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TMI Blog2018 (7) TMI 702X X X X Extracts X X X X X X X X Extracts X X X X ..... e only allegation is that the appellant ought not to have collected the service tax on sponsorship service. Generally, it is the output service provider who has to pay the service tax and in some cases like sponsorship services, the Service Tax Rules provide that the liability to pay service tax is upon the service recipient. Appellant has collected service tax wrongly from service recipient and paid to Central Government instead of the service recipient paying it directly to Central Government for sponsorship services - Other than this allegation of wrongly paying the service tax on sponsorship service, there is no evidence of positive act of suppression of fact with intent to evade payment of service tax on the part of appellant. On t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vice and paid the same to the Central Government. The department was of the view that appellant being not eligible to pay service tax for sponsorship services, the input service availed for providing output service namely sponsorship service is not eligible for credit. Show cause notice was issued proposing to demand the ineligible input service credit of ₹ 10,88,958/- along with interest and also for imposing penalties. After due process of law, the original authority confirmed the demand along with interest and imposed equal penalty. In appeal, Commissioner (Appeals) upheld the same. Hence this appeal. 2. Ld. Counsel Shri T.R. Ramesh appeared and argued the matter on behalf of the appellant. He submitted that the various input se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the appellant had reflected all these details in their ST-3 returns which is admitted by the department in para 3.15 of the adjudication order. The period involved is from 2006 -07 to September 2009 whereas the show cause notice has been issued only on 14.10.2011, much after the normal period. Apart from a bald allegation that the appellant has suppressed the facts with intent to evade payment of service of tax, there is no iota of evidence to establish that the appellant is guilty of suppression of facts with intent to evade payment of service tax. At the most, it was only an erroneous payment of service tax on the part of the appellant. Instead of the service tax being discharged by the service recipient in the case of sponsorship se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid. For the same reason, the department alleges that for various input services like mandap keeper service, interior decorator service etc. consumed by the appellant used for the purpose of providing sponsorship service is not eligible for credit. The department has no case that the appellant has not paid the service tax on these input services nor is there a case that they are not used for providing sponsorship service. The only allegation is that the appellant ought not to have collected the service tax on sponsorship service. Generally, it is the output service provider who has to pay the service tax and in some cases like sponsorship services, the Service Tax Rules provide that the liability to pay service tax is upon the service recip ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t Engineering Ltd. Vs. CGST CE, Chennai in Final Order No. 41808 41809/2018 dated 13.6.2018 had occasion to analyse the eligibility of credit in respect of Manpower Supply services, where the assessee who is the service recipient has to discharge 75% of service tax directly to the Government. Though instead of paying on 25%, the service provider collected the entire tax from the assessee and paid to Government. The assessee thus availed credit on 10% of the service tax which according to department was not eligible. The Tribunal held in favour of assessee. From the above discussions, I hold that the demand raised for the extended period cannot sustain and requires to be set aside, which I hereby do. 6. In the result, the impugned ord ..... X X X X Extracts X X X X X X X X Extracts X X X X
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