9911796707
TMI Blog2010 (6) TMI 167X X X X Extracts X X X X X X X X Extracts X X X X ..... provided in the nature of business auxiliary. Thus there is not total waiver of penalty. - ST/776/2009 - ST/109/2010 (PB) - Dated:- 25-6-2010 - Dr. Chittaranjan Satapathy, Member (T) and Shri D.N. Panda, Member (J) Shri V. Laxmikumaran, Advocate, for the Appellant. Shri S.K. Panda, Joint CDR, for the Respondent. [Order per : D.N. Panda, Member (J)]. - The appellant came up in appeal against Order-in-Original dated 27-7-2009 passed by learned Commissioner relating to the period July 2003 to January 2007, giving rise to following consequences : (a) Service tax amounting to Rs. 128,92,43,724/- (Rupees one hundred twenty eight crore ninety two lacs forty three thousands and seven hundred twenty four) was demanded from M/s. Jetlite (India) Limited (formerly Sahara Airlines Limited) under Section 73(1) of Finance Act, 1994. (b) Interest under the provision of Section 75 of Finance Act, 1994 from M/s. Jetlite (India) on demand was ordered for recovery. (c) Penalty of Rs. 128,92,43,724/- (Rupees one hundred twenty eight crore ninety two lacs forty three thousands and seven hundred twenty four) was levied under Section 78 of Finance Act, 1994 upon the appellant for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch customers through printing in air tickets of M/s. SAL. Necessary consideration per passenger ticket was paid to the appellant Airlines for such purpose by SICCL. 6. Revenue recorded statement from many persons explaining nature of activity carried out by the appellant and publicity done in respect of construction of residential and commercial complexes/townships projects undertaken by SICCL under the brand name "Sahara". SICCL was Flagship Company of Sahara Group. 7. An agreement dated 30-3-1995 was entered into between M/s. SAL M/s. SICCL. The said agreement revealed that M/s. SAL was under an obligation to promote the real estate and housing projects and area of operation of M/s. SICCL for which a consideration per passenger ticket was payable to M/s. SAL. Shri R.S. Dubey, Executive Director on his examination from time to time confirmed that this was understanding between the parties in terms of different letters. By his statement recorded on 11-2-2008 and 21-5-2008 he stated that M/s. SICCL was developing residential and commercial complexes/townships under the brand name "SAHARA" and extensive publicity was made by M/s. SAL to promote such housing project of M/s. SICC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1-7-2003 under Finance Act, 1994. Such decision of learned Adjudicating Authority comes out from para 31 of OIO in terms of the agreement between the parties. 10. So far as second issue of limitation is concerned, learned authority below held that the service provided in terms of agreement dated 30-3-1995 was of the category of "Business Auxiliary Service" and M/s. SICCL having been registered under the Finance Act, 1994 and filing service tax return, there was nothing left for M/s. SAL to discharge its tax liability disclosing material facts. The opinion taken from the Consultant Shri S.S. Gupta on 4-8-2003 did not leave any scope to prove the bona fide of the appellant. Therefore it was held by the learned Adjudicating Authority that the appellant without paying service tax on the "Business Auxiliary Service" provided contravened the provisions of law causing loss of revenue. Accordingly, extended period of limitation was applicable. He also discarded the plea of lack of jurisdiction in terms of para 33.1 of OIO. 11. So far as the issue of cum-tax service is concerned, the authority dealt that issue at page 41 of the OIO and he found that the appellant's claim was merited. B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pre-deposit of entire demand is called for during pendency. 15. Heard both sides and perused the record as well as relevant documents to which our attention was drawn in the course of hearing. Subsequent to hearing of stay application, the appellant filed an affidavit explaining that M/s. SICCL vide their letter dated 10-3-2000 informed the appellant that they will not supply brochures to the appellant company and that was accepted by the appellant company in terms of their letter dated 13-3-2000. During the relevant period, M/s. SICCL did not require M/s. SAL to undertake any of the activities specified in Sr. No. 3 of letter dated 30-3-1995 and M/s. SAL also did not undertake such activities for M/s. SICCL. So also, during the relevant period M/s. SICCL did not require M/s. SAL to undertake any other activity to popularize business of M/s. SICCL as mentioned in Sr. No. 4 of the letter dated 30-3-1995 and consequently M/s. SAL did not undertake any such activity. In terms of Para 5 of the affidavit it was averred that total consideration paid by M/s. SICCL to M/s. SAL in terms of Sr. No. 5 of the letter dated 30-3-1995 during the relevant period was only towards display of logo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant and as revealed by statements recorded by Revenue. For convenience of reading, the relevant part of the communication dated 30-3-1995 referred to above is extracted below : "DATED 30-3-1995 No. SIHL/MARC/DIR/95/ M/S. Sahara India Airlines Limited, Sahara India Bhawan, 1, Kapoorthala Complex, Lucknow Dear Sirs, Sub : Our Publicity through your Airlines. We refer to the discussions of the undersigned had with your Director, Shri Subrata Roy Sahara, on the above matter in several meetings. What we want your AirLines to do, is to give extensive publicity to out activities in order to promote our business and area of operations. We confirm that the following arrangements have been arrived at with you by us. (1) All your Aircrafts will have exactly the same logo and in the same colour as used by us and the same will be prominently displayed outside of both sides of each and every aircraft in the manner that the same is clearly visible to general public at least from the distance of 200 metres. (2) You will use our logo and its colour scheme on all your tickets. Boarding Passes, Baggage tags, publicity materials and advertisements in newspa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Arrangement of parties through Para 4 of the affidavit does not appear to have granted immunity from the tax liability incurred under law in respect of supporting marketing assistance primarily provided by the appellant. This is evident from para (6) of the aforesaid communication dated 30-3-1995. 19. The very intention of the parties was to achieve the object of M/s. SICCL through the passengers of M/S. SAL by an agreed practice and arrangements, introducing the conception of the housing project in the minds of the passengers through the logo on the tickets and other connected materials meant for them had bearing on the issue. Object of each other appears to have been achieved in absence of any ceased or desisted practice or discontinuance of marketing promotion activity printing the logo on passenger tickets without abandoning such modus operandi or change of motive of each other which is patent from record and conduct of the parties. No evidence was led before the authorities to prove that use of logo was not helpful to promote real estate business of M/s. SICCL when source of information was given to the passenger aiding in promoting marketing of the project. Information wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tract during the impugned period. The appellant would not have been paid consideration without taxable service provided by it. Had there been no taxable service provided by appellant to M/s. SICCL the appellant would have been unpaid. The reasoned and speaking order passed by the learned adjudicating authority calls for protection of interest of Revenue to work out an interim modality when prima facie, the service provided and received appears to be of the nature of "Business Auxiliary" in absence of any cogent evidence to the contrary. 23. The appellant, prima facie, has not brought out its case for total waiver of pre-deposit during pendency of appeal since appeal is a conditional right granted by law as held in the case of Vijay D. Mehta - 1989 (39) E.L.T. 178 (S.C.) = 1988 (4) SC 402. Balance of convenience does not tilt in favour of the appellant. There was no case made out to show that irreparable injury or undue hardship shall be caused to the appellant if no full waiver is granted. Revenue appears to be prejudiced if realization of demand is stayed following decision of Apex Court in Benara Valves case - 2008 (12) S.T.R. 104 (S.C.) = 2006 (204) E.L.T. 513 (S.C.) and M/s. ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
