2015 (4) TMI 530 - AT - Service Tax

Demand for interest under Section 75 - Held that - Adjudicating authority have gone into the details and have not admitted the claim of cum duty only on the basis of Chartered Accountant's Certificate but have also got the claim verified by the Jurisdictional Superintendent and thereafter have accepted the same. Further, no error has been pointed out in the reports of the Superintendent or any other contrary evidence having been brought on record by the Revenue that the claim of cum duty is wrong or contrary to the facts on records. Following decision of Star India Pvt. Ltd. Versus CCE, Mumbai & Goa 2005 (3) TMI 10 - Supreme Court - Decided against Revenue.

Summary

Issues:
1. Error in calculating arrears of demand for interest under Section 75 of the Finance Act.
2. Acceptance of evidence produced by the assessee in the form of Chartered Accountant Certificate.

Analysis:

Issue 1: Error in calculating arrears of demand for interest under Section 75 of the Finance Act
The Revenue appealed against the Order-in-Original passed by the Commissioner of Service Tax, Mumbai, citing errors in calculating arrears of demand for interest under Section 75 of the Finance Act. The grounds of appeal included discrepancies in the calculation of interest on arrears of service tax paid. The appellant contended that the adjudicating authority erred in accepting the evidence presented by the assessee, specifically the Chartered Accountant Certificate, which indicated that the gross amount collected was cum duty. The Revenue argued that the documents should not have been accepted without proper verification of the taxable value inclusive of Service Tax.

Issue 2: Acceptance of evidence produced by the assessee in the form of Chartered Accountant Certificate
The respondent/assessee, in response to the discrepancy raised by the Revenue, explained that the broadcasting service they provided was brought under the tax net with the Finance Bill 2001. They clarified that their activities in India involved acting as an agent for their parent company in Singapore, which provided broadcasting services. The respondent emphasized that they did not accept liability initially, as the matter was under litigation. With the introduction of reverse charge under Section 66A of the Act and subsequent amendments, the respondent paid the taxes within the stipulated period. The respondent highlighted a Supreme Court judgment, which supported their position regarding the retrospective effect of the amendments. The adjudicating authority thoroughly examined the Chartered Accountant Certificate and verified the claim with the Jurisdictional Superintendent before accepting it. The authority found no errors in the verification process or contradictory evidence presented by the Revenue.

In conclusion, the Appellate Tribunal dismissed the Revenue's appeal, citing the Apex Court's ruling and the clear findings in the adjudication order regarding the cum-duty claim. The Tribunal found that the issues raised were conclusively settled by the existing legal framework and the evidence provided by the respondent was duly verified and accepted.