TaxTMI 
TaxTMI 
2023 (4) TMI 768
X X X X Extracts X X X X
X X X X Extracts X X X X
....dictional superintendent sent a letter dated 21.09.2012 requesting the appellant to file the ST-3 return but the appellant did not respond. A reminder was sent on 6.8.2013 and then a summons dated 20.11.2013 was issued by the superintendent to the appellant. Shri Rao, the proprietor, appeared and gave a statement on 15.5.2014 in which he stated that they have been providing repair and maintenance service since 2009 and have also been providing manpower for repair and maintenance. He also confirmed that they collected over Rs. 15 lakhs as service tax from the clients and had not deposited this amount with the Government. He claimed that he was ignorant of service tax rules and when he realized his mistake, he wanted to deposit the amount but could not do so because his family met with an accident and was hospitalized and that he will pay be service tax within four months. He also said that he would file ST 3 returns within a week. 3. However, he neither deposited the service tax nor submitted the details of the payments which he had received for the services. So, Shri Rao was again summoned on 12.9.2014 and another statement was recorded. He submitted that he had deposited Rs. 5,40....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... The service tax amounting to Rs. 5,40,000/- already paid by the Noticee is ordered to be appropriated against the demand of service tax confirmed. (ii) I order recovery of interest at appropriate rate from the Noticee on amount of Rs. 37,88,890/- not paid/late paid under Section 75 of the Finance Act, 1994, (iii) I impose a penalty of Rs. 10,000/- under Section 77 (2) of the Finance Act, 1994 for failure to file the ST-3 Returns. (iv) I impose a penalty of Rs. 37,88,890/- under Section 78 of the Finance Act 1994 for suppressing the value of taxable services provided by them with intent to evade the payment of service tax. (v) I impose a late fee of amount not exceeding Rs. 20,000/- for failure to file each of the Statutory ST-3 Return for the period 2009-2010 to 2013-2014 under Section 70 of the Finance Act, 1994 read with rule 7 of the Service Tax Rules 1994 (vi) I impose a penalty under Section 77 (1) (c) (i) & (ii) of the Finance Act, 1994 for failure to furnish the information/documents @ 200/- for every day during the period 20.11.2013 to 10.10.2014 (i.e., the period during which failure continued) or penalty upto Rs. 10,000/- whichever is higher". 7. This appeal is ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... a reminder, the jurisdictional Superintendent issued summons to record his statements. In the statements, he admitted that he had collected amounts as Service tax and not deposited them in the Government exchequer. In his second statement, he said that he had deposited part of the amount which he had collected in the Government account. Ignorance of law is not an excuse and the appellant seems to be selectively ignorant of law. He collected service tax from the clients but was ignorant that it had to be deposited with the Government and that he had to file ST-3 Returns. If he was ignorant, he should have at least filed the returns after receiving a letter from the superintendent. He did not and waited until he was compelled by summons to appear. When the appellant was asked for details of his business activity, he said that he did not have any ledger or balance sheets and that his invoices were destroyed. He, however, provided Form 26AS issued by the Income tax department. Since most of his clients were large, organized firms, they would deduct tax at source and issue Forms 16A with the income tax which shows how much amount has been paid and how much was deducted as tax. The data....
X X X X Extracts X X X X
X X X X Extracts X X X X
....h Central Government. - (1) Any person who is liable to pay service tax under the provisions of this Chapter or the rules made thereunder, and has collected any amount in excess of the service tax assessed or determined and paid on any taxable service under the provisions of this Chapter or the rules made thereunder from the recipient of taxable service in any manner as representing service tax, shall forthwith pay the amount so collected to the credit of the Central Government. (2) Where any person who has collected any amount, which is not required to be collected, from any other person, in any manner as representing service tax, such person shall forthwith pay the amount so collected to the credit of the Central Government. (3) Where any amount is required to be paid to the credit of the Central Government under sub- section (1) or sub-section (2) and the same has not been so paid, the Central Excise Officer shall serve, on the person liable to pay such amount, a notice requiring him to show cause why the said amount, as specified in the notice, should not be paid by him to the credit of the Central Government. (4) The Central Excise Officer shall, after considering the re....
X X X X Extracts X X X X
X X X X Extracts X X X X
....element is also absent in the invoices, which statutorily categorise the services renderd by the Noticee under respective heads of taxable services as standalone services. As such these services cannot be accommodated under 'Composite Work Contract Service'. (emphasis supplied) 13. The lower authorities have erred in holding that to qualify as the Works Contract Service, VAT or Sales tax must have been paid and even if some material is involved, if no VAT is payable, the contract will not be a Works Contract Service. There are (a) contracts for supply of goods; (b) contracts for providing services; and (c) contracts which involve both, i.e., provide services along with the goods required to provide such services. The third category of contracts are a separate species of contracts known to trade and are called 'Works Contract Service'. There is no actual sale of goods but there is deemed sale of the goods which have been used while rendering the service. The deemed sale of the goods is exigible to VAT but it is not necessary that VAT has to be charged or must be chargeable in every such transaction. No VAT may be payable on some goods under the state laws but that does not convert ....