2019 (4) TMI 731 - AT - Service Tax

Classification of services - business auxiliary services or not - demanded duty under Section 73A of FA - Held that - The Learned Commissioner has not gone into all aspects of the submissions made by he Appellants. He has not given any finding as to why he has treated the services as BAS where as Show Cause Notice was silent on the same. He has simply concluded that the Appellants did not dispute the categorization or liability - matter requires consideration. Demand of duty of ₹ 3,76,38,173 - Appellants have declared gross amount of ₹ 77,12,19,813 whereas the Show Cause Notice alleges receipt of ₹ 95,42,52,185 - Held that - Commissioner has not given any findings on various submissions of the Appellants. Therefore the issue needs to go back the adjudicating authority to take into account the submissions made by the Appellants and evidence provided by them before computing the actual tax liability of the Appellants. Valuation - fuel supplied by the customers - inclusion of different reimbursements received by customers - Section 67 of the Finance Act, 1994 - Held that - The Learned Commissioner has not examined the various services provided by the Appellants before arriving at the tax liability of the Appellants - there is force in the arguments of the Appellants that the tax liability would be limited the consideration received by the Appellants for the services rendered by them not more and not less - These aspects need to be examined in the light of Hon ble Supreme Court decisions in Bhayana Builders 2018 (2) TMI 1325 - SUPREME COURT OF INDIA and Intercontinental Constructions and Technocrats 2018 (3) TMI 357 - SUPREME COURT OF INDIA . Appeal allowed by way of remand.

Summary

Issues involved:
1. Service tax collection and alleged non-payment
2. Gross amount charged and alleged short payment
3. Service tax due on additional consideration for fuel
4. Service tax due on value received for expense reimbursement
5. Appropriation of payments voluntarily made

Detailed Analysis:
1. The case involved the Appellants, engaged in mining and related services, facing allegations of not paying service tax collected during April 2005 to March 2007. The Directorate General of Central Excise Intelligence (DGCEI) issued a Show Cause Notice claiming non-payment of ?1,74,38,562. The Appellants argued that the amount was paid and beyond the limitation period. The Commissioner categorized services under "business auxiliary services" and demanded duty under Section 73A, which the Appellants disputed, stating no excess tax was collected.

2. Another issue was the alleged short payment of ?3,76,38,173 from June 2007 to March 2012. The Appellants declared a gross amount of ?77,12,19,813, while the Notice alleged ?95,42,52,185 received. The Commissioner found discrepancies and lack of evidence supporting the Appellants' claims. The Appellants argued errors in classification, incorrect value assessment, and non-granting of tax credits, leading to no tax liability if rectified. The case was remanded for a detailed assessment.

3. Regarding service tax due on additional consideration for fuel and expense reimbursements, the Appellants contended that the consideration received should determine tax liability. They argued that certain charges were not taxable as they were not benefits to the Appellants. The Commissioner's decision was criticized for not thoroughly examining the services provided, and the case was remanded for a fresh decision based on the Appellants' submissions and relevant legal precedents.

4. The judgment set aside the impugned order and directed the adjudicating authority to reevaluate the issues in light of the discussions and submissions made by the Appellants. All issues were to be reconsidered, keeping them open for further examination, emphasizing a detailed review of the Appellants' contentions and evidence provided.