TaxTMI 
TaxTMI 
2020 (9) TMI 356
X X X X Extracts X X X X
X X X X Extracts X X X X
....oner, Central Excise and Service Tax, Bharuch D. This Hon'ble Court may be pleased to grant ex parte ad-interim relief in terms of para 9(C). E. This Hon'ble Court may be further pleased to pass such other orders that may be just and necessary in the facts and circumstances of the case in favour of the petitioners." 2. This Court passed the following order on 10th April, 2019 : "1. The learned advocate for the petitioner has tendered an affidavit in support of the petition by the petitioner. The same is taken on record. 2. In this petition, the petitioner challenges the order-in-original dated 27.9.2016 passed by the Additional Commissioner, Central Excise, Customs and Service Tax, Bharuch. It appears that since it is not possible for the petitioner to file an appeal under the relevant statutory provision before the first appellate authority, the petitioner has resorted to filing the present writ petition under Article 226 of the Constitution of India on the ground that it was not possible for him to prefer the statutory appeal within the prescribed period of limitation on account of the fact that he was suffering from various serious ailments. 3. In view of the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t was submitted that when the petitioner came back from the hospital, it was brought to his knowledge that the letters dated 15th February, 2018 and 15th March, 2018 from the respondent no.3 were received and immediately the petitioner personally contacted the Range Superintendent and obtained the copies of show cause notice dated 20th October, 2015 and the impugned order dated 27th September, 2016. 7.1) Learned advocate Mr. Patel relied upon the decision of Full Bench of this Court in case of Panoli Intermediates (India) Pvt ltd v/s. Union of India reported in 2015(2) GLR 1395, wherein this Court has held that the writ petition under Article 226 of the Constitution of India can be preferred challenging the order passed by the original adjudicating authority in following three circumstances : "(3) On the third question, the answer is in affirmative, but with the clarification that- A) The petition under Article 226 of the Constitution can be preferred for challenging the order passed by the original adjudicating authority in following circumstances that A.1) The authority has passed the order without jurisdiction and by assuming jurisdiction which there exist none, or A.2)....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the hospital from 4th July, 2016 to 12th July, 2016 and the petitioner was advised to take further treatment. It was submitted that because of the lung infection, kidneys and liver of the petitioner were severely affected and it was difficult for the petitioner to work and he had to take complete rest and due to ill health of the petitioner in the year 20162017, the petitioner could not attend his regular work and because of such facts, the petitioner could not challenge the impugned order before the appellate authority and has preferred this petition. 8. On the other hand, learned advocate Mr. Viral Shah appearing for the respondent vehemently opposed the petition and submitted that the petitioner has not stated true and correct facts. He relied upon the averments made in the affidavit in reply filed on behalf of respondent nos. 1 to 3, by Commissioner of Central Goods and Service Tax and Central Excise Vadodara-II. According to Mr. Shah the petitioner was engaged in providing taxable services under the category of "Manpower Recruitment and Supply Agency" as defined under section 65(68) of the Act, 1994 with effect from 7th July, 1997 and thereafter, the said service was renamed....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... to the SEZ unit or the developer without payment of the service tax. 8.3) It was pointed out that during the investigation, it was found that the petitioner has not submitted any documentary evidence or authorization received from SEZ unit for the services provided in SEZ and therefore, the petitioner was not entitled to exemption from payment of the service tax. It was also pointed out that the petitioner did not file any statutory returns claiming the exemption from payment of service tax during the period from 2012 to 2015. 8.4) Learned advocate Mr. Shah invited the attention of the Court to the fact that the petitioner did not respond to any of the show cause notices issued by the competent authority and thereafter order in original dated 27th September, 2016 was passed by raising demand amounting to Rs. 31,84,804/- together with penalty and interest under the provisions of the Act-1944. 8.5) With regard to service of show cause notice and subsequent opportunity given to the petitioner, learned advocate Mr. Shah relied upon the following averments made in the affidavit in reply which are not controverted by the petitioner : "15. Further, it is to submit that the Show Caus....
X X X X Extracts X X X X
X X X X Extracts X X X X
....submitted that the petition is liable to be dismissed. 8.6) Learned advocate Mr. Shah further pointed out that the adjudicating authority has levied the service tax only on 25% of the service taxable value during the period from July 2012 to March, 2015. It was therefore, submitted that the contention of the petitioner that 100% service taxable value was subject to levy from 2012 to 2015 is not true and correct. Attention was invited to the show cause notice dated 20th October, 2015 issued by respondent authority wherein calculation for service tax is made at the rate of 3.09% i.e. 25% of the service tax rate of 12.36% prevailing at the relevant time. 8.7) With regard to contention of exemption from payment of service tax provided by the petitioner to the SEZ unit, it was submitted that the exemption from payment of service tax is granted subject to certain conditions prior to 2011 and prior to 2011 notification no. 9/2009 dated 3rd March, 2009 was in force and accordingly exemption from payment of service tax to the developer of units of SEZ was provided by way of refund of service tax paid on specified services received for the authorized operation of SEZ and the developer of S....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s of the exemption." 8.9) Relying upon the aforesaid decision, it was submitted that the adjudicating authority has rightly confirmed the service tax liability on the petitioner after following all the procedures laid down under the Act-1994, whereas on the other hand the petitioner has failed to comply with the procedure and inspite of collecting the service tax amount from the customers and client did not deposit the same in the Government account. In such circumstances, it was prayed that the petition is required to be rejected. 9. Having heard the learned advocates for the respective parties and having gone through the materials on record, it emerges from the record that the petitioner was registered under section 69 pursuant to the Act-1994 for providing "Man Power Recruitment and Supply Agency Services". However the petitioner did not file the return in Form ST3 and did not deposit the service tax collected by him from his clients. It was also found by the adjudicating authority on scrutiny of the documents submitted and verified during investigation that the petitioner did not correctly declare his total service amount and purposefully concealed the income from service pro....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... therefore letters were issued to the assessee on the new operative address to provide details of business and produce documents related to its services. However despite several summons, the assessee failed to provide any document) except Annual Tax Statements under Section 203AA of the Income Tax Act,1961 in form 26AS. 17.2 A Statement of Sh. Manager Ibrahim Ansari (Proprietor: M/s Macos Enterprises] was recorded on 14.10.2015 under Section 14 of the Central Excise Act, 1944 as made applicable to service Tax matters vide Section 83 of the Finance Act, 1994 by the Superintendent of Central Excise & Service Tax, Bharuch in which he, interaiia, stated that he had provided manpower supply services to many companies situated in Dahej, vi2., M/s Hindaico Industries, M/s Videocon, M/s Samsung Engg. Co. Ltd., M/s IVCRL Ltd.,M/s Essar Projects and M/s Afcon Infra etc., during the period 2010-11 to 2014-15 and he had issued bills with Service tax against the services provided to all these firms except to ones which were situated or provided services in SEZ, Dahej. He confirmed that he had issued service bills to all his clients and received payment against the same. On being asked he furt....
X X X X Extracts X X X X
X X X X Extracts X X X X
....income appearing in Annual Tax Statements under Section 203AA of the Income tax, 1961 in Form 26AS. I further find that in his statement dtd.14.10.2015, Shri Manager Ibrahim Ansari [Proprietor M/s Macos Enterprises] has deposed that some clients M/s Samsun Engg. Co. Ltd., M/s IVRCL Ltd., M/s Fernas Construction and M/s Afcon Infa. Ltd. were working in the Special Economic Zone (SEZ), Dahej and he has provided services as subcontractor to them and therefore no service tax was payable on the services provided to them. In this respect I find that all the above firms are contractors based at somewhere else and no evidence was produced by the assessee, during investigations or afterwards to show that the assessee has provided the said services to the above contracts in a unit falling in SEZ area. Further I find that exemption to the Services provided in a unit falling in a SEZ are governed by Notification No. 12/2013 Service Tax, dtd. 01.07.2013 which provides as under : "2. The exemption shall be provided by way of refund of service tax paid on the specified service received by the SEZ Unit or the Developer and used for the authorized operations : Provided that where the specified ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he service provider was reduced by 75% (to be paid by the service recepients) from July 2012 onwards in case of Manpower supply or recruitment agency services. Since, the party wise ledger had not been provided by the assessee, therefore, the bifurcation of taxable amounts on the basis of date of receipt of service amount as appearing in the 26AS statement was tabulated for the period April2010 to 2014-15 as per details in Annexure-A of the show cause Notice. The said details show that the assessee has not paid service tax of Rs. 31,84,804/- on taxable value of Rs. 4,26,78,833/- 17.6 I find that Section 65(68) of the Finance Act,1994 defines "manpower recruitment or supply agency" service as any person engaged in providing any service, directly or indirectly, in any manner for recruitment or supply of manpower; temporarily or otherwise, to any other person. Further Section 65(105)(k) of the Act ibid. defines the taxable service in respect of manpower recruitment or supply agency service as any service provided or to be provided to any person, by a manpower recruitment or supply agency in relation to the recruitment or supply of manpower, temporarily or otherwise in any manner. Fu....
X X X X Extracts X X X X
X X X X Extracts X X X X
....th the department. They have also failed to submit the relevant documents called for during investigations. Thus they have made every possible effort to remain discreet and avoid presentation of documents to the department. It is thus evident that they have suppressed the material facts from the department with intent to evade payment of service tax of Rs. 31,84,804/- ( as per details given in Annexure-A to the SCN) and hence, I find that extended period of limitation has been correctly invoked in this case in terms of proviso to Section 73(1) of the Finance Act, 1994. 17.11 I thus had that the assessee has contravened the provisions of Section 68 read with Section 66 and 66B of the Finance Act,1994 and Rule 6 of Service Tax Rules,1994, in as much as they failed to pay the Service tax of Rs. 31,84,804/- by the due date to the Central Govt, Section 70 read with Rule 7 of the Service Tax Rules, 1994 in as much as they failed to file the half yearly returns for the taxable services provided for the period 2010-11 to 2014-15. It is evident that they have committed all the above acts of contravention by recourse to suppression of facts, willfully and purposefully, with intention to ev....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t Hundred and Four Only) on M/s Macos Enterprises [Proprietor Manager Ibrahim Ansari], presently operating from A24, Laxminagar, Nr. Welfare Hospital, Dahej by pass road Bharuch, Gujarat 392001 under Section 78(1) of the Finance Act, 1994. If the amount determined at (i) above and the interest payable thereon is paid within thirty days of the date of receipt of this order, the amount of penalty as imposed above, shall stand reduced to 25% of the service tax determined at (I) above, subject to the condition that such reduced penalty is also paid within thirty days of the date of receipt of this order, in terms of present second (ii) and third proviso to section 78(1) of the Finance Act, 1994. (iv) I impose a penalty of Rs. 10,000/- (Rs. Ten Thousand only) on them under the section 77(1)(c) of the Finance Act, 1994; (v) I do not impose any penalty on them under section 77(1)(a) of the Finance Act, 1994 (vi) I impose a late fee of Rs. 20,000/- ( Rs. Twenty Thousand only) for each return (total 11 returns and total late fee Rs. 2,20,000/- for the period April 10 to March 15) on them, under the section 70(1) of the Finance Act, 1994 read with Rule 7C of the Service Tax Rules, 1994....
X X X X Extracts X X X X
X X X X Extracts X X X X
....r it has resulted into gross injustice. We may also sum up by saying that the power is there even in aforesaid circumstances, but the exercise is discretionary which will be governed solely by the dictates of the judicial conscience enriched by judicial experience and practical wisdom of the judge." 13. In view of the above dictum of law in order to see that the present petition can be entertained or not, it has to fall in criteria prescribed in paragraph 3(A) for which rider is also provided that exercise of jurisdiction under Article 226 of the Constitution of India is discretionary which will be governed solely by the dictates of judicial conscience enriched by judicial experience and practical wisdom of the Judge. 14.In view of the facts available on record, we are of the opinion that the writ petition is not maintainable in view of stipulations made by Full Bench and even on merits, the petitioner having not complied with the provisions of the Service Tax Act at any point of time, is not entitled to claim any relief. We may refer to the decision of Supreme Court in case of Continental Foundation Joint Venture Holding, Nathpa, HP v. Commissioner of Central Excise, Chandigar....