TaxTMI 
TaxTMI 
TaxTMI 
2017 (11) TMI 1466
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.... of Service Tax of Rs. 32,37,331/- and education-cess of Rs. 64,747/- for the period 1/10/2004 to 15/06/2004, in terms of the provisions of proviso to Section 73(1) of chapter (V) of the Finance Act 1994. The said Show Cause Notice culminated into an order passed by the Original Adjudicatng Authority, confirming the demands along with interest and imposing penalties under various sections of the Finance Act. 3. On appeal, Commissioner (Appeals) observed that the appellant, as multi system operator, was receiving signals, in respect of programmes broadcasted by television channels and was transmitting the same to various cable operators, who were further re-transmitting the same to the viewers. The services provided by the cable operators were taxable w.e.f. 16.08.02. All such cable operators, to whom the appellant was serving as multi system operator, were registered with the department and have paid the Service Tax on the ultimate value added service. As such, he has concluded that the service tax, now being confirmed against the appellant, was available as Cenvat Credit to cable operators, who would have utilized the same for payment of Service Tax on the cable operators service....
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....sent appeal by the Revenue. 6. After appreciating the submissions made by both the sides and after going through the impugned orders, we find merits in the reasoning adopted by Commissioner (Appeals) for holding the demand to be barred by limitation. Apart from the fact that the Service Tax was in a confused state of the mind for the general public, we note that there could be no motive on the part of the assessee not to pay service tax inasmuch as the service tax payable by him, was available as a credit to the cable operators, who were already in the service tax net and were paying service tax. The said cable operator were under same Commissionerate and the tax collected by the Revenue would have been the same. It is the well settled law that in case of Revenue neutral situation, no malafide can be attributed to the assessee so as to invoke the longer period of limitation. The reference made to various decisions of the Hon'ble Supreme Court, by Commissioner (Appeals), as detailed in the preceding paragraphs, reflect upon the said legal issue. In fact the list of such decisions is never ending and it is almost the settled law that in case of Revenue's neutrality, there can be no ....
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....enue thereafter took more than 2 years to issue the Show Cause Notice in question for the period prior to 16.06.2007. 9. For all the reasons recorded above, we find no merits in the Revenue's appeal, the same is accordingly rejected. (Pronounced in open court) Appeal No.ST/255/2009-CU (DB) CCE, Jaipur-II Vs. Sky Media Pvt. Ltd. Per Rakesh Kumar: 10. I have gone through the order dictated by my learned sister in the open court on 8.12.2014. Since I do not agree with her conclusion, I am recording a separate order. 11. The respondent are a multi-system operator (MSO). An MSO receives the signals from the broadcasters and transmits the same to the various cable operators, who in turn, transmit the signal through their networks to their ultimate customers. The service provided by MSOs became taxable under Section 65(105)(zs) of the Finance Act, 1994 w.e.f. 10.09.2004. The respondent, however, neither obtained service tax registration nor paid the service tax on the amount received by them from the cable operators for transmitting the signals to them. A show cause notice dated 21.08.2007 was issued to the respondent for demand of service tax of Rs. 32,37,331/- along with educa....
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....ssionerate and the tax collected by the Revenue would have been the same; and (c) It is well settled law that in case of a revenue neutral situation, no malafide can be attributed to an assessee so as to invoke the longer limitation period. 14. I do not agree with this view of the Hon'ble Member (Judicial). Firstly, the service provided by the respondent - Multi System Operator's service had become taxable w.e.f. 10.09.2004 and in my view, ignorance of law cannot be an excuse for non-payment of tax, more so, in case of multi-system operators, who are not small persons. It is also seen that the respondent had started paying service tax as multi system operators w.e.f. 16.06.2005 and there is no explanation as to why, at that time, they did not pay the tax for the period from 10.09.2004. The principle of non-applicability of longer limitation period under proviso to Section 73(1) of the Finance Act, 1994 or Section 11A(1) of the Central Excise Act, 1944 in the case of Revenue neutral situation is applicable only in that case where any tax payable by an assessee is immediately available to him as cenvat credit (larger bench judgment in case of Jay Yushin Ltd. Vs. CCE, New Delhi rep....
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....sides, penalties were also imposed under Section 76 & 78 ibid. On appeal against the said adjudication order, the ld. Commissioner (Appeals) vide order dated 22.01.2009 has allowed the appeal in favour of the respondent on the ground of revenue neutrality and on the ground that entire demand was hit by limitation, as the SCN had alleged only 'suppression' and not 'suppression with intent to evade tax'. Feeling aggrieved with the impugned order dated 22.01.2009, Revenue has filed the appeal before the Tribunal and the respondent has also filed Cross- Objection. 18. In the Interim Order dated 18.09.2014, the ld. Member (J) has opined that demand is hit by limitation and also the demand is not sustainable on the ground of revenue neutrality. However, ld. Member (T) has expressed the opinion that the demand is not hit by limitation and also the benefit of revenue neutrality is not available to the respondent. Accordingly, vide Interim Order dated 18.09.2014, the Division Bench has recorded the following difference of opinion, for resolution by the Third Member:- "Whether in this case, longer limitation period under proviso to Section 73 (1) of the Finance Act, 1994 is applicable for....
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....ent of service tax was deliberate, with the intent to defraud Government Revenue. 22. On perusal of the case records, I find that the ld. Commissioner (Appeals) vide the impugned order dated 20.01.2009 has allowed the appeal of the present Respondent on the ground of limitation alone, holding that in absence of proof by Revenue regarding wilful suppression of facts or intent to evade payment of service tax by the Respondent, confirmation of adjudged demand under extended period of limitation is not sustainable. 23. The show cause notice dated 21.08.2007 was issued for confirming the proposed service tax demand for the period from 01.10.2004 to 15.06.2005, alleging that the appellant had suppressed the facts from the Department regarding the taxable service provided by it. The Department never alleged that the respondent had suppressed the facts with intent to evade payment of tax. In context with issuance of show cause notice, where there is no involvement of suppression on the part of the assessee, the Hon'ble Supreme Court in the case of Cosmic Dye Chemicals Vs. CCE, - 1995 (75) ELT 721 (S.C.) have held that intent to evade duty must be proved for invoking the extended period o....