2015 (9) TMI 418 - HC - Service Tax

Validity of Show Cause notice - proper officer - argument was raised before the tribunal first time - it was contended that notice has been issued by the Superintendent of the Central Excise. He lacks jurisdiction and, therefore, the order passed by the Adjudicating Authority was void ab initio - it was contended that show cause notice could have been issued only by the Commissioner of Central Excise or any delegate of the Commissioner duly and properly delegated the powers to adjudicate in terms of the Finance Act, 1994 and the Central Excise Act, 1944. Held that - whether the entire proceedings from the inception were under the authority of the Superintendent and he concluded the adjudication, was an argument raised for the first time before the Tribunal that the Tribunal found it fit to reject it by assigning reasons inter alia of acquiescence. - We do not find that the Tribunal s order in relation to this aspect raises any substantial question of law. - appeal dismissed - Decided against the assessee.

Summary

Issues:
1. Jurisdiction of the Adjudicating Authority
2. Obligation of remitting service tax collected from clients
3. Reimbursable expenses and service tax liability

Jurisdiction of the Adjudicating Authority:
The appellant contended that the show cause notice should have been issued only by the Commissioner of Central Excise or a duly delegated delegate, not by the Superintendent. The appellant argued that this lack of jurisdiction rendered the Adjudicating Authority's order void ab initio. However, the Tribunal found that the appellant did not question the jurisdiction earlier and only raised it belatedly without providing supporting evidence. The Tribunal rejected this argument, stating that the order was duly signed by the Adjudicating Authority, and the competence was not questioned. The Tribunal concluded that the proceedings were conducted by the competent authority, and the argument of Superintendent's authority was rightly rejected due to acquiescence. The High Court upheld the Tribunal's decision, stating that no substantial question of law was raised on this aspect.

Obligation of remitting service tax collected from clients:
The appellant claimed to have discharged the obligation of remitting service tax collected from clients, arguing that certain charges were reimbursable and thus not subject to service tax. Despite presenting bills and documents to support this claim, the Tribunal found that the appellant failed to prove the nature of the expenses as reimbursable. The Tribunal rejected the argument that the higher collection amounts were for statutory levies paid on behalf of clients, as there was no evidence of reimbursable services rendered. The Tribunal concluded that the service tax component was not fully remitted, leading to the dismissal of the appeal based on the computation of the department.

Reimbursable expenses and service tax liability:
The Tribunal found that the appellant did not provide sufficient evidence to support the claim that certain expenses were reimbursable and not subject to service tax. The appellant's argument that the higher collection amounts were due to statutory levies paid on behalf of clients was rejected. The Tribunal determined that the service tax collected was not fully remitted, leading to the dismissal of the appeal. The High Court upheld this decision, stating that the findings were based on the evidence presented and not legally flawed. Consequently, the appeal was dismissed with no costs awarded.