2018 (1) TMI 427 - AT - Service Tax

Jurisdiction - power of Superintendent to finalize provisional assessment - provisional assessment finalized in November, 2006 itself - Held that - Finalization of provisional assessments is within the powers of Assistant/Deputy Commissioner in terms of Rule 6 (6) of Service Tax Rules, 1994. The endorsements of the Superintendent, though refers to an approval by the Deputy Commissioner, cannot be considered as finalization of provisional assessment - The assessment has to be done by the Assistant Commissioner in his name and signature. The same cannot be delegated to the Superintendent. Belated order of finalization - Held that - the Central Excise provisions for finalization of provisional assessment do have limit of six months for such finalization form date of furnishing the particulars by the assessee - the present order has been issued much belatedly - In any case, the duty payments as already deposited by the appellants have found to be correct. There is no grievance regarding any demand for extra payment or liability that was put on appellant on such finalization. Appeal dismissed.

Summary

Issues:
1. Finalization of provisional Service Tax assessment for the year 2005-2006.
2. Legality of the finalization process and authority involved.
3. Timeliness of the finalization process.

Analysis:

Issue 1: Finalization of provisional Service Tax assessment for the year 2005-2006
The appeal in question was against the order of the Commissioner (Appeals) regarding the finalization of the provisional Service Tax assessment for the year 2005-2006. The appellants had initially paid Service Tax on a provisional basis due to the inability to ascertain the correct taxable value promptly. The finalization process was initiated after the appellants submitted ST-3 A returns with details of earlier payments and any differential amounts. The Jurisdictional Assistant Commissioner issued an order stating that the assessment for the period had been completed, and the correct Service Tax had been deposited by the appellants. The Commissioner (Appeals) upheld this finalization in their order.

Issue 2: Legality of the finalization process and authority involved
The appellant argued that the assessment had already been finalized by the Jurisdictional Superintendent in November 2006 through endorsements on the ST-3 A returns and approved by the Deputy Commissioner. They contended that there was no need for further proceedings for finalization. However, the Tribunal noted that the Superintendent's endorsements could not be considered as the proper finalization of the assessment as per the law. Finalization of provisional assessments falls within the purview of the Assistant/Deputy Commissioner as per Rule 6 (6) of the Service Tax Rules, 1994. Delegating such authority to the Superintendent was deemed impermissible.

Issue 3: Timeliness of the finalization process
The Tribunal addressed the belated finalization of the assessment, noting that Central Excise provisions stipulate a limit of six months for such finalization from the date of furnishing particulars by the assessee. The order in question was issued much later than this prescribed period. However, since the duty payments made by the appellants were found to be correct, and no additional burden was imposed on them, the delay did not result in any grievance. The finalization process focused solely on the correct quantification of tax liability, with no other issues considered. Despite the delay, the Tribunal found no merit in the appeal and dismissed it.

In conclusion, the Tribunal upheld the finalization of the provisional Service Tax assessment for the year 2005-2006 by the Jurisdictional Assistant Commissioner, emphasizing the importance of proper authority involvement and timeliness in such processes.