2023 (10) TMI 817 - AT - Service Tax

Scope of subsequent SCN - same person as Commissioner has passed these three orders and they paraphrased each other - installation and commissioning and works contract services - HELD THAT - The sole basis of conformation of demand made in these three appeals was that in the de novo proceeding the demand in its entity was conformed with interest and penalties but having regard to the fact that the said de novo adjudication order has been set aside by this Tribunal and the subsequent demands raised through Section 73(1A) as well as its conformation having based on the previous conformation orders, the same is liable to be set aside. Therefore, in order to maintain consistency and predictability of the order of this Tribunal and in obedience to judicial precedent set by it, the orders passed by the Commissionerate of CGST CX are hereby set aside. Appeal allowed.

Issues:
The judgment involves the conformation of Service Tax demand raised in three Show Cause Notices (SCN) for different financial years, along with interest and penalties under Sec 76 and 77 of the Finance Act, 1994. The main issue revolves around the segregation of value for installation and commissioning services from the value of materials supplied, leading to the dispute over the payment of Service Tax.

Facts of the Case:
The Appellant Company, engaged in manufacturing elevators and providing installation services, faced a dispute with the Respondent-Department regarding the payment of Service Tax on installation and commissioning services. The Department contended that the Appellant had not properly segregated the value of materials from the value of taxable services, leading to the demand for Service Tax on the entire turnover. The matter had a history of litigation, with previous adjudication orders being challenged and set aside by the Tribunal.

Appellant's Argument:
The Appellant argued that the demands raised in the three appeals were based on previous demands that had been set aside. Citing legal precedents and emphasizing the need for consistency in judicial decisions, the Appellant contended that the value of materials on which VAT had been paid should not be included in the Service Tax liability. The Appellant had already discharged the Service Tax liability on the appropriate components and should not be held liable for the gross amount charged.

Respondent's Argument:
The Authorised Representative for the Respondent supported the Commissioner's decision, highlighting the Appellant's inconsistent valuation methods and failure to provide proof of VAT payment on the differential amount. The Respondent argued that the Commissioner's finding, that segregation of values was not possible, was justified based on the Appellant's actions and the lack of proper substantiation.

Tribunal's Analysis:
The Tribunal scrutinized the appeal records and observed that the Commissioner's findings lacked proper substantiation and were seemingly prejudiced against the Appellant. The Tribunal noted that the earlier de novo adjudication order had been set aside, leading to the conclusion that the demands based on the previous conformation orders needed to be set aside for consistency and predictability in judicial decisions.

Judgment:
In light of the above analysis, the Tribunal allowed all three appeals and set aside the orders passed by the Commissionerate of CGST & CX. The Tribunal emphasized the need for maintaining consistency and predictability in its orders and followed the judicial precedent set by previous decisions.

Conclusion:
The Tribunal's judgment focused on the importance of consistent legal decisions and the proper segregation of values for tax liabilities. By setting aside the orders based on previous demands, the Tribunal aimed to uphold fairness and clarity in tax assessments.

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