TaxTMI 
TaxTMI 
2019 (8) TMI 263
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...., SC ORAL JUDGMENT MR. JUSTICE JYOTI SARAN Heard Mr. D. V. Pathy, learned counsel appearing for the petitioner. The Central Goods and Services Tax Department is represented by Mr. S. D. Sanjay, Additional Solicitor General, who appears with Mr. Alok Kumar Agrawal, learned counsel for the Department. The Power Distribution Company is represented through Mr. Anand Kumar Ojha, the Bank is represented through Mr. Kumar Priya Ranjan and the Accountant General is represented through Mr. Ranjan Kumar. The issue which falls for consideration herein is whether, in absence of any adjudicatory proceeding initiated by the competent authority under the Service Tax Act for assessment, quantification and consequentially fixation of liability o....
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....ing the scheme of service tax at the relevant time, it is only to be seen whether, the recovery is supported by the explanation given by Mr. Ojha, that the recovery of service tax was in the light of the agreement entered into between the petitioner and the Power Distribution Company and that the contractual amount payable to the petitioner by the Power Distribution Company was inclusive of taxes which would include the service tax amount. According to Mr. D. V. Pathy, learned counsel for the petitioner, in the nature of the contract entered into between parties, for executing a Centrally Sponsored Scheme, no service tax was payable and thus the respondent Power Distribution Company proceeding in recovering the tax on the audit objection....
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.... time casts a responsibility on a service provider for collection and payment of service tax, but the amendment to the said provision under Finance Act, 2016 which has been translated into a notification bearing no.25 of 2012 dated 20.06.2012 as well as notification no. 30 of 2012 also dated 20.06.2012 enclosed at Annexure-11 to the writ petition and Annexure-A to the counter affidavit of the respondent no. 1 respectively, which allows distribution of the service tax liability in between the service provider and service recipient but yet the law on collection remains the same and the collection of service tax is to be made by the service provider for its deposit with the Department. Now, while it is the submission of Mr. Ojha that since ....
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....tent of 50% of the service tax and the remaining 50% is to be paid by the Agency. The Service recipient and the service provider had to share the service tax to the extent of 50% each. The deduction was only of the share of Power Company to the extent of 50% of total service. 10. That it is stated that the Petitioner Agency had submitted its bill without adding any component of service tax. This was indication that the amount claimed in the invoice included the service tax portion of both South Bihar Power Distribution Company Ltd. (Service Recipient) and the Agency (Service Provider). The South Bihar Power Distribution Company Ltd. after the objection of the Audit made deduction from the running bill/Bank Guarantee only to the ext....
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....ving heard learned counsel for the parties we are in no confusion to hold that in absence of adjudication by the respondent Department on the issue, we are not required to express ourselves as to whether the contract executed by the petitioner was exigible to service tax and if the answer was 'Yes', then the extent of liability to be suffered by each of the party. We would leave such determination at the wisdom of the Department to come to a just conclusion on the issue obviously, in a duly constituted proceeding and on hearing the parties. While observing thus, we also express our anguish on the laid back attitude of the Service Tax Department in not coming forward to resolve the issue of taxibility as well as the fixation of liability,....
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....al obligation that the authorities in the Power Distribution Company has mechanically followed the audit objection of the Accountant General to take coercive action which has no lawful sanction. We note that by interim order dated 28.11.2017 the respondent Power Distribution Company was directed to restore status quo by restoring the Bank Guarantee which essential discharge is yet lacking and refuge is being taken by the company to the correspondence between the Power Distribution Company and Central Excise and Service Tax Department. We are certainly neither concerned with the correspondence going between the departments nor it can be assigned a reason for the disobedience. Prima facie, thus, the respondent authorities in the Power D....