9911796707
TMI Blog2018 (9) TMI 1147X X X X Extracts X X X X X X X X Extracts X X X X ..... enquiry was conducted, documents of appellant were verified, tax demand was made and the same was paid by the appellant in due course along with applicable interest but about a month thereafter it was noticed to submit show cause for such non-payment and suppression. Upon reply by the appellant, matter was adjudicated by the Jt. Commissioner, CST Vardha, Nagpur who confirmed the duty liability penalty for the extended period also and the same attained finality upon rejection of appeal filed by the present appellant before the Commissioner (Appeals). 3. During the course of hearing of appeal, ld. Counsel for the appellant submitted that the duty liability under reverse charge mechanism involves interpretation of various provisions of the Act and Rules. In respect of tax demand, payment along with interest has already been made by the appellant and they had abandoned their right to contest the tax liability when the matter was before the Commissioner (Appeals). In the present appeal, the appellant is only contesting penalty and the invocation of extended period since appellant, being pointed out by the department, immediately paid the amount of service tax along with interest much ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourse of routine audit, such evasion of duty was in fact discovered by the preventive branch officer on the basis of intelligence report as can be seen from the show-cause, Order-in-Appeal and order-in-original for which the appellants contention regarding bonafide belief of nontaxability or innocence should not be taken on its face value. Reiterating the order passed by the first adjudicating authority and the Commissioner (Appeals), the ld. AR submitted that as those orders are based on reasoned findings, interference by the Tribunal in the said order is uncalled for. 5. Heard from both sides and perused the case law, relevant provision contained in Section 66A of the Finance Act, 1994, the provisions of service tax Rules and the case laws cited by the adversaries. Admittedly, Section 66A provides to charge service tax on services received from outside India and received in India under Reverse Charge Mechanism but the contention of appellant, as found from the Order-in-Appeal, is that services provided by the overseas party as broker or agent was in respect of goods which were exported outside India to the parties located outside India and hence those services were performed abr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, 1994 that enables assessment beyond the extended period on grounds of suppression, non-disclosure etc. and to analyse if there was any ill intention on the part of the appellant to evade tax so as to impose penalty contemplated under Section 78 of Finance Act, 1994. 8. Proviso to Section 73 reads as follows:- "PROVIDED that where any service tax has not been levied or paid or has been short-levied or short-paid or erroneously refunded by reason of- (a) fraud; or (b) collusion; or (c) wilful mis-statement; or (d) suppression of facts; or (e) contravention of any of the provisions of this Chapter or of the rules made thereunder with intent to evade payment of service tax, by the person chargeable with the service tax or his agent, the provisions of this sub-section shall have effect, as if, for the words [Eighteen months] , the words "five years" had been substituted." Therefore for reason of fraud/collusion/wilful mis-statement/ suppression of fact or contravention of the provisions and rules intended to evade tax would entail the departmental officer to go beyond the normal period of 18 months and in such an eventuality as contemplated under Rule 4 that prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the department has levied the service tax on the consideration that appellant is residing in India. 10. During the course of hearing, the ld. Counsel for the appellant has placed his reliance on the Circular no. 137/167/2006/cx-4 dated 03.10.2007 and pleaded that in respect of payment of interest and penalty along with service tax in full, all proceeding against the appellant should have been closed but a close reading of the statute would reveal that in respect of Section 73(1)(a) of the Finance Act, 1994 adjudication proceeding can be concluded in cases of wilful suppression, fraud, collusion etc. if along with tax and interest, penalty equal to 25% of service tax was voluntarily paid by the assessee even one month from the date of issue of show-cause, which in the instant case is not done to make that circular applicable for the appellant. Similarly, in the case law submitted by the ld. AR, as referred supra, neither any reference is available to the circular dated 03.10.2007 nor any distinction is carved out between proviso to Section 73(3) and Section 73(4) to cover extended period etc. and read the same into section 73(3) proviso. In view of foregoing discussion, it cannot ..... X X X X Extracts X X X X X X X X Extracts X X X X
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