2018 (11) TMI 358 - AT - Service Tax

Demand of differential duty - mis-declaration of value of taxable consideration received - Held that - Even for the sake of argument it is accepted that service tax was recovered by the appellant even in that case if the activity did not attract service tax then such collected service tax can be recovered by invoking provision under Section 73 of Finance Act, 1994 and that present show cause notice did not invoke Section 73A of Finance Act, 1994 and, therefore, the said issue should not interfere in the decision making in the present case - appeal allowed - decided in favor of appellant.

Summary

Issues:
Appeal against service tax confirmation and penalties imposed under Section 73 of Finance Act, 1994.

Analysis:
The appellant, engaged in printing, sale of computers, and forwarding advertisements to newspapers, was alleged to have mis-declared taxable consideration, leading to a demand for differential duty. The show cause notice issued in 2013 was contested, resulting in the impugned Order-in-Original dated 13.01.2015 confirming a service tax liability of ?57,03,101/- along with penalties. The appellant challenged this order before the Tribunal.

The appellant's counsel argued that the income sources certified by a Chartered Accountant did not fall under taxable services, as printing and sale of computers were not covered by service tax. Additionally, the commission received from newspapers for forwarding advertisements was not considered a commission on sale of goods, thus not falling under Business Auxiliary Service. The counsel contended that printing of flex did not meet the criteria for service tax on advertisement services. Moreover, the appellant was alleged to have collected service tax from customers, but it was argued that customers did not pay service tax as they believed the activity was not taxable.

The Tribunal noted the appellant's submissions to be valid and set aside the impugned order, allowing the appeal. It was observed that there was no invocation of Section 73A of the Finance Act, 1994 in the show cause notice, indicating that the collected service tax, even if recovered, could not be demanded without proper legal basis. The appellant was granted consequential relief in accordance with the law.

In conclusion, the Tribunal's decision favored the appellant, emphasizing that the contentions raised by the appellant's counsel were sustainable. The appeal was allowed, and the appellant was entitled to appropriate relief as per the law.