2009 (6) TMI 58 - AT - Service Tax

Provisional assessment telephone services ST3A and rule 6 - For the month of March, 2005, they were advised by the Department to make the excess deposits as part of revenue drive which was reflected in the statement for the month of April, 2005. The assessment in their case was provisional. Though they were required to pay service tax relating to any month either in the same month (i.e. for March) or by 5th of the next month, they were filing the return half-yearly and they have adjusted excess payment made in some months against short payments in other months. In fact, they have, in net, paid more for the half-year ending 30.9.05. Held that - The rules are not tyrants but aid to grant substantial relief required by them. What that is not required to be realized cannot be done benefit of adjustment under rule 6(4A) allowed.

Summary

The Appellate Tribunal CESTAT, New Delhi, consisting of Mr. D.N. Panda and Mr. Rakesh Kumar, heard the case presented by Shri G.C. Babbar, Advocate, for the Appellant, and Shri Vijay Kumar, SDR, for the Respondent. The appellant, a public sector undertaking providing telephone services, faced difficulties due to the nature of their service and the rules under which they were registered. The appellant had been allowed to operate under the Provisional Assessment Scheme, and a stay application was granted due to the provisional nature of the assessment. The appellant was permitted to adjust excess payments made in some months against short payments in others. The Tribunal observed that the appellant had paid in excess of what was due from them during the period in question. The Tribunal directed the adjudicating authority to finalize the provisional assessment, granting a fair opportunity of hearing to the appellant, and to pass an appropriate order in accordance with the law. The appeal was allowed with a remand for further proceedings. The ruling highlights the need for a rational decision-making process and fair application of the law, especially in cases involving public sector entities.