2006 (9) TMI 260 - AT - Service Tax

Summary

Issues involved:
The issues involved in the judgment are the recovery of Service Tax amount, the discretion of the Tribunal in admitting appeals below a certain value, and the comparison of provisions under the Central Excise Act, 1944 and the Finance Act, 1994.

Recovery of Service Tax Amount:
The Commissioner of Central Excise and Customs ordered the recovery of a Service Tax amount from the appellants and crediting it to the Consumer Welfare Fund u/s 11-AB in terms of Section 11B of the Central Excise Act, 1944. This decision set aside the earlier order of the Deputy Commissioner who had ordered a refund to the assessee.

Discretion of the Tribunal in Admitting Appeals:
The issue raised was whether the Tribunal should exercise discretion in admitting the appeal since the value was less than Rs. 50,000. The dispute related to the liability to pay Service Tax on services received from goods transport operators, which was shifted to the service recipients by a specific notification. The appellant argued that Section 86 of the Finance Act, 1994 allows for filing an appeal without discretion when the value is below Rs. 50,000. The Tribunal's powers under Section 35C of the Central Excise Act, 1944 were highlighted, indicating that the Tribunal's discretion under Section 35B did not apply to the Finance Act, 1994.

Comparison of Provisions under Central Excise Act and Finance Act:
A comparative study of Sections 35B and 35C of the Central Excise Act, 1944 with Sections 83 and 86 of the Finance Act, 1994 was conducted. It was noted that the Tribunal's powers under Section 86 were limited to hearing appeals and making orders under the Central Excise Act, 1944, not in respect of admission of appeal. The Tribunal's discretion under the second proviso to Section 35B(1) of the Central Excise Act, 1944 was found not to be available under the Finance Act, 1994. The judgment clarified that an appeal could lie before the Appellate Tribunal against orders passed under specific sections of the Service Tax Rules 1994, irrespective of valuation, and that there were substantial questions of law involved in the present appeal.