AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2019 (4) TMI 239
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.... All the vehicles are registered as 'Public Carrier' and accordingly Road tax, registration charges, etc. stand discharged. The petitioner was providing goods transport agency service (GTA service) under Service tax laws. Liability of payment of Service tax under GTA service was on the service receiver. The receiver, Sh. Cement Ltd. (for short SCL) was discharged Service Tax on the GTA service provided by the petitioner. The Service Tax Department had been accepting this payment of Service Tax as GTA service from SCL during the periods 2009 to 2015 and onwards (to the best knowledge of the petitioner) and the same has never been questioned till date. Notwithstanding the fact that Service tax of Rs. 21.25 crores (approx) under GTA service stood discharged on the transaction between the petitioner and SCL for the period covered by SCN; unnecessary harassment was caused to the petitioner by conducting search proceedings, investigations on the same transaction; ultimately culminating in issuance of show cause notice on the petitioner. 3.1 The show cause notices were issued demanding Service tax from the petitioner under the category of "supply of tangible goods service" on the sa....
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....in it was held as follows :- 26. We should now briefly deal with the fourth issue raised by the Bench. The 3rd proviso to Section 32E(1) states that an application for interpretation of the classification of the excisable goods under the Central Excise Tariff Act, 1985 cannot be made. The main provision of Section 32E(1) however, requires that the application is to give particulars of the excisable goods in respect of which he admits short levy on account of mis-declaration or otherwise. Section 32F(1) shows that cases involving complexity are expected to be settled by the Settlement Commission. A complicated case may have several issues including one of classification, bearing on the determination of the duty amount to be paid. It is, therefore, appears that the 3rd provision to Section 32E(1) refers to exclude an attempt by an applicant to have a pure classification issue settled by the Commission. This is so because classification of goods has to be uniform for all manufacturers of identical goods and there cannot be any settlement with regard to classification of goods per se. In this case, however, as correctly pointed out by the learned Advocate and accepted by the Depa....
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..... In case, however, some other SCN has been issued to the applicant relating to this duty acceptance on account of services falling u/s 66E, the applicant is free to approach the Settlement Commission in a separate application. 20. We further find that in the two SCNs the Department has alleged that the services being provided by the applicant are classifiable under "the supply of tangible goods" and has collectively demanded a sum of Rs. 85.61 crores as service tax from the applicant. The applicants, on the other hand in his Settlement Application and during the hearing on 22-3-2017 has contended that the services provided by him fall in the category of "Goods Transport Agency" on which the Service Tax has already been discharged by the service recipients under reverse charge mechanism. Further as per Annexure 2 to the Settlement Application, the applicants has not accepted any additional duty liability. Subject of the SCNs is thus a dispute regarding the classification of services being provided by the applicant. In this context, we note that the fourth proviso to sub-section (1) of Section 32E made applicable to service tax as per Section 83 of the Finance Act, 1994 expres....
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.... on 3-1-2017, the additional admitted Service Tax liability of Rs. 3,00,000/- is also not even remotely connected with the dispute. Once the disclosure of Service Tax liability is not true as is apparent in this case then Settlement application already admitted can be rejected at any stage till the issue of the Final Order. 25. Similar views have also been held by Hon'ble Delhi High Court in case of DGCEL v. Murari Lal Harish Chander Jaiswal Pvt. Ltd. [2013 (291) E.L.T. 484]. 26. Even otherwise the applicants were informed under the Commission's letter dated 17-1-2017 that their applications have been admitted subject to the condition that the applicants show at the time of final hearing that they fulfil the conditions of Section 32E of Central Excise Act, 1944. 7. He further contended that Settlement Commission has failed to appreciate the judgments of the full bench of the Commission which were strongly relied upon by the present petitioner. The relevant part of the judgment reads as under :- 7.1 In RE : Triruchengode Lorry Urimaiyalargal Sangam, 2016 (41) S.T.R. 343 (Sett. Comm.) wherein it has been held as under :- 2.9 The applicant entered into ag....
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....tutory provision applicable to settlement of Customs and Central Excise cases, whether the applicant can disclose more than the amount mentioned in the show cause notice. (ii) Whether the amount indicated by the applicant as admitted liability can be varied by the Settlement Commission, keeping in view the correct legal proposition relating to the facts referred to in the application and in accordance with the legal provisions in the Customs and Central Excise laws. 7. In view of the legal position enumerated supra, the issues referred to Special Bench for decision can be answered as below :- (i) Under the statutory provisions applicable to settlement of Customs and Central Excise cases, whether the applicant can disclose more than the amount mentioned in the Show Cause Notice? Ans. The applicant has inherent right to disclose any amount above Rs. 2 lakhs as the disclosure is related to the assessment documents and not in relation to the Show Cause Notice. The Show Cause Notice may not have covered all the issues or the entire amount inasmuch as it is the Applicant who knows what is t....
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....s freight to the extent of 20% of the FOB value and insurance to the extent of 1.25% of the FOB value as per the Customs Valuation Rules, 1988 and thus determines the CIF values and thereafter by adding to it landing charges to the extent of 1% of the CIF value, determines the assessable value for the purposes of the assessment of duty. Later, this case is brought to the Commission by the importer for settlement. After admission of the application, the Commission finds from the report of the Commissioner that the assessable value would be more than what has been determined by the assessing officer inasmuch as during the investigation, the department has found that the importer has actually paid more freight and insurance which have not been disclosed before the proper officer earlier. Consequently, the admitted liability falls short of the actual liability. In this situation, the Commission cannot ignore the report of the Jurisdictional Commissioner or the Commissioner (Investigation) inasmuch as the report is the statutory requirement in terms of sub-section (6) and sub-....
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....ner of Central Excise, Jaipur-I is devoid of merits and in any case, the fourth proviso to Section 32E(1) of the Act can have no application in Service Tax matters. The reason for disputes relating to classification of excise tariff not being before this Hon'ble Commission has been succinctly stated in the decision of this Hon'ble Commissioner in the case of In re : Oriflame India Pvt. Ltd. - 2000 (122) E.L.T. 601 (Sett. Comm.) wherein it was held as follows :- 26. We should now briefly deal with the fourth issue raised by the Bench. The 3rd proviso to Section 32E(1) states that an application for interpretation of the classification of the excisable goods under the Central Excise Tariff Act, 1985 cannot be made. The main provision of section 32E(1), however, requires that the applicant is to give particulars of the excisable goods in respect of which he admits short levy on account of mis-declaration or otherwise. Section 32F(1) shows that cases involving complexity are expected to be settled by the Settlement Commission. A complicated case may have several issues including one of the classification, bearing on the determination of the duty amount to be paid. It, therefore, ....
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....f Service Tax issues are also required to be meted with the same treatment. In any case, post 2012 with the advent of Negative list under Service Tax laws there is no segregation of taxable services. Consequently, Service tax matters cannot be barred on the ground of any classification dispute. For this reason, the objection raised in the Report is devoid of merits. In any case, the real issue in the present matter is actually not one of classification. Shree Cement Ltd. has been discharging Service Tax under 'goods transport agency service' on the transaction entered into by the Applicant after claiming the benefit of exemption Notification No. 25/2012-S.T. To the best of knowledge of the Applicant, the Department has all along being accepting this Service tax liability. The Department to augment excess revenue decided to issue the show cause notices demanding Service Tax from the Applicant on the same transaction under 'supply of tangible goods service' basically on the premises that there was no Service tax exemption if this service were to apply. Consequently, the essence of the show cause notices is not really on the issue of classification. The Department is seeking to given....
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....partment is seeking to precisely demand Service tax twice on the same transaction entered into between the Applicant and Shree Cement Limited. The Department is required to be put to strict notice on the basis as to why Service Tax is sought to be demanded twice on the same transaction. It is settled law that State has no right to retain a tax collected without authority of law and the same is required to be refunded [refer Commissioner of Sales Tax v. Auriaya Chamber of Commerce, Allahabad - 1986 (25) E.L.T. 867 (S.C.)]. Given this, the Department is required to be put to strict notice on their position in the matter. If the view of the Department is in consonance with that of the show cause notice then the Department is required to inform whether they were collecting Service Tax from Shree Cement Limited under 'goods transport agency' during the period from 2009-2015 on the transaction entered into with the Applicant. If yes then why was the amount not refunded back and why was Shree Cement Limited not informed to deregister itself under 'goods transport agency service'. The entire issue raised by the Department appears to be riddled in contradiction. It is also not in dispute t....
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....assessee and given reasons independently without influenced by the fact that this court has set aside the order on merits to maintain jurisdictional discipline since two decisions are not considered. 8. In view of the above, we remit back the matter to the Tribunal, we have not expressed any opinion on the merits of the case and the Tribunal will give its own finding after considering both the judgments. 9.1 He also relied upon the decision of Gujarat High Court in M/s. Padmavati Tubes v. The Commissioner of Central Excise and Service Tax - 2017 (3) TMI 411 = 2017 (351) E.L.T. 38 (Guj.) wherein it has been held as under :- 8.0 In view of the above and for the reasons stated above and on the aforesaid ground, the impugned judgment and order passed by the Learned Customs, Excise and Service Tax Appellate Tribunal, Ahmedabad in appeal No. E/399/2008, dated 31-10-2014 is hereby quashed and set aside and the matter is remanded to the learned Tribunal to decide the appeal afresh in accordance with law and on merits and after considering the submissions which may be raised by the respective parties and after considering and dealing with the citations that may be relied u....
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.... be well-nigh impossible to record a finding whether a decision is rational or irrational without first evaluating the facts of the case and coming to a plausible conclusion and then testing the decision of the authority on the touchstone of the tests laid down by the Court with special reference to a given case. This position is well settled in Indian administrative law. Therefore, to a limited extent of scrutinizing the decision making process, it is always open to the Court to review the evaluation of facts by the decision maker. 11.2 In Commissioner of Customs (Import) v. Noshire Moddy - 2014 (300) E.L.T. 205 (Bom.), it has been held as under :- 6. Counsel appearing on behalf of the Revenue submits that the car which was imported was not a new car within the meaning of the exemption notification. Whether a vehicle is or is not new is a pure finding of fact. The facts which have been found by the Settlement Commission indicate that the car was in fact a new car which was transshipped from the manufacturer in Italy to the Ferrari dealer in the U.K. who sold the car to a dealer in the U.K. The Respondent purchased the car from the dealer in the U.K. The Settlement Comm....
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..../ SC/0410/1993 : (1993) 204 ITR 616 (4) Kuldeep Industrial Corporation etc. v. Income-Tax Officer and others, MANU/SC/0899/1997 : (1997) 223 ITR 840 A careful study of both the majority and the minority opinions expressed by the Settlement Commission shows that on the basic principles that are applicable to the proceedings before the Settlement Commission, there is no major disagreement. All the three members, including the Chairman, are agreed that it cannot be said that there was no full and true disclosure of the duty liability merely because the applicant did not admit the duty liability mentioned in the show cause notice which, in the present case, is '245.56 crores. They are also agreed that if the case involves a detailed adjudication into complex facts and issues of duty liability, the proper forum would be the adjudicating officer and not the Settlement Commission. It is only in the application of these principles to the facts of the case that there is disagreement between the members, the Chairman and one member constituting the majority holding that the applicant has made a full and true disclosure of the duty liability and the case also does no....