TaxTMI 
TaxTMI 
2026 (7) TMI 1003
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....d with section 73(1) of the Finance Act, 1994. (ii) I order to recover due interest at appropriate rate on the confirmed tax amount as referred at (1) above, under Section 75 of the Act, ibid. (iii) I impose a penalty of Rs.250080/- upon the party under the provisions of Section 78 of the Act. However, the party has an option to pay 25% of the penalty payable as discussed above. (iv) A penalty of Rs.10,000/- is imposed upon the party under the provisions of Section 77(1) of the Act for failure to get them registered under Section 69 of the Act read with Rule 4 of the Rules. (v) A penalty of Rs.10,000/- is also imposed upon the party under the provisions of Section 77(2) of the Act for failure to abide by the provisions of Section 70 of the Act, ibid read with Rule 7 of the Rules. 2.1 The Appellant is an individual who was granted a mining lease/license by the State of Uttar Pradesh for the extraction of minerals (sand/stone) in Sonebhadra. Appellant was not registered with the department nor was paying any service tax either on forward basis or on reverse charge basis in respect of the services provided or received by him. 2.2 On the basis ....
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.... tax shall himself assess the tax due on the services provided by him and shall furnish to the Superintendent of Central Excise, a return in such form and in such manner and as such frequency and with such late fee not exceeding twenty thousand rupees, for delayed furnishing of return. Every assessee shall submit a half yearly return in Form ST-3 or ST-3A in triplicate, along with a copy of challan for the months covered in the half yearly return by the 25th of the month following the particular half year in the form & manner as notified by the Government. Failure of furnish the above returns in due time is liable to imposition of penalty under Section 77 of the Act. On verification of the Status of ST-3 on AIO portal, it transpired that the appellant have not filed the ST3 Returns during the period 2016-17 (April to September); 2016-17 (October to March) & 2017-18 (April to June). 2.6 Appellant has thus contravened the following provisions of law:- (a) Section 68 of the Finance Act, 1994 read with Rule 6 of the Service Tax Rules, 1994, in as much as, they have failed to pay Service Tax for the said Services rendered by them. (b) Section 70 of the Finance Act, ....
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.... Finance Act, 1994 for Violation of Section 70 of the Finance Act, 1994 read with Rule 7 of Service Tax Rules, 1994 by not filing the ST-3 Returns to the department 2.9 The show cause notice was adjudicated as per the order in original No 397-ST/2023 dated 23/02.2023, confirming the demand of service tax along with interest. Penalties were imposed under Section 77 (1), 77 (2) and 78 of the Finance Act, 1994. 2.10 Aggrieved appellant filed appeal before Commissioner (Appeal) which was disposed of by Order in Appeal No 968/ST/ALLD/2023 dated 24.05.2023 remanding the matter back to original authority observing as follows: "I therefore find that the issues with respect to the classification of the services provided, their taxability, and re-quantification of the taxable value, needs fresh examination, after ascertaining the nature of activities performed by the appellant against which they had received the payment during the material period." 2.11 The show cause notice was adjudicated in remand proceedings as per the order in original referred in para 1 above. Aggrieved appellant filed the appeal before Commissioner (Appeal) which has been dismissed as per the impugne....
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.... held that the appellant were liable to pay service tax under reverse charge mechanism. In support the judgement of Hon'ble Supreme Court in the case of Mineral Area Development Authority & another v/s M/s Steel Authority of India and another etc (Civil Appeal No. 4056-4064 of 1999) dated 25.07.2024 was cited wherein it was held that Royalty was not a tax but is contractual consideration paid by the mining lessee to the lessor for enjoyment of mineral rights. Besides vide clarification issued by CBEC vide Circular No. 192/02/2016-ST dated 13.04.2016 also made it clear that the activity undertaken by government or local authority against a consideration constitutes a service and the amount charged for performing such service is liable to service tax. 5.4 After going through the material available on record I find that as per the clarification made by the CBEC vide Circular No. 192/02/2016-ST dated 13.04.2016 Royalty is a contractual consideration against a service. There is no dispute in as much as the appellant has provided mining services to the government of UP against which they have paid fees in the nature of royalty. As per the terms of Notification No. 25/2012-ST....
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....he liability of tax liability on the appellant under reverse charge mechanism, I find that the provisions of Notification No. 30/2012-Service Tax dated 20.06.2012 as amended by Notification No.18/2016Service Tax dated 01.03.2016, it is clear that the services provided by the Government or a local authority to any person are chargeable to service tax under Reverse Charge Mechanism (RCM) and 100% of the service tax liability has to be discharged by the service receiver i.e. Licensee in the instant case. From the above, it is clear that the services received by the applicant are squarely covered under taxable service in terms of amendment made in Notification 25/2012-Service Tax dated 20.06.2012 through Notification No. 22/2016-Service Tax dated 13.04.2016 read with Circular No. 192/02/2016-Service Tax dated 13.04.2016. 5.8 That appellant has also contended that taxable value considered by the department is below threshold limit hence the appellant is entitled for SSI Exemption. However, I find that the appellant have not submitted proper and adequate documents to examine the fulfilment of conditions prescribed in Notification No. 33/2012-St dated 20.06.2012. They have stated....
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....it is a serious lapse if a judge relies on such a fake or hallucinated AI-generated material as precedents in support of the determination. We have no hesitation in declaring that such a decision is no decision in the eyes of the law, irrespective of whether such material had a direct or indirect bearing on the decision-making. Such decisions are to be set aside even if an iota of fake or hallucinated material enters the decision-making process, as it would violate the sanctity of adjudication. It is absolutely necessary to maintain integrity in decision making, and we reiterate and declare zero tolerance for the Bar as well as the Bench to cite, refer to, or rely on such material. It is also clarified that our judgment shall have no bearing on the rightful use of AI, but on the presentation or reliance on fake or hallucinated material as if it were a court precedent. 8. We are aware that mere declaration of prohibitory action is not sufficient; there must be a consequential action following accountability. 9. So far as the responsibility of the bar is concerned, we direct the Bar Council of India, being the apex statutory body, to constitute a committee and delib....
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....llows: "By the impugned order1, the demand along with interest and penalty has been confirmed against the appellant. The allegations against the appellant is that he has not paid the service tax under the Reverse Charge Mechanism on Royalty paid to the Government...... 2. The Principal Bench in the Final Order No.50660 of 2023 dated 09.05.2023, titled as The Principal Commissioner, CGST & Central Excise, Bhopal vs. M/s. S. R. Traders, relied on the decision of the Tribunal in M.P. State Mining, which we may refer herein below: "13. The second category of demand pertains to the alleged short-payment of tax to the extent of dead rent surface rent paid by the appellant to the State Government, which has been held to be taxable on reverse charge basis against the receipt of service concerning grant of mining rights. 14. The contention of the learned counsel for the appellant is that the demand is not sustainable as the service was received prior to 01.04.2016, when such services from the Government were not subject to tax. 15. The charging provision prescribing levy of tax is section 66B of the Finance Act and it is as follows: "66B. There s....
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....tate Government by virtue of the agreement dated 02.01.2016 and, therefore, the provisions of service tax, as were in force prior to 01.04.2016, would be applicable. Grant of natural resources was not excluded from the scope of negative list prior to 01.04.2016 and so no tax implication can be fastened on the appellant for such period." In the present case I am concerned with the period after 01.04.2016 and in view of the observations made in above decision I find that issue of leviability of service tax in respect of royalty paid against mining leases has been held to liable to service tax, on reverse charge basis. 4.6 Further I also do not find that the appellant can claim the benefit of the threshold exemption under Notification No 33/2012-ST dated 20.06.2012 in case where he is required to pay service tax on reverse charge basis. On reverse charge basis the tax is levied and collected on the element of expense towards a specified activity which is not the part of turnover of the appellant. When tax is levied upon the expenditure than appellant being not the service provider could not be allowed the benefit of this notification. The text of the notification is reproduced b....
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....ties are undertaken as a statutory or mandatory requirement under the law and irrespective of whether the amount charged for such service is laid down in a statute or not. As long as the payment is made (or fee charged) for getting a service in return(i.e., as a quid pro quo for the service received), it has to be regarded as a consideration for that service and taxable irrespective of by what name such payment is called. It is also clarified that Service Taxis leviable on any payment, in lieu of any permission or license granted by the Government or a local authority. 2. However, services provided by the Government or a local authority by way of: (i) registration required under the law; (ii) testing, calibration, safety check or certification relating to protection or safety of workers, consumers or public at large, required under the law, have been exempted vide Notification No. 25/2012 -ST dated20.6.2012 as amended by Notification No.22/2016 -ST dated13.4.2016[Entry 58 refers].3.Further, services provided by Government or a local authority where the gross amount charged for such service does not exceed Rs 5000/-have been exempted vide Notification No. 25/....