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2018 (3) TMI 1747 - Commission - Service TaxCondonation of delay of 4 days in payment of the dues - whether the Applicant had complied with the condition of making the payment of dues ordered in the Final Order No. 5/2017-S.T., dated 23-2-2017 within 30 days of the receipt of order? - Held that - Considering the fact that the Applicant had discharged the balance Service Tax of ₹ 37,08,819/- and penalty of ₹ 5,00,000/-, which were specified and quantified, on the 14th of March, 2017, and had also sworn by an Affidavit that the computation of interest liability was finally confirmed by the Investigating Agency only on 3-4-2017, which was not refuted by the department, observes that the submissions made by the Applicant has force and period between 14-3-2017 to 3-4-2017 needed to be excluded for the purpose of computing the time limit of 30 days given for payment of the dues. As the interest liability could not be specified in the subject Final Order, inasmuch as a portion of the additional Service Tax liability settled, remained unpaid on the date of order, the Applicant was directed to work out the interest liability to the satisfaction of the jurisdictional Commissioner and pay the same within 30 days of receipt of the order - The Applicant could not be expected to discharge the interest liability, unless the same is confirmed by the department, as per the orders of the Bench. The Bench feels that the Applicant has a strong case in the matter and accordingly holds, in the facts and circumstances of the case, that the 30 days period insofar as the payment of interest is concerned, is to be taken from the date of communication confirming the quantification of interest by the Departmental officer. Upon reconsideration of the Miscellaneous Application dated 11-10-2017 filed by the Applicant, the same is allowed.
Issues Involved:
1. Settlement of Service Tax liability. 2. Condonation of delay in payment of interest. 3. Compliance with the Settlement Commission's order. 4. Interpretation of the receipt date of the order. 5. Confirmation of interest liability by the jurisdictional Commissioner. Issue-wise Detailed Analysis: 1. Settlement of Service Tax Liability: The Applicant, M/s. Flight Raja Travels Pvt. Ltd., initially admitted a Service Tax liability of ?1,04,92,488/- and interest of ?48,23,420/- against the demanded amount of ?2,20,33,977/-. The Settlement Commission settled the additional Service Tax liability at ?1,42,01,307/-, directing the Applicant to pay the balance Service Tax amount of ?37,08,819/-, and imposed a penalty of ?5,00,000/-. The Applicant was required to work out the interest liability to the satisfaction of the jurisdictional Commissioner and pay the balance within 30 days. 2. Condonation of Delay in Payment of Interest: The Applicant paid the balance Service Tax and penalty on 14-3-2017 and the interest on 4-4-2017. The Registry observed a delay of 4 days in the payment of interest and advised the jurisdictional Commissioner to take necessary action. The Applicant filed a miscellaneous application for condonation of delay, arguing that the Finance department received the order on 6-3-2017 and paid the interest within 30 days of this date. 3. Compliance with the Settlement Commission's Order: The Applicant contended that they complied with the Settlement Commission's order by paying the tax liability and penalty on 14-3-2017 and the interest on 4-4-2017, after obtaining confirmation from the DGCEI. They argued that the period between 14-3-2017 and 3-4-2017 should not be counted for computing the 30 days period due to ongoing communications with the DGCEI for interest computation. 4. Interpretation of the Receipt Date of the Order: The department argued that the order was received by the Applicant on 1-3-2017, as per the Speed Post Acknowledgement, and thus the interest payment was delayed by 4 days. The Applicant claimed the order was received by the Finance department on 6-3-2017, and the 30 days period should be counted from this date. The Bench concluded that the date of receipt should be treated as 1-3-2017, as per the Postal Acknowledgement. 5. Confirmation of Interest Liability by the Jurisdictional Commissioner: The Applicant submitted that they were in communication with the DGCEI for interest computation, which was confirmed only on 3-4-2017. They argued that they could not discharge the interest liability without this confirmation. The Bench considered the affidavit and communications submitted by the Applicant and concluded that the period between 14-3-2017 and 3-4-2017 should be excluded from the 30 days period for compliance. The Bench held that the Applicant had complied with the Final Order by paying the balance interest on 4-4-2017. Decision and Findings: The Bench held that the Applicant had complied with the Final Order No. 5/2017 by paying the balance interest on 4-4-2017, considering the confirmation of interest liability by the DGCEI on 3-4-2017. The Bench allowed the miscellaneous application for condonation of delay filed by the Applicant. Order: Upon reconsideration of the Miscellaneous Application dated 11-10-2017 filed by the Applicant, the same is allowed.
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