2019 (1) TMI 1384 - AT - Service Tax

Suo-moto Adjustment of excess service tax paid - appellant had adjusted an amount of ₹ 5,67,000/- and ₹ 15,00,000/- in the months of December, 2013 and March, 2014. The adjustment was on account of excess service tax paid in the months of March and April 2011 - Rule 6A of the Service Tax Rules, 1994 - Held that - The issue arising out of the present appeal is no more res integra in view of the Co-ordinate Bench of this Tribunal in the case of Schwing Stetter (India) Pvt. Ltd. 2016 (6) TMI 239 - CESTAT CHENNAI , where it was held that Section 13 of the General Clauses Act, 1897 provides that singular include the plural. Accordingly, month includes months. Further the various case laws relied on by the appellants are squarely applicable to the facts of the present case. The excess amount paid in the month of May, 2011 adjusted by the appellants in the subsequent months tax liability is absolutely in order. The impugned order passed by the learned Commissioner (Appeals) in upholding the adjudged demand against the appellant cannot be sustained for judicial scrutiny - appeal allowed - decided in favor of appellant.

Summary

Issues:
Interpretation of Rule 6A of the Service Tax Rules, 1994 regarding adjustment of excess service tax paid in subsequent months.

Analysis:
The appellant adjusted excess service tax paid in December 2013 and March 2014, based on an acknowledgment by the department of the excess payment during March and April 2011. The department contended that the adjustment should have been made in the subsequent month as per Rule 6A of the Service Tax Rules, 1994. This led to show cause proceedings and an adjudication order confirming a disputed amount of ?20,67,000 along with penalties. The Commissioner (Appeals) upheld this decision. The appellant argued that the term "month" should be interpreted as "months" under the General Clauses Act, 1897, justifying the adjustment made in December 2014 for the excess service tax paid in March and April 2011. The appellant cited a similar case decided by the Tribunal in Schwing Stetter (India) Pvt. Ltd. v. Commissioner of Central Excise, Chennai.

The Co-ordinate bench decision in Schwing Stetter (India) Pvt. Ltd. case interpreted the General Clauses Act, 1897, to include the plural form when singular is used, thus allowing adjustment of excess amount paid in one month to subsequent months. The tribunal found that the issue in the present appeal aligns with the precedent set in the Schwing Stetter case, indicating that the impugned order upholding the demand against the appellant cannot be supported. Consequently, the tribunal concluded that the impugned order was devoid of merit and allowed the appeal in favor of the appellant.

In conclusion, the tribunal's decision was based on the interpretation of the General Clauses Act, 1897, and the precedent set by a previous case, allowing for the adjustment of excess service tax paid in one month to subsequent months. The tribunal found the impugned order upholding the demand against the appellant to be unsustainable, leading to the appeal being allowed in favor of the appellant.