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TMI Blog2022 (11) TMI 926X X X X Extracts X X X X X X X X Extracts X X X X ..... component to the department, show cause notices were issued to all the three appellants. The matter has culminated in an order of adjudication which has been challenged by the said service provider before the Customs, Excise and Service Tax Appellate Tribunal, Kolkata Bench (CESTAT). The learned single Bench, by the impugned order, though separate orders, they contain the same reasoning, taking note of the fact that the service tax authorities had issued summons to the appellants and that the proceedings are yet to attain finality, opined that it would be appropriate to permit the service tax authorities to conclude the proceedings against the appellants in accordance with law - the authorities deciding the liability of the service tax und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the KMC, it will not be a binding adjudication. The three appeals are disposed of by this common judgement and order by directing the concerned Service Tax Commissionerate to issue fresh notices to the appellants as well as KMC which shall be treated as continuation of the earlier show cause notices. After hearing the parties, the concerned authority shall adjudicate the issue and pass a reasoned order on merits in accordance with law - no coercive action shall be initiated against the appellants till the adjudication is complete. X X X X Extracts X X X X X X X X Extracts X X X X ..... red by which they are to supply security guards in the municipal corporation. For easy reference, the appellant shall be known as 'service provider' and the KMC as 'service recipient'. All was well with the arrangement between the parties as KMC was reimbursing the service tax remitted by the provider to the department. However, on and after 4th January, 2014, KMC refused to reimburse the service tax component as raised in the invoice of the provider by placing reliance on the Municipal Commissioner's Circular No.83 of 2013-14. For better appreciation, the Circular is quoted hereinbelow : " The Law Department of Kolkata Municipal Corporation opined that the service rendered by the Kolkata Municipal Corporation and service given to K.M.C i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the same reasoning, taking note of the fact that the service tax authorities had issued summons to the appellants and that the proceedings are yet to attain finality, opined that it would be appropriate to permit the service tax authorities to conclude the proceedings against the appellants in accordance with law. The learned single Bench further pointed out that so far as the Circular issued by the KMC dated 4th January, 2014 is concerned, the view of KMC that they need not pay service tax may not be accepted by the service tax authorities. Further, the authorities deciding the liability of the service tax under the Finance Act, 1994 is the appropriate authority to adjudicate the liability of the appellant to pay service tax in respect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e inapplicable because it deals with services by a local authority and not services provided to a local authority. 9. The KMC has taken a stand as is evident from the Circular No.83 of 2013-14 dated 4th January, 2014 that the services rendered by them and services given to them in rendering public services is exempted from payment of service tax in view of Mega Exemption Notification No.25/2012-ST dated 20th June, 2012 issued by the Government of India since the functioning and duties of the KMC is concomitant to the public interest as enshrined in the Constitution of India. Therefore, the KMC opined that they are not liable to pay service tax in terms of the provisions of the said notification until further orders in view of the fact that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and ST/76382/2018. However, those appeals may not be proceeded since we are inclined to issue a comprehensive direction in these appeals to the Service Tax Commissionerate to commence and complete a fresh adjudication after issuing notice not only to the appellant but to the KMC as well. 10. In the result, the three appeals are disposed of by this common judgement and order by directing the concerned Service Tax Commissionerate to issue fresh notices to the appellants as well as KMC which shall be treated as continuation of the earlier show cause notices. After hearing the parties, the concerned authority shall adjudicate the issue and pass a reasoned order on merits in accordance with law. In the meantime, we request the learned CESTAT to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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