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TMI Blog2021 (11) TMI 427X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the cancellation, only a compensation provided for statutorily for the investment made in the mines by the appellant. Even in cases where any amount is received under a contract as a compensation or liquidated or unliquidated damages, it cannot be termed Consideration . This case is not even a case of payment under a contract. Both the cancellation of the allocation of the blocks and the receipt of compensation are by operation of law. They are like the receipt of a compensation when one s land is acquired by the Government in public interest or the payment to a Government employee of an amount equal to the salary for unused leave at the time of his/her retirement - the Government employee has tolerated the non-sanction of leave dur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Special Provisions) Rules, 2015 were enacted which provided for a compensation to be paid by the new allottees to the old ones (such as the appellant) in lieu of the financial loss incurred. Section 9 of CMSPA provides that a part of the proceeds, collected from the new allottees was to be paid to the old allottees as compensation. 2. The appellant received compensation under this Act from the new allottees through the Government. A SCN dated 18.10.2019 was issued by the DG, GSTI, Bhubaneswar alleging that the appellant tolerated the act of cancellation of coal blocks by the Ministry of Coal and received a compensation in lieu of the cancellation and that this activity of the appellant appears to be covered by the definition of service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Two Thousand Five Hundred only), under Section 78(1) of the Finance Act, 1994 for wilful suppression of taxable value of services and wilful contravention of statutory provisions and rules made thereunder with the intent to evade payment of Service Tax, on the Noticee. Provided that where the service tax confirmed at sub-para (i) above and the interests payable thereon are paid within a period of 30 (thirty) days of the date of receipt of this order, the penalty payable shall be twenty five percent of the service tax demand confirmed at sub-para (i) above, provided also that the benefit of reduced penalty shall be available only if the amount of such reduced penalty is also paid within a period of 30 (thirty) days of the date of receipt of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e or to tolerate an act. d) As per the explanation (a) to Section 67, Consideration includes any amount that is payable for the taxable services provided. Since this is an inclusive definition, Guidance Note dated 20.6.2012 issued by the CBEC has advised that section 2(d) of the Contract Act, 1872 may be referred to. This defines consideration as: When, at the desire of the promisor, the promisee or any other person has done or abstained from doing, or does or abstains from doing, or promises to do or to abstain from doing, something, such act, or abstinence or promise is called a consideration for the promise. In the present case, the appellant has not promised to abstain from doing or tolerate any situation at anybody s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellant till their cancellation by the Supreme Court, the appellant had invested in mining in these blocks. Similar was the case with other allottees. In order to take care of this situation, CMSPA was passed which provided for payment of compensation to the old allottees by the new allottees. The appellant received such compensation through the Government. The case of the Revenue is that the appellant is tolerating the act of cancellation and has received this amount as consideration for such tolerance. 6. The question of tolerating something and receiving a compensation for such tolerance pre-supposes that: a) the person had a choice to tolerate or not; b) the person chose to tolerate; c) such tolerance was for a consideratio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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