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TMI Blog2018 (7) TMI 1670X X X X Extracts X X X X X X X X Extracts X X X X ..... r the period from 01.10.2004 to 30.04.2006 and for 01.05.2007 to 30.11.2009 when the words “any other person” was not part of the definition under Section 65(105)(zm). The Tribunal had analyzed a similar issue in the case of Grama Vidiyal Trust [2018 (6) TMI 584 - CESTAT CHENNAI] has held that As it has already been found that the appellants would not fall within the ambit of ‘banking company or financial institution’ for the purposes of Section 65 (12) ibid, that allegation in the SCN and its confirmation in the impugned order cannot then be sustained. Appeal allowed - decided in favor of appellant. - Appeal Nos. ST/00023/2011 & ST/00118/2011 - Final Order No. 42115-42116 / 2018 - Dated:- 23-7-2018 - Hon ble Ms. Sulekha Beevi C.S., Member ( Judicial ) And Hon ble Shri Madhu Mohan Damodhar, Member ( Technical ) Shri. G. Natarajan, Advocate for the Appellant Shri. K. Veerabhadra Reddy, JC ( AR ) for the Respondent ORDER Per Bench Brief facts are that on the intelligence gathered by the Officers of Headquarters Preventive Unit, Madurai, it was revealed that the appellants are primarily engaged in micro-financing (small scale lending) to poor women membe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... setting up petty shops, handicrafts, etc. The loans are sanctioned in periodical meetings of the members as decided between the members and the loans are not sanctioned by the Trust as such. The obligation of repayment of the loan is also cast on the group and if any one member of the group defaults in repayment, the other members of the group are liable to repay the same and this ensures peer responsibility on the group to ensure repayment. Thus, the loans are not disbursed as in normal banking activities. Weekly meetings of the members are conducted to promote various objectives of the Trust. Loans carry interest which are prescribed by the Trust. At the time of disbursement of loans, certain nominal amounts are collected from the beneficiaries on voluntary basis for various purposes. The appellant also collects small amounts of deposits from their members to inculcate the savings habit and even ₹ 10/- are accepted as deposits. But no facilities like withdrawal through cheque, etc. are offered against such deposits. The savings can be withdrawn only upon cessation of membership and not before. Small amounts are collected for the purpose of group formation and maintenance, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent for this period only on the ground that the appellant would fall under the category of any other person although they may not fall under non-banking financial institution. 2.4 The Ld. Counsel relied upon the decision of the Tribunal in the case of Grama Vidiyal Trust Vs. C.C.E. S.T. Tiruchirappalli vide Final Order No. 40925/2018 dt. 22.03.2018 and argued that the Tribunal on the very same issue has set aside the demand. 3.1 On behalf of the Department, the Ld. AR Shri K. Veerabhadra Reddy, supported the findings in the impugned order for the period 01.05.2006 to 20.04.2007. He argued that during this period, the taxable service of the banking financial service was amended to include the words any other person . Thus, the appellants would fall within this category and, therefore, the Commissioner has rightly confirmed the demand for this period. 3.2 He supported the grounds of appeal stated in the appeal filed by the Department and argued that the appellants being a non-banking financial institution, are liable to pay service tax for the remaining part of the demand for the period 01.10.2004 to 30.04.2006 and also 01.05.2007 to 30.11.2009. 3.3 He also submitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that assessee is liable to pay service tax as they are rendering Banking and Other Financial Services as they are included in the category any other person . In fact, the categorical allegation in para 8.4 and 8.5 of the Show Cause Notice is that assessee is a non-banking financial institution and therefore is liable to pay service tax for the Banking and Financial Services. This being so, in our view, the Commissioner has traversed beyond the scope of Show Cause Notice to confirm the demand for the period 01.05.2006 to 30.04.2007. From the provisions of law reproduced above, it can be seen that the Commissioner has rightly dropped the demand for the period from 01.10.2004 to 30.04.2006 and for 01.05.2007 to 30.11.2009 when the words any other person was not part of the definition under Section 65(105)(zm). The Tribunal had analyzed a similar issue in the case of Grama Vidiyal Trust (supra) where the facts are identical and held as under : 5. There is no dispute, even in the SCN that appellants are a Registered Charitable Trust with registration No.1133/4.4.1997 as a Federation of Women in micro credit. There is also no allegation that they have been approved to function ..... X X X X Extracts X X X X X X X X Extracts X X X X
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