2018 (3) TMI 1060 - AT - Service Tax

Rejection of VCES Scheme - learned Commissioner (Appeals) held that the letter dated 8th February 2013 by the Range Superintendent is not an enquiry or an investigation for the purpose of Section 106(2) of the Voluntary Compliance Encouragement Scheme 2013, and thus the respondent is eligible for VCE Scheme, 2013 - invocation of proviso to Section 106(2) (iii) of VCES Act, 2013 - whether the issuance of letter dated 08/02/2013 by the Range Superintendent seeking some information will construe a part of the investigation which bar the respondent from opting from VCES scheme? Held that - if the investigation under Section 14 of Central Excise Act, 1944 and 72 of Finance Act, 1994and Rule 5A of Service Tax Rules, 1994 is conducted then only the case falls under the category whether of enquiry or investigation as envisaged under Section 106(2)(a)(iii) of Finance Act, 2013 - In the present case the letter issued by the Range Superintendent seeking information does not fall in any of the provisions of Section 14 of Central Excise Act, 1944 and 72 of the Finance Act, 1994 and/or Rule 5A of Service Tax Rules, 1994 - the Commissioner (Appeals) has rightly observed that the letter dated 08/02/2013 issued by the Range Superintendent cannot be construed as enquiry or investigation which debar the respondents from VCES scheme. Appeal dismissed - decided against Revenue.

Summary

Issues: Interpretation of whether a letter from the Range Superintendent constitutes part of an investigation under the Voluntary Compliance Encouragement Scheme 2013.

Analysis:
The appeal challenges the order-in-appeal that deemed a letter from the Range Superintendent as not constituting an investigation under Section 106(2) of the VCES 2013, making the respondent eligible for the scheme. The Revenue contends that the specific nature of the letter, seeking detailed information, indicates an investigation initiated before the scheme's commencement. The crux is whether this letter falls under the exclusion category of investigations under the VCES. The respondent argues that the letter was general, lacking intelligence or summons, and not part of any investigation under Section 14. The Commissioner (Appeals) supported this view, emphasizing that the letter did not align with the provisions of Section 14 of the Central Excise Act or the Finance Act, thus not barring the respondent from the VCES.

The Tribunal analyzed the circular clarifying the scope of investigations under the VCES, highlighting that only investigations under specific statutory provisions trigger the exclusion under Section 106(2)(a)(iii) of the Finance Act 2013. The circular emphasized that communications seeking general information without requisitioning documents do not fall under this exclusion. The Tribunal concurred with the Commissioner (Appeals) that the letter in question did not align with the investigative criteria specified in the circular, hence not disqualifying the respondent from the VCES. The Tribunal found no fault in the Commissioner's decision, upholding the order and dismissing the Revenue's appeal. The judgment emphasizes the importance of aligning investigative actions with statutory provisions to determine eligibility under the VCES, ensuring clarity in distinguishing routine inquiries from formal investigations.