TaxTMI 
TaxTMI 
2025 (10) TMI 729
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....ounting to Rs. 12992.13 Lacs is considered as taxable value. (ii) Service Tax amounting to Rs. 19,46.95,8 10/- (Rs. Nineteen Crore, Forty Six Lacs, Ninety Five Thousand, Eight Hundred and Ten only) (Service Tax Rs. 18,18,89,820/-+ Swachch Bharat Cess Rs. 64,96,065/- + Krishi Kalyan Cess Rs. 63,09.925/-), leviable on taxable services so rendered for the period 14.03.2016 to 30.06.2017 is confirmed and is ordered to be recovered from the Noticee under proviso to section 73(1) of the Finance Act, 1994. The Noticee is directed to pay the same forthwith (iii) Interest on the amount of Service Tax Rs. 19,46,95.810/- (Rs Nineteen Crore, Forty Six Lacs, Ninety Five Thousand, Eight Hundred and Ten only) so confirmed at Sr. No. (ii) above is ordered to be recovered from them under Section 75 of the Finance Act, 1994. The Noticee is directed to pay the same forthwith. (iv) Penalty equal to amount of service tax short/not paid amounting to Rs. 19,46,95,810/- (Rs. Nineteen Crore, Forty Six Lacs, Ninety Five Thousand, Eight Hundred and Ten only) is imposed under Section 78 of the Finance Act. 1944 and ordered to be recovered from the Noticee. The Noticee is directed to....
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....st "Manpower recruitment or supply agency" services which appears to be covered under the category "service` as defined under Section 65B (44) [erstwhile Section 65(105)k] of the Finance Act, 1994. The said services are also not specified in the negative list under section 66D of the Finance Act, 1994a and thus, appear to be taxable in terms of section 66B of the Finance Act 1994 2.3 They have collected an amount of Rs. 138.93 Lacs as "Misc. Receipts/ Recovery", in relation to which, they have not provided any particulars as to under which service such amount has been collected. By not providing certain information/bifurcation of the amount collected under the head "Misc. Receipts/Recovery". 2.4. They have also received income of Rs. 5.16 Lacs from 'renting of immovable property' under the head "Rent from Resi. Orts Post Office & Bank. The "renting of immovable property services" provided by the appellant appeared to be taxable. 2.5 Thus, during the said period, under the heads Revenue Proceeds from Examination", "Misc. Receipts/ Recovery" and "Rent from Resi. Orts Post Office & Bank", the Noticee has received taxable amount of Rs. 12992.13 Lacs, on which they appe....
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....ntative for the revenue. 3.2 Arguing for the appellant learned counsel submits that:- ⮚ Appellant is deemed as the state Government - decision rendered by the Hon'ble Madhya Pradesh High Court in Writ Petition No 3867 of 2016; ⮚ Board is not "Manpower Recruitment or Supply Agency as defined under Section 65 (68) of the Finance Act, 1994. ⮚ Neither Service Provider nor the service recipient are person under Section 65 (105) (k) of the Finance Act, 1994. ⮚ There is no flow of consideration from the service recipient to the service provider. ⮚ The services were rendered by the appellant to the State Government and hence are exempt under S No 39 of the Exemption Notification No 25/2012-ST dated 20.06.2012. 3.3 Authorized Representative reiterated the findings recorded in the impugned order. 4.1 We have considered the impugned order along with the submissions made in the appeal and during the course of arguments. 4.2 Impugned order records the findings as follows: 14. Before proceeding to adjudge the impugned issue on merits, it will be appropriate to examine the veracity of the submissi....
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.... Receipts/ Recoveries 0.01 2.74 136.18 138.93 Receipts-Misc Receipts/ Recoveries - (rent from Resi Qrts Post Office & Bank 0.15 4.53 0.48 5.16 Total Receipts 372.28 8148.74 4471.11 12992.13 The computation of Service tax is tabulated as under: Period wise and total receipts wise calculation of service tax 14.03.2016 to 31.03.2016 01.04.2016 to 31.03.2017 01.04.2017 to 30.06.2017 Total Service Tax Payable Service Tax Payable @ 14% 52.12 1140.83 625.95 1818.9 Swachchh Bharat Cess @0.5% 1.86 40.74 22.36 64.96 Krishikalyan Cess @0.5% 0.00 40.74 22.36 63.1 Total Service Tax 53.98 1222.31 670.67 1946.96 16. The above issues wrapped up into the issuance of a show cause notice bearing no. 12/COMMR/ST/BPL-I1/2018 dated 24.05.2018 proposing recovery and demand of Service tax to the tune of Rs. 19,46,95,810/- in terms of the proviso to Section 73 (1) of the Finance Act, 1994 along with interest under Section 75 of the Act, ibid. It was also proposed to impose penalty under Section 76, 77(1)(a), 77(2) & 78 for failure to pay service tax by the notice, by ....
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....are being raised in respect of such activities. It is further understood that the notice did provide no rebuttal in respect of their alleged liability against the Receipts under head Misc. Receipts Recoveries- (Rent from Resi. Orts, Post Office & Bank). In such a case, it is amply clear that the noticee does not have any counter argument against the categorical allegations aised in the show cause notice in respect of receipts on the account of rent received from Post office and bank. Remaining silent about the issue can be appropriately construed as self-admittance of the offence. I, therefore, do not find any requirement to further discuss the particular issue as, the same on merits goes affirmative towards the charges so alleged in the show cause notice. So, I conclude that the notice have rendered themselves liable to pay Service tax on such receipts against *renting of immovable property service collected by them during the period from 14.03.2016 to 30.06.2017. Held accordingly. 19. Further, on the issue of receipts against conduct of examination etc. with reference activity of recruitment of the appearing candidates. after hearing both sides of arguments, I opine that....
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.... the Act. - Section 3(42) of the General Clauses Act, 1897 provides that 'person' shall include any company or association or body of individuals, whether incorporated or not. - Section 3(2) of the Madhya Pradesh Vyavasayik Pariksha Mandal Adhiniyam, 2007 provides that "the Board shall be a body corporate by the name of Madhya Pradesh Professional Examination Board and shall have perpetual succession and a common seal with power to acquire and hold property, both movable and immovable and shall have power to transfer any property held by it and may sue or be sued in its corporate name." 22. Thus, under the Vyapam Act, the Board has been established as a body corporate and not as a department of the State Government. Therefore, the Noticee is a legal person/entity different from the state government. A body corporate is an artificial person having perpetual existence, different from the members constituting it, who may change or be replaced by others from time to time. Therefore, only because the Chairperson of the Board is appointed by the government and the ex- officio and nominated members of the Board are government officers from different depa....
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.... in the negative list, provided or agreed to be provided in the taxable territory by one person to another and collected in such manner as may be prescribed. Thus, all services except those specified in the negative list were taxable under Section 66B of the Act, w.e.f. 01.07.2012. 28. The arguments advanced by the notice are that they have not charged the service tax separately from the organizations viz. govt. deptts. for whom, they are organizing the examinations. The fee for such arrangement is being collected from the appearing candidates and for that no separate bills are being raised in respect of such activities. Here, I observe that such arguments iven by them in support of their claim are not of any help to them in view of the following: The activity undertaken by the Noticee for selection of personnel for the various organizations undisputedly comprises of (i) advertising the vacancies in the news papers, (ii) preparing question-papers, (iii organizing examinations at various centers (iv) conducting personal interviews and (v) submitting the post and category wise selection list and waiting list to the concerned organization. As per th....
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....r providing the taxable services of "manpower recruitment‟ and declared service, the Noticee has received amounts in the form of examination fees and miscellaneous receipts/ recoveries from the candidates and has also charged amounts from the service recipient organizations. Accordingly, Service Tax is to be charged on the gross amounts received by the Noticee for providing the "manpower recruitment service` and `renting of immovable property services`. 32. Thus, from the above, it is clear that the Noticee is engaged in providing the service of "Manpower recruitment or supply agency‟ as defined under erstwhile Section 65(105) of the Finance Act, 1994. which is taxable service during the relevant period under Section 65B(44) of Finance Act, 1994 w.e.f. 01.07.2012 and 'renting of immovable property service which is declared service. Consequently, the consideration received by them w.e.f. 14.03.2016 against the above services, being provided by them as person or body corporate/corporation board enacted under Madhya Pradesh Vyavshayik Pariksha Mandal Adhiniyam, 2007, is taxable under the provisions of the Finance Act, 1994. It is also noticed that as per Secti....
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....recovery, provided by them on which service tax amounting %o RS. 19.46.95.810/- (Service Tax Rs. 18,18.89.820/ + Swachh Bharat Cess Rs. 64,96,065/- + KrishiKalyan Cess Rs. 63,09,925/-) (as detailed in table) during the period from 1403.2016 to 30.06.2017 is liable to be deemed and recovered from them under section 73(1) of the Finance Act, 1994 and thus, the same is taxable in terms of section 66B of the Finance Act. 1994. 37. It is clear from the above table that the noticee has collected an amounts of Rs. 12848.04 Lacs as examination fee against " Manpower recruitment or supply agency' services during the period from 14.032016 to 30.06.2017, which is covered under the category of 'service? as defined under Section 65B (44) [erstwhile Section 65(105)k] of the Finance Act, 1994. The said services are also not specified in the negative list under section 66D of the Finance Act, 1994 and thus, the same is taxable in terms of section 66B of the Finance Act, 1994. 38. The Noticee have also collected an amount of Rs. 138.93 Lacs as "Misc. Receipts/ Recovery", in relation to which, they have not provided any particulars as to under which service such amount has ....
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....e periodical ST- 3 returns and pay the service tax at appropriate rate in respect of services provided under the category of "Manpower recruitment and supply" and renting of immovable property' services. The fact came to the Deptt's knowledge only when investigation proceeding was initiated against them and at no point of time, they disclosed to the Department, in any manner, that they were providing/receiving the above discussed taxable services and was liable to pay service tax on the same. This material fact was unearthed only after the department initiated on inquiry against hem and had the deptt. not conducted rigorous investigation against them, this evasion would have remainec undetected. They have not discharged their tax liability even after initiation of Investigation by the deptt. against them. From these facts, it is clear that the Noticee has deliberately suppressed the material facts from the department and contravened the various provisions of service tax as detailed above with an intent to evade the payment of service tax. Hence, the above amount of service tax not-paid by the Noticee amounting to Rs. 19,46,95,810/- (Service Tax Rs. 18,18,89.820/-) + Swachh ....
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....of the services so rendered by the notice as a service which is correctly categorized under *taxable Services during the period from 14.03.2016 to 30.06.2017. In the month of June, 2012, Service tax law. which was earlier based on a definitive listing wherein only specified services were taxed, was revamped and got replaced by a "negative list" concept as a result of which all "activities" undertaken for some consideration were made subject to service tax except those service activities which are either specified in the negative list or are specifically excluded from the definition of term "service`. Under the amended provisions of FA, 1994, the impugned service continued to be taxable during the relevant period. In the given facts and circumstances, I am inclined to hold to affirm the allegations levelled n the impugned Show Cause Notice and do not stumble on any requirement to further discuss the other provisions of FA,1994 relevant to determine the other liabilities of taxable persons in relation to the services so rendered and the valuation part thereof. The same is already narrated in the notice itself and is not rebutted by the notice. Held accordingly 45. I also not....
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.... on the services provided by him and thereafter furnish return to the jurisdictional Superintendent of Service Tax by disclosing wholly and truly all materials facts in ST-3 returns. The Assessee have not disclosed full true and correct information about the value of the service provided by them and have thereby deliberately suppressed essential and material information from the department about the services being provided and the value of taxable services realized by them by not furnishing periodical ST-3 returns with an intent to evade Service Tax. Therefore in this case, all the essential ingredients exist to rightly invoke the extended period in terms of proviso to Section 73(1) of the Finance Act, 1994 to demand the service tax so evaded. I, therefore. hold that the noticee have evaded the service tax amounting to the tune of RS. 19,46,95,810/- by resorting to willful suppression of facts and have contravened various provisions of the Finance Act. 1994 and Rules made there under (as discussed in the preceding & succeeding paras) with intent to evade payment of the same as discussed hereinabove. Hence Service tax amounting to Rs. 19,46,95,810/- is determined to be recoverable f....
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....ms Private Limited [Order dated 04.01.2024 in W.A.Nos. 2638 of 2019] observed as follows: "12.......The question as to whether a particular transaction would attract the levy of Service Tax as constituting a taxable service within the meaning of 65 (105) (zzzzt) prior to 01.07.2012 or Section 66B read with Section 65B(44) and Section 66E(c) w.e.f. 01.07.2012 ought to be determined on the basis of the contracts entered into between the service provider and the recipient. One cannot generalize the transactions nor determine the liability without examining the contracts individually for the rights/ obligations flowing therefrom may vary from contract to contract. ....." 4.5 In case of Indian Machine Tools Manufacturers Association [Final Order No. 60403/2023, dated 18.09.2023 in Service Tax Appeal No.4174 Of 2012 - Chandigarh] "11. Coming to third and final issue as to whether any demand can be sustained on the basis of difference between the figures of ST-3 Returns and the balance sheets, we find that it is a settled principle of law that service tax can be levied only when there is a clear identification of service provider, service recipient and consideration p....
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....rtain regulations in relation to the subjects reported in Section 24 (2) (a) of Madhya Pradesh Professional Examination Board Act 2007. Regulation 2, named as Madhya Pradesh Vyavsayik Pariksha Mandal-Fees for Admission to the Examination of the Board Regulations, 2020, provides for manner of fixation of fees to be collected. These parameters are reproduced below: 5. Parameters for Fee Fixation:- The examination Fee Fixation Committee shall take into consideration of various parameters including the following parameters for making recommendations to the Chairperson on the fixation of fee for various examination: (a) Cost of advertisement and mode of submission of Application Form; (b) Cost of question paper preparing and deployment/ printing. (c) Cost of exam related material, website and data handling and Cost of expenditure incurred in exam centre preparation. (d) Cost of inspection and fixation of examination venues. (e) Cost of Implementation Agency. (f) Expenditure on setting and printing or online deployment of Question Booklets. (g) Expenditure for conducting of examination like remuneration to Observers,....
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....t has held as follows: "18. The question of charging service tax however, needs to be looked from a slightly different angle. Section 66 of the Finance Act, 1994, as noted, provides for levy of taxes at the rate of prescribed percentage of the value of taxable services referred to in various sub-clauses of clause (105) of Section 65. For applicability of this charging section, therefore, what is needed is to ascertain the value of taxable service. In other words, service tax can be levied only if the service is provided, even if it is otherwise, a taxable service, carries a certain value. If the value of service provided is nil, there would be no occasion for charging the service tax. In essence, thus, Section 66 aims at collecting service tax when a certain service is provided for a value. To put it conversely, when the service is provided but no value thereof is charged, there would be no question of collecting service tax. No provision has been brought to our notice in the Finance Act, 1994 under which though the service provider has not charged any value for service, service tax thereon still can be levied on its deemed value, be it market value or fair value. It is a ....
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....or invoking the extended period of limitation for making the demand. Thus we uphold the demand of service tax (inclusive of cess) along with the interest and penalties (Section 78) imposed in respect of these categories of receipt. 4.14 Since impugned order itself concludes in the favour of invocation of extended period of limitation for making the demand the penalties under Section 76 cannot be justified. 4.15 The penalties have been imposed under Section 77 (1) and 77 (2) for not obtaining the registration and for not filing the ST3 returns. We find enough justification in the penalties imposed under these two sections in view of decision of Hon'ble Supreme Court in case of Gujarat Travancore Agency [1989 (42) E.L.T. 350 (S.C.)] wherein following has been held:- 4. Learned Counsel for the assessee has addressed an exhaustive argument before us on the question whether a penalty imposed under Section 271(1)(a) of the Act involves the element of mens rea and in support of his submission that it does he has placed before us several cases decided by this Court and the High Courts in order to demonstrate that the proceedings by way of penalty under Section 271(1)(a) of t....