2018 (8) TMI 15 - AT - Service Tax

Penalty - non-payment of Service Tax - It is the case of the Revenue that removing of Hard Shale is nothing but Site formation for coal extraction by way of earthmoving and clearance and production of carbonaceous shale by way of drilling, boring, excavation, core extraction, earthmoving upto the pit area - Held that - In the appeal before us, in Form ST-5, the period of dispute has been mentioned as 01.04.2007 to 31.08.2007 and it is also repeated in the Statement of Facts. There seems to be some discrepancies and misstatement of facts on the part of appellant revenue in drafting and filing this appeal before the Tribunal. Penalty is not imposable in this case as the dispute involves interpretation of provisions of law and in view of the various decisions of the Tribunal, Hon ble High Courts and Hon ble Supreme Court, this part of the order is sustained. Since the respondent assessee has neither filed any cross objection against the grounds of appeal nor have appeared before the tribunal, it would be appropriate to remand the matter to the adjudicating authority to consider the grounds of appeal filed by the Revenue and to pass the order in accordance with law - appeal is allowed by way of remand.

Summary

Issues:
1. Failure of the respondent assessee to appear despite notice.
2. Allegations of non-payment of service tax by the respondent assessee.
3. Discrepancies in the period of dispute mentioned in the appeal.
4. Recalculation of service tax liability by the adjudicating authority.
5. Imposition of penalty by the adjudicating authority.
6. Charge of service tax on the security deposit deducted from the bill.

Issue 1 - Failure to Appear:
The respondent assessee failed to appear despite notice, prompting the Tribunal to proceed with the hearing due to the appeal's age.

Issue 2 - Allegations of Non-Payment:
The case involved the respondent assessee providing services to another company for coal excavation, with a Show Cause Notice issued for alleged non-payment of service tax. The adjudicating authority confirmed the service tax demand, along with interest, but refrained from imposing a penalty due to the genuine legal dispute.

Issue 3 - Discrepancies in Period of Dispute:
Discrepancies arose as the period of dispute mentioned in the appeal differed from the one in the original notice, indicating misstatements by the appellant revenue.

Issue 4 - Recalculation of Service Tax Liability:
The adjudicating authority recalculated the service tax liability, reducing it based on the assessee's plea that the billed amount was inclusive of service tax.

Issue 5 - Imposition of Penalty:
The authority refrained from imposing a penalty, citing genuine doubt regarding the applicability of service tax, which was upheld by the Tribunal considering legal interpretations.

Issue 6 - Charge on Security Deposit:
A contention existed regarding the imposition of service tax on a security deposit deducted from the bill, raising concerns about the taxable amount.

In conclusion, the Tribunal allowed the appeal by remanding the matter to the adjudicating authority for further consideration in accordance with the law, emphasizing the need for a fair hearing for the respondent assessee.