2014 (7) TMI 823 - AT - Service Tax

Demand of service tax - Wrong mention of taxable services - Reflection of excess tax liability - Commissioner remanded matter back - Held that - orders of the Assistant Commissioner in implementing the remand order and dropping the demand and refunding the pre-deposit would show that there is either lack of coordination between the offices of the Department or the Assistant Commissioner has been negligent. When an appeal has been filed against the remand order, the proper course for the Assistant Commissioner was to keep the matter pending till the appeal filed by the Revenue was decided. Even if the matter is remanded to the Commissioner (Appeals) now, if no appeal has been filed by the Revenue against the Assistant Commissioner s order, the order of the Tribunal cannot be implemented. In any case, no harm has been caused since if the Revenue was aggrieved on merits of the Department, appeal would have been and may have been already filed against the Assistant Commissioner s order which would in due course get decided finally in its turn. Therefore any decision taken in this remand order is not going to affect the Revenue adversely. In this case also what was required to be done by the original adjudicating authority was to verify and quantify the value of taxable services and service tax payable after going through the certificate issued by chartered accountant. Therefore in this case also it can be said that the remand is for the purpose of quantification. Decided against Revenue.

Issues:
1. Short-payment of service tax and penalties under the Finance Act, 1994.
2. Appeal before the Commissioner (Appeals) based on wrongly mentioned taxable services.
3. Commissioner (Appeals) remanded the matter based on CA certificate.
4. Power of remand under section 35A of the Central Excise Act, 1944.
5. Implementation of remand order by the lower authority.
6. Challenge by Revenue against the orders of the Assistant Commissioner.
7. Lack of coordination or negligence by the Assistant Commissioner.
8. Impact of remand order on the Revenue.
9. Comparison with the decision in Mavenir Systems Pvt. Ltd. case.
10. Upholding the impugned order and rejecting the appeal filed by the Revenue.

Analysis:
1. The judgment dealt with the issue of short-payment of service tax and penalties under the Finance Act, 1994. The Commissioner (Appeals) considered the grounds of appeal and submissions, noting the appellant's claim of wrongly mentioned taxable services resulting in excess tax liability. The Commissioner (Appeals) found merit in the appellant's submission and remanded the matter for further consideration based on a CA certificate.

2. The learned Authorised Representative argued that post-amendment of section 35A of the Central Excise Act, 1944, the Commissioner (Appeals) lacked the power to remand the matter. However, the learned counsel for the respondents contended that the remand order had been implemented by the lower authority, who accepted the CA's certificate and dropped further proceedings, citing a Tribunal decision for support.

3. The Tribunal analyzed the submissions and observed a lack of clarity regarding any challenge by the Revenue against the Assistant Commissioner's orders. The Tribunal highlighted the importance of coordination within the Department and the potential negligence of the Assistant Commissioner in implementing the remand order without considering any pending appeals by the Revenue.

4. The Tribunal emphasized that the appeal filed by the Revenue could have rendered the Assistant Commissioner's actions infructuous, but ultimately concluded that no harm had been caused. The Tribunal referenced a previous case to support the view that the remand in this case was for the purpose of quantification, similar to the situation in the cited case, leading to the rejection of the Revenue's appeal.

5. In conclusion, the Tribunal upheld the impugned order, stating that the decision to remand the matter for quantification based on the CA certificate was justified. The appeal filed by the Revenue was rejected based on the circumstances and legal principles discussed in the judgment.

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