2021 (7) TMI 1407 - AT - Service Tax

Deposit of Service Tax or not - learned Commissioner in the impugned order has observed that though the appellant has submitted that the amount has been deposited through book adjustment but the actual payment has not been established - HELD THAT - The Railway Board, Ministry of Railways, vide letter no. 2017/AC-II/1/21 dated 16.11.2020 has confirmed the deposit of the service tax. It has been initer-alia stated that The amount of service tax collected by Railways was being credited to Civil Head of Account, Major Head 0044 Service Tax every month through monthly Account Current sent to CGA, Ministry of Finance as per existant guidelines from the Ministry of Finance. The details of Service Tax booked under Major Head 0044 by Ministry of Railways during the financial year 2012-13, 2013-14 and 2014-15. Thus, service tax stands deposited with the Government Treasury through account adjustment, instead of payment by challans, as per the guidelines issued by the Finance Ministry, and hence, this is not the case of non-payment of service tax - The said view has consistently been taken by the Tribunal in M/S. POST MASTER VERSUS COMMISSIONER OF CENTRAL GOODS SERVICE TAX AND CENTRAL EXCISE, JODHPUR 2020 (4) TMI 345 - CESTAT NEW DELHI , SENIOR POST MASTER VERSUS CCE AND ST, JAIPUR-I 2018 (3) TMI 1673 - CESTAT NEW DELHI and THE SUPERINTENDENT OF POST OFFICE VERSUS COMMISSIONER OF CENTRAL EXCISE, GUWAHATI 2017 (3) TMI 789 - CESTAT KOLKATA . There is a need for examination of quantification of tax amount involved during the period in dispute so as to ensure whether the same corresponds to the amount deposited by way of book adjustment for which the matter is remanded back for limited purpose. In the said remand proceedings, the authorities shall verify with regard to the quantification and supporting documents. Appeal allowed by way of remand.

Summary

Issues:
Appeal against Order-in-Original confirming service tax demand of Rs.612.38 crores approx.; Non-deposit of service tax collected with the Government Treasury; Applicability of guidelines for depositing service tax through account adjustment; Need for examination of tax amount involved during the disputed period.

Analysis:
The appeal was filed by East Central Railways against the Order-in-Original confirming a service tax demand of approximately Rs.612.38 crores. The proceedings were initiated based on the allegation that the service tax collected was not deposited with the Government Treasury as required by the Finance Act, 1994. The Commissioner observed that although the appellant claimed the amount was deposited through book adjustment, the actual payment was not proven.

Upon reviewing the case and documents, the Tribunal noted that the Railway Board confirmed the deposit of service tax through a letter dated 16.11.2020. The amount collected was credited to the Civil Head of Account as per existing guidelines from the Ministry of Finance. It was clarified that the service tax was booked under the Major Head 0044 for specific financial years.

The Tribunal found that the service tax had indeed been deposited with the Government Treasury through account adjustment, in accordance with the guidelines issued by the Finance Ministry. This aligns with the Tribunal's consistent stance in previous cases such as Post Master vs. CCE, Jodhpur and others, where similar situations were dealt with.

Consequently, the impugned order confirming the service tax demand was set aside as it could not be sustained. However, the Tribunal emphasized the necessity to examine the quantification of the tax amount involved during the disputed period to ensure it corresponds to the amount deposited through book adjustment. The matter was remanded back to the authorities for this specific purpose, directing them to verify the quantification and supporting documents while providing the appellant with a fair opportunity of personal hearing.

In conclusion, the appeal was allowed by way of remand to the learned Adjudicating Authority for further examination and verification of the tax amount involved, emphasizing cooperation from the appellant and adherence to principles of natural justice to avoid unnecessary delays in the proceedings.