2023 (5) TMI 765 - AT - Service Tax

Proper discharge of service tax liability through book adjustment for the period April 2015 to June 2017 or not - HELD THAT - The learned Commissioner (Appeals) vide Order-in-Appeal dated 16/1/2018, in appellants own case have been pleased to allow the appeal under similar facts and circumstances observing that appellants have credited the Govt. Account on account of service tax by way of book adjustment, irrespective of the fact that the same has been deposited by them by not following the procedures, verbatim as provided under the provisions of the Finance Act, 1994. The appellants being a Govt. department cannot be attributed with any malafide intention to evade payment of Service tax. In view of the facts and circumstances and the issue already having been decided in favour of the appellant, which order have attained finality, tthis appeal is allowed - impugned order set aside.

Summary

Issues involved:
The issue involved in this appeal is whether the appellant, a Post Office (Department of Government of India under Ministry of Post & Telegraph), rightly discharged the service tax liability through book adjustment for the period April 2015 to June 2017.

Details of the Judgment:

Issue 1: Service tax liability through book adjustment
The appellant, a Post Master in district Churu, was found to have failed to pay service tax amounting to Rs. 14,84,543/- including cess for the period April 2015 to June 2017. A show cause notice was issued demanding the outstanding service tax and penalty under Section 76 of the Finance Act. The appellant had paid some portion of the service tax through book adjustment. The original adjudication order demanded the outstanding amount along with interest and imposed a penalty under Section 76.

Issue 2: Appeal before Commissioner (Appeals)
The appellant, aggrieved by the adjudication order, preferred an appeal before the Commissioner (Appeals). However, the appeal was dismissed due to a delay of about 141 days in filing, as the Commissioner (Appeals) did not have the power to condone delays of more than 30 days. Subsequently, the appellant approached the Tribunal challenging this dismissal.

Issue 3: Arguments and Decision
The appellant's representative argued that the appellant, being a government department, followed official norms and practices by paying the service tax through book adjustment. It was contended that similar show cause notices were issued in the past, and in a previous case, the appeal was allowed based on the legality of the book adjustment method. The Tribunal, after considering the arguments from both sides, allowed the restoration of the appeal in the interest of justice. Given the previous decision in favor of the appellant on a similar issue, the Tribunal set aside the impugned order, granting consequential benefits to the appellant in accordance with the law.

Conclusion
The Tribunal allowed the appeal and set aside the impugned order, providing relief to the appellant in the matter of service tax liability through book adjustment for the period in question. Both the appeal and miscellaneous application were allowed, with the order being dictated in the open court.