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TMI Blog2015 (10) TMI 1857X X X X Extracts X X X X X X X X Extracts X X X X ..... r as to costs - Appeal of revenue rejected and that of assessee is accepted – Decided in favour of assessee. - Appeal No. ST/381/11 And Appeal No. ST/66/12 - Final Order Nos. A/3392-3394/2015-WZB/STB - Dated:- 30-9-2015 - Mr. M.V. Ravindran, Member (Judicial) And Mr. C.J. Mathew, Member (Technical) For the Petitioner : Shri V.B. Gaikwad, Advocate For the Respondent : Shri S.R. Nair, E.O. (AR) ORDER Per: M.V. Ravindran These 3 appeals are directed against Orders-in-Appeal No. PII/AV/03/2011 dated 25.02.2011 and PII/RKS/135/2011 dated 24.11.2011. Revenue as well as the assessee are aggrieved by the impugned orders hence both challenge the findings of the first appellate authority, which are against them. 2. The relevant facts that arise for consideration are the appellant assessee herein is a Co-operative Society formed in Chiplun, Ratnagiri. The said Society is of members and is engaged in accepting deposits, lending and operation of the accounts. After an investigation, it was noticed that the appellant had not discharged the service tax liability on the various fees collected by them from the members in respect of the functioning of the Society. Acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... truck down by holding that the provisions of Section 65 (25a) and also 65 (105) (zzze) are unconstitutional to the extent it pertains to levy of services provided by Society to its members. He would also submit that same view was expressed by the Tribunal in the case of Punjab State Federation of Co-operative Sugar Mills Ltd 2014 (36) STR 110. 5. Learned departmental representative would draw our attention to the findings recorded by the lower authorities. It is his submission that the appellant had registered under the provisions of Finance Act, 1994, and did not discharge the service tax liability on the various charges collected by them from their members. He would reiterate the findings of the lower authorities. As regards the appeal filed by the revenue, it is his submission that the first appellate authority has erred in reducing the tax liability and also setting aside the penalties imposed under Section 76 of the Finance Act, 1994. 6. We have considered the submissions made by both sides and perused the records. 6.1 The issue that needs deliberation in the appeals filed by the assessee is whether differential service tax liability arises on them in respect of the v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent treatment to its members through the medium of cooperative society. The case of the petitioners is that such society was created solely with a purpose of providing effluent treatment facility commonly to its members who were the industrial establishments located at Vatva. Any service provided by them, therefore, could not be made taxable since it was merely a service provided by the members to themselves. There was no element of any commercial service provided by the service provider to its consumers. Inter alia on such basis the petitioners challenged the constitutionality of Section 65(25a), which authorizes collection of such Service Tax from the agencies such as the petitioner No.1. Pending this petition, the adjudicating authority confirmed the duty demand with penalty and interest as mentioned above. The petitioners have, therefore, separately challenged such order-in-original. 3. Learned counsel, Shri Shelat for the petitioners pointed out that initially the show cause notice was issued basing the recoveries on Section 65(19) of the Finance Act, 1994 however, realizing that such demand would not be maintainable under said provision, separate show cause notice was is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 65(25a), insofar as it pertains to the service provided by a society to its members, came to be declared as unconstitutional by a Division Bench of this Court in the case of Sports Club of Gujarat Ltd. v. Union of India and Others reported in (2013) 64 VST 191 = 2013 (31) S.T.R. 645 (Guj.) The Court held as under : The learned advocate Mr. Ravani appearing for the Authorities i.e. Union of India, Commissioner of Central Excise, and Deputy Commissioner/Assistant Commissioner, Service Tax Cell, vehemently opposed the petitions and submitted that the Department has not accepted the aforesaid judgment. Learned advocate submitted that the Department has filed SLP before the Honble Apex Court and the judgment is under challenge. Merely because the judgment is not accepted by the Department, its persuasive value is not lost and it can always be considered by this Court for its persuasive value, more particularly when the said judgment has relied upon a decision of the Full Bench of Patna High Court in the matter of Commissioner of Income-Tax v. Ranchi Club Ltd., 1992(I) PIJR 252 (Pat) (FB), which is referred to by the Division Bench. The learned advocate for the Departmen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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