that there was a fraud or of wilful misstatement or suppression of fact. Extended period of limitation is invocable only when there is positive act other than merely inaction of failure on the part of the manufacturer and that there is no conscious of deliberate withholding of information by the manufacturer. The learned Counsel further relies on the division bench ruling of this Tribunal in the case of Accurate Chemical Industries Vs. CCE- 2014 (300) ELT 451 wherein in the goods cleared as stock transfer to parent unit at a price lower than hundred 110% /115% of cost of production, the question was whether duty payment should conform to requirement of Rule 8 of Cent....
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.... to evade the payment of duty, the Tribunal was justified in coming to the conclusion that the extended period of limitation under the proviso to section 11 A (1) of the Act, would not get attracted. The appellant submits that the above ratio is squarely applicable to the present case and the situation in the present case is also revenue neutral. Thus the appellant prays for allowing the appeal and setting aside the penalties imposed under section 76, 77 and 78 of the Finance Act, 1994. 6. The learned A.R appearing for the Revenue supports the impugned order. He further points out that it had been rightly held in the impugned order that the appellant have deliberately defaulted in payment of the current service tax liability. For that the discrepancy came to light only when the Revenue Audit directed the appellant to prepare the reconciliation with respect to the payments made in foreign currency as appearing in the financial statements along with the tax liability. The learned A.R. further relies on the ruling of the Punjab and Haryana High Court in the case of CCE Vs. Supreme Polytubes (P) Ltd. 2010 (262) ELT 231 wherein the Excise Preventive Staff visited the factory premises....
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....lue. It was held that the demand of duty for the extended period was not time barred. The issue of Revenue neutrality pleaded by the assessee appellant was also not accepted and it was held that the demand of duty for the extended period cannot be resisted by the appellants on the premise that whatever duty paid by them would ultimately be available as Modvat/ Cenvat credit to the buyer. The Tribunal placed reliance on the decision in the case of M/s. Jay Yushin Ltd. Vs. Commissioner-2000(119) ELT 718 in this connection. 7. Having considered the rival contentions, I hold that there is no case of contumacious conduct and/or suppression of facts, or any case of mis-statement with intention to evade the payment of duty/tax is made out against the appellant. The explanation given by the appellant, at the very first instance, at the time of recording of the statement, that the discrepancy occurred due to lack of co-ordination between the two Departments as separate officers were dealing with the banking matter and other dealing with the Central Excise and Service Tax compliances have not been found to be untrue, by both the Courts below. Further I find from the conduct of the appella....