TaxTMI 
TaxTMI 
2008 (12) TMI 43
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.... be differently worded but purportedly to cover this controversy. However, appeal No.54/2007 was admitted on 23.10.2007, without framing any substantial question of law. However, in view of the above, the said question is hereby framed in this Appeal No. 54/2007 also. 3. The facts in all the five appeals are different, as they are different assessees, carrying on different types of business, did not get registration as required by the relevant chapter, introduced by the Finance Act, 1994, relating to imposition of Service Tax, hereafter referred to as the "Service Tax Act", and notices were issued. Thereupon adjudication of liability of amount of tax and penalty was made. The matter was carried in appeal, and then the matter was finally carried to the Tribunal. 4. The learned Tribunal passed different orders, holding, that the Government of India Ministry of Finance, vide D.O. Letter dated 20.9.2004, framed an Amnesty Scheme, and according to that scheme, found the assessee to be entitled to the benefit of Scheme, and thus the penalty imposed was set aside. However, in some cases where the penalty to the extent of 25%, which was deposited by the assessee, was maintained, and ....
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....aunched an extra-ordinary taxpayer friendly Scheme for registration of those service providers who have not got themselves registered so far. The details of the scheme are enclosed as annexure. This scheme aims to register all service providers on the basis of their declaration and who had earlier failed to register themselves with the department due to ignorance or any other reason with full waiver of penalty. This scheme is effective with immediate effect. As per the scheme any service provider can make a declaration to the department with regards to his past liabilities towards the service tax and interest payable. Without any inquiry or questions, the departmental authorities will accept the declaration and on the spot give a registration to the service provider, Penal proceedings against the person approaching under this scheme will be completely waived off. This scheme commences with immediate effect and will be operational only up-to 30^th October 2004 and no extension will be allowed. You should publicise the scheme and organize sufficient numbers of camps to facilitate the service providers who wish to avail of the relaxations given under the scheme through out your ....
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.... taxable services rendered Service Tax payable Interest payable, if any 6. The declaration with regards to the Service tax and interest payable given above is correct and true to the best of my knowledge. 7. Along with this declaration I am enclosing the details in Form ST 1 for being registered with Service Tax department. 8. Signature :________________________________ 9. Place :___________________________________ 10. Date :___________________________________ Notes: (a) The service tax is payable @ 5% upto 14th May 2003, 8% for period between 14th May 2003 and 10th September 2004 and 10% for period after 10th September 2004. (b) For period after 10th September 2004, education cess @ 2% of Service Tax payable is also to be paid. (c) Interest is payable @ 24% upto 11th May 2002, 15% for period between 11th May 2002 and 10th September 2004 and 18% for period after 10th September 2004. (d) In case where services have become taxable from date in middle of Financial Year indicate turnover from that date. ________________....
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....evenue Central Board of Excise and Custom New Delhi, the 22nd September, 2004 To All Chief Commissioners of Central Excise. Subject: Extra-ordinary taxpayer friendly scheme for registration of service providers. I am directed to refer to the D.O. of even number dated 20th September, 2004 on the above mentioned subject. D.G.(ST) has pointed out some error in the annexed "declaration form". The revised declaration forms are enclosed herewith for necessary action at your end. Yours faithfully, Sd/- Encls:As above &nbs....
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....________________________ Notes (a) The service tax is payable @ 5% up to 14th May 2003, 8% for period from 14th May 2003 and upto 9th September 2004 and 10% from 10^th September 2004. (b) For period from 10th September 2004, education cess @ 2% of Service Tax payable is also to be paid. (c) Interest is payable @ 24% up to 11th May 2002, 15% for period from 11th May 2002 and up-to 9th September 2004 and 13% from 10th September 2004. (d) In case were services have become taxable from date in middle of Financial Year indicate turnover from that date. _________________________________________________ Acknowledgement To, ___________________ ___________________ ___________________ Sir, Your declaration dated __________ has been received. Your registration number in form ST2 is enclosed. You should deposit the amount of Service Tax and interest as indicated by above within seven days and report compliance. Encl: Form ST-2 Signature of the Officer receiving the declaration Place: ____________________ Date: ____________________ ***************** 8. Firstly the question is, as to whether this scheme has a statutory force, so as to term....
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.... pipe of the Central Excise Board, it does not have the effect of clothing it with statutory powers, or to attach to it statutory efficacy available consequent upon Section 37 and Section 37B. Thus, in our view, it cannot be said to be statutory notification, issued in exercise of powers under Section 37B. 10. Then, the question is, as to what is the nature of this communication, and the obvious answer is, that it is only an administrative instruction, issued by the Hon'ble Finance Minister, purportedly, to provide benefit to the persons, who earlier failed to register themselves with the department, and in substance is intended to cast the net of service tax wider and wider, and in order to augment the revenue the concessions provided in the communication were sought to be thrown open. Obviously, therefore, the communication has to be read, interpreted, understood, and appreciated, with this spirit, viz. to provide benefit to the defaulters on the one hand, and to cast the net of service tax wider and wider, so also to augment the revenue, on the other hand. 11. With this preface, it may also be noticed, that the term "Scheme" as such has very many parameters to be....
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....1 (134) E.L.T. 327 (S.C.) = AIR 2002 SC 74. In this case, there was an amnesty scheme, wherein where the assessee had wrongly availed the credit of MODVAT on inputs, and availed the duty free clearance of the goods, claiming exemption under Notification No. 203/92, under the Value Based Advance Licence, in cases, where the assessee was not entitled to avail MODVAT credit, he was required to reverse it, and to pay interest, and other consequences were to flow, for that, an amnesty scheme was floated, requiring interest to be deposited for the period between the date of export and date of reversal, which interest was required to be deposited by 31.1.1997. In that case, the amount was deposited on 7.2.1997 only. In that background, interpreting the scheme, it was held, that such scheme or exemption notification have to be strictly construed, and that the provision in the notification, for deposit of interest by the specified date, has to be interpreted strictly, in the manner stated in the notification, and on no other basis. It was held, that it is well settled, that in taxing statute there is no room for any intendment, and regard must be had to the clear meaning of the words, and t....
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....er any service provider, who got registered upto 30.10.2004, are not liable for any penal action and thus, in view of the immunity from penal action, no penalty could be imposed on the assessee, as they had paid service tax prior to 30.10.2004. A contention was raised therein, that the assessee was already registered prior to the floating of the scheme and, therefore, are not entitled to benefit of scheme, and it was held, that the service provider who got registered, and paid service tax, during Extra Ordinary Tax Payer Friendly Scheme upto 30.10.2004, are not liable to pay any penalty, therefore, no infirmity was found in the order of the Commissioner, as the assessee had paid service tax prior to 30.10.2004, they are not liable to any penalty. This judgment is dated 13.6.2005 (28.4.2005). 19. Then the learned counsel placed reliance on a judgment rendered by a learned Single Member M.V. Ravindran dt.5.12.2006, rendered in Appeal No.312/2006, which has been passed, following the judgment in Amit Kumar Vs. CCE, Jaipur-II, reported in 2006 (2) S.T.R. 506, and C.C.E. Bhopal Vs. Bharat Security Services & Worker's case. It would suffice to say, that Appeal No. 54/2007 in this ....
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....s the penalty was set aside. 23. The next case relied is again of Tribunal West Zonal Bench, Mumbai dt.28.5.2007, in Arc. Dinesh Burad Vs. Commissioner of Central Excise and Customs, rendered by learned Member, M.V. Ravindran reported in 2008 (11) S.T.R. 250 (T) = (2008) 12 STT 47. In this case, the assessee failed to pay service tax from October 2001 to March 2003, and had paid the entire amount of service tax by 1.3.2004. The adjudicating authority imposed penalty of Rs.500/-, the Commissioner enhanced the penalty. In further appeal to the Tribunal, the Tribunal found, that the Central Government of India came out with the Extra Ordinary Tax Payer Friendly Scheme, for those persons who were not registered and were not paying service tax. The said scheme operated on the basis, that any person who has not registered but gets himself registered and discharged service tax liability and interest before 30.10.2004, no penal provision could be invoked against such assessee. Then also proceeded to rely upon Bharat Security Services & Worker's case, and penalty was set aside. 24. The next case relied upon is again of Tribunal West Zonal Bench, Mumbai dt. 27.6.2008, rendere....
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....ational, should be denied the benefit of waiver of the penal provisions referred to above for late registration, delay in filing of relevant returns etc. all of which are procedural in nature. In view of my aforesaid findings, I am inclined to waive the penalties imposed on the said party." 27. And thus the finding was upheld by the learned Tribunal, in view of the aforesaid circular dt.23.9.2004. 28. Then the next judgment relied upon is dt.18.1.2006, of the Principal Bench New Delhi rendered by the same learned Member, M.V. Ravindran in Commissioner of C. Ex. Vs. R.K. Electronics Cable Network reported in 2006 (1) S.T.R. 233, wherein also the Commissioner had practically recorded identical finding, as recorded in Kamlesh Kumar's case, and learned Tribunal relying upon the judgment in Bharat Security Services & Worker's case upheld that order. 29. The last case relied upon is judgment dt.29.2.2008, rendered by West Zonal Bench at Ahmedabad, in Jay Security Services Vs. Commissioner of Customs, C. Ex. and Service Tax, reported in 2008 (10) S.T.R. 602, rendered by the learned Member Archana Wadhwa. In that case, the period involved was April 1999 to March 2004....
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....ober 2003, and when the department asked the assessee to pay tax, then they took registration and paid service tax, and submitted the return in October 2003, and that the tax was paid by them only after adjudication of the proceedings, therefore, they are not covered by the voluntary disclosure scheme. On the other hand, reliance was placed on the said circular. The learned Tribunal noticed, that the Commissioner had dropped the penalty, on the ground, that under the said circular, when the assessee, who did not at all comply with the service tax law, can be given immunity, provided they pay service tax with appropriate rate of interest, and there is no tangible and logical reason as to why the law abiding assessee, who had got himself registered more or less in time, and had also started paying the service tax in time, much before the new scheme became operational, should be denied the benefit of waiver of penalty. The learned Tribunal found, that the circular was only with respect to those service providers, who had earlier failed to register themselves due to ignorance or for any other reason, and who came forward and paid the past liability within the period prescribed under th....
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....aken registration, or were paying service tax. It was also found, that it is evident from the wordings of the scheme, as announced under the circular dt. 20.9.2004, that it was intended only for instant registration of service providers, who could make declaration to the department, with regard to past liabilities towards the service tax and interest payable. Then, the case was considered on merits, and the liability was upheld. 32. At this place we may observe, that these two cases in Mankodi Entriprises and Pankaj Oil Trading Coporation are not the cases regarding the payment of service tax after registration, as assumed by the learned Member in Jay Security Services' case, for distinguishing these two judgments. Be that as it may. The fact also does remain, that in Jay Security's case, the amount did involve the amount for the period, which included the period after registration, inasmuch as the period involved was April, 1999 to March, 2004, while the assessee was registered on 29.9.2003. Thus, in a way the judgment in Jay Security Services' case is required to be considered to take a view, that even in cases where the amount relates to period prior to registrati....
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....he other equally important aspect of the matter is, that admittedly, the Revenue, in all, or even in any of the matters, which judgments have been referred to and relied upon by the learned counsel for the assessee, except that Bohra Pratisthan's case [2007 (8) S.T.R. 278 (Tribunal)], which under appeal before this Court, has not challenged further. We are aware of the judgment of the Hon'ble Supreme Court in C.K. Gangadharan's [2008] (228) E.L.T. 497 (S.C.)],case, which has also been relied upon by the learned counsel for the Revenue, but then, in that case the Hon'ble Supreme Court has held, that merely because in some cases the Revenue has not preferred appeal, that does not operate as a bar, for the Revenue to prefer an appeal in another case, where there is just cause for doing so, or it is in public interest to do so, or divergent views are expressed by the Tribunals or the High Courts. (Emphasis Supplied) 40. To say the least, the present situation, in view of the things discussed above, does not fall, within any of the exception laid down by the Hon'ble Supreme Court in para-13 of the judgment in C.K. Gangadharan's case, and therefore, it ha....
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.....9.2004 or 23.9.2004, or from the date the person concerned comes to know of it. The significance of this confusion is, that if the interpretation sought to be projected by the Revenue is taken, and if it is considered that the Scheme commenced on 23.9.2004, then even the person, who may have got himself registered on 21.9.2004, and happened to be defaulter, will have to be denied the benefit of immunity, or even the person who got himself registered on 22.9.2004, and is a defaulter will have to be denied the benefit of immunity, while on the other hand if it is taken to have commenced on 20.9.2004, then such person will get the benefit of immunity. Thus, the person even without knowing of the scheme, may have got himself registered on 21.9.2004, and would be in dilemma as to whether he is to get benefit of the immunity or not, such interpretation cannot be put on the Amnesty Scheme. Obviously the communication dt. 20.9.2004 does not prescribe the precise starting point of time of the scheme. 44. Carrying the things further logically, if the scheme is taken to have commenced on 20.9.2004, then if the benefit is available to the person who gets himself registered on 20.9.20....