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TMI Blog2008 (12) TMI 43X X X X Extracts X X X X X X X X Extracts X X X X ..... i Vikas Balia and Tribhuvan Gupta, for the respondents. [Judgment per : N. P. Gupta, J.]. -All these five appeals involve common question of law, being as to whether the circular issued by the Central Board of Excise & Customs dated 20.9.2004, as referred to in the order under appeal, governs the case of the respondent? 2. Appeals no. 26/2007, 70/2006, 3/2007, and 74/2006 were admitted on different dates, by framing substantial question of law, may be differently worded but purportedly to cover this controversy. However, appeal No.54/2007 was admitted on 23.10.2007, without framing any substantial question of law. However, in view of the above, the said question is hereby framed in this Appeal No. 54/2007 also. 3. The facts in all the five appeals are different, as they are different assessees, carrying on different types of business, did not get registration as required by the relevant chapter, introduced by the Finance Act, 1994, relating to imposition of Service Tax, hereafter referred to as the "Service Tax Act", and notices were issued. Thereupon adjudication of liability of amount of tax and penalty was made. The matter was carried in appeal, and then the matter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation for registration, acknowledgment, and declaration. However, the benefits flow from the contents of the communication itself, and therefore, we may gainfully quote the communication dated 20.9.2004, which reads as under:- "D.O.F.No.137/39/2004-CX.4 20th September 2004 My Dear Chief Commissioner, Subject: Extra-ordinary taxpayer friendly scheme for instant registration of service providers. Hon'ble Finance Minister has launched an extra-ordinary taxpayer friendly Scheme for registration of those service providers who have not got themselves registered so far. The details of the scheme are enclosed as annexure. This scheme aims to register all service providers on the basis of their declaration and who had earlier failed to register themselves with the department due to ignorance or any other reason with full waiver of penalty. This scheme is effective with immediate effect. As per the scheme any service provider can make a declaration to the department with regards to his past liabilities towards the service tax and interest payable. Without any inquiry or questions, the departmental authorities will accept the declaration and on the spot give a registration to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... __ 2. Address of the business premises :__________________________ 3. Date of Commencement of Business:________________________ 4. Taxable Services :______________________________________ 5. Date from which service tax is payable:_______________________ Turnover of the services since the date when service tax became payable: Financial Year Turn over of taxable services rendered Service Tax payable Interest payable, if any 6. The declaration with regards to the Service tax and interest payable given above is correct and true to the best of my knowledge. 7. Along with this declaration I am enclosing the details in Form ST 1 for being registered with Service Tax department. 8. Signature :________________________________ 9. Place :___________________________________ 10. Date :___________________________________ Notes: (a) The service tax is payable @ 5% upto 14th May 2003, 8% for period between 14th May 2003 and 10th September 2004 and 10% for period after 10th September 2004. (b) For period after 10th September 2004, education cess @ 2% of Service Tax payable is also to be paid. (c) Interest is payable @ 24% upto 11th May 2002, 15% for period between 11th May 2002 an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed representative. ***************** F.No.137/39/2004-CX.4 Government of India Ministry of Finance Department of Revenue Central Board of Excise and Custom New Delhi, the 22nd September, 2004 To All Chief Commissioners of Central Excise. Subject: Extra-ordinary taxpayer friendly scheme for registration of service providers. I am directed to refer to the D.O. of even number dated 20th September, 2004 on the above mentioned subject. D.G.(ST) has pointed out some error in the annexed "declaration form". The revised declaration forms are enclosed herewith for necessary action at your end. Yours faithfully, Sd/- Encls:As above (Sanjiv Srivastava) Deputy Secretary (CX.4) Office of the Chief Commissioners Central Excise (JZ) Jaipur CN CCO(JZ) ST/38/2004 3701 Date: 23.9.2004 Copy forwarded to the Commissioner Central Excise, Jaipur-I and Jaipur-II in continuation to this office endorsement of even No. NIL dated 20.9.2004 for information and necessary action please. Sd/- Deputy Commissioner (CCO) Central Excise Commissionerate, Jaipur-II C.No. V(ST) 30/37/JP-II/04 Dated:24.9.04 Copy forwarded to the Deputy/Asstt. Commissioner, Central Excise Division, Ajm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... drew our attention to the provisions of Section 83 of the Service Tax Act, whereby provisions of Section 37B of the Central Excise Act, 1994 have been made applicable, and contended, that this circular has been issued in accordance with Section 37B of the Central Excise Act. Section 37B of the Central Excise Act reads as under:- "37B Instructions to central excise officers- The Central Board of Excise and Customs constituted under the Central Boards of Revenue Act, 1963(54 of 1963), may, if it considers it necessary or expedient so to do for the purposes of uniformity in the classification of excisable goods or with respect to levy of duties of excise on such goods, issue such orders, instructions and directions to the Central Excise Officers as it may deem fit, and such officers and all other persons employed in the execution of this act shall observe and follow such orders, instructions and directions of the said Board: Provided that no such orders, instructions or directions shall be issued- (a) so as to require any Central Excise Officer to make a particular assessment or to dispose of a particular case in a particular manner; or (b) so as to interfere with the discre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onveys launching of some extra ordinary tax payer friendly scheme, and no such scheme has seen the light of the day, except this communication, which only encloses therewith certain proformas. As such it cannot be said to be any "Scheme", in true sense of the term. 12. With this background it may be noticed here, that this communication dt.20.9.2004 had been subject matter of adjudication by various Tribunals, in umpteen number of cases. Before going through those cases, we think it appropriate to first deal with the cases cited by the learned counsel for the Revenue, basically about principles of interpretation. 13. The first judgment cited is the case of The Commissioner of Sales Tax, U.P., Lucknow Vs. Parson Tools and Plants, Kanpur, reported in AIR 1975 SC 1039, and learned counsel referred to para 22 onwards. In this case, the question was, that an appeal was filed before the Dy. Commissioner which was dismissed in default. Then application for restoration thereof was filed, which remained pending for quite some time. In the meantime, the provision authorising dismissal of appeal in default was struck down. Obviously therefore, the original dismissal was treated to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation. 15. In our view, so far as the provision of deposit, under the communication dt.20.9.2004 is concerned, being 30.10.2004, there is no dispute, that it is required to be strictly construed, and in all the cases in hand, admittedly, the amount has been deposited before the said date, as obviously if the amount had not been deposited, the assessee would not have been entitled to any benefit of this communication. There is also no dispute about the proposition, that in taxing statute there is no room for any intendment, and regard must be had to the clear meaning of the words, and that the matter should be governed only by the language of the notification. The difficulty is, that this communication dt.20.9.2004 is neither notification, nor a taxing statute, rather as held above, it is only an administrative instruction, granting benefits and reliefs, in an attempt to cast service tax net wider and wider, and to augment the revenue. 16. The next judgment relied upon is, in Union of India & Ors. Vs. Wood Papers Ltd., reported in 1990 (47) E.L.T. 500 (S.C.) = (1990) 4 SCC 256. In this case also, it has been held, that exemption notification has to be read as a whole, and is requi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upon is Tele Tech Communication Vs. Commissioner of C. Ex. dt.4.6.2007 [2007 (7) S.T.R. 695 (T), rendered by learned Single Member, Shri C.N.B. Nair, reported in MANU/CE/8215/2007. In that case, the Tribunal had found, that the scheme makes it clear, that service providers were welcome to avail of the scheme, irrespective of whether proceedings have been initiated or not. In that view of the matter, the assessee was held entitled to the benefit of exemption from penalty. In that case, the assessee had applied for registration only after being served with a notice. 21. Then the next case relied upon is the order of the Tribunal West Zonal Bench, Mumbai dt.17.10.2006, in Laxmichand Dharshi Vs. Commissioner of C. Ex., rendered by the learned Single Member Shri K.K. Agarwal, reported in 2007 (5) S.T.R. 128 (T) = MANU/CM/7027/2006. In that case also, the facts were, that the assessee did not pay tax, nor did file return, for the period 1.10.2002 to 30.4.2003, and deposited the tax and interest on 10.2.2004. Penalty was defended on the ground of delay being unintentional. However, when the matter went to the Tribunal, relying on the judgment in Bharat Security Services & Worker's ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4/2008, where again relying upon the judgment in Bharat Security Services & Worker's case, the revenue's appeal was dismissed. 25. The next case relied upon is of Tribunal West Regional Bench, Ahmedabad dt.23.3.2007, in Care Electronics Ltd. Vs. Commr. C E, rendered by the learned Member, Archana Wadhwa, reported in 2007 (7) S.T.R. 273. In this case, the tax for the period 1.7.2003 to 30.4.2004 was not paid. However, on detection by Revenue the same was deposited on 6.8.2004, along with interest, and the learned Tribunal, relying on the judgment in Bharat Security Services & Worker's case held, that no penalty is imposable on the assessee, and the penalty was set aside. 26. The next judgment relied upon is of Principal Bench Delhi dt.14.2.2006, in CCE Vs. Shri Kamlesh Kumar Agarwal, Prop. of Mamta Travels, reported in 2006 (4) STR 205, rendered by the learned Member, Shri M.V. Ravindran. In this case, the Commissioner had set aside the penalty by holding as under:- "As regards the imposition of various penalties under the different Sections quoted above for violation of the relevant provisions, I find that there are catena of decisions of various appellate for a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee was not aware of the leviability of service tax upon him. Then in appeal reliance was placed on scheme floated by communication dt.20.9.2004, and contended, that admittedly, assessee has paid tax before 30.10.2004, while the counsel for the Revenue argued, that the assessee was registered with effect from 29.9.2003, and as such the provisions of this scheme would not apply, and reliance was placed on C.C.E. Bhopal Vs. Mankodi Enterprises, reported in 2006 (2) S.T.R. 150, and Pankaj Oil Trading Corporation Vs. CCE Ahmedabad, reported in 2007 (6) S.T.R. 44, and the learned Tribunal found, that both these cases related to payment of service tax after registration, whereas in the present case, the dispute is, as regards the service tax prior to the period of registration. As such, the ratio of the law as declared in both the cases is not applicable. Then relying upon Bharat Security Services & Worker's case, it was held, that assessee is entitled to the benefit of the said scheme, if the service tax for the past period stands paid by him by 30.10.2004. It was also noticed, that Bharat Security Services & Worker's case has been followed by the Tribunal in the case of Soldi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere paying service tax. Thus, the order waiving penalty, on the basis of circular was set aside. It is a different story, that ultimately in the order, the learned Tribunal modified the penalty, and reduced to a total amount of Rs.17,500/-. 31. Then in Pankaj Oil Trading Corporation's case, which is a judgment dt. 20.11.2006, did consider the judgment in Bharat Security Services & Worker's case, and Mankodi Enterprises' case as well. In that case the assessee had received commission for the period from 1.9.2000 to 31.6.2001 and 1.7.2001 to 31.12.2001, and was liable to pay service tax, and even after obtaining registration, service tax was not paid in its entirety, and did not file any service tax return. The Assistant Commissioner found, that the assessee failed to disclose the value of taxable service, and suppressed it, and thereby evaded the service tax, by not filing the returns. Then, the tax liability, after adjusting the amount already paid, was adjudicated, and penalty was imposed. The Appellate Commissioner reduced the penalties. Then, before the learned Tribunal, the assessee relied upon the Amnesty scheme, and also relied upon the judgment of learned Single ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clear that, no judgment of any High Court, or the Hon'ble Supreme Court, has been cited on either side, which may have taken into consideration the Amnesty Scheme, circulated vide this communication dt. 20.9.2004. 34. In our view, thus, the majority of the judgments do take the view, that the benefit of the scheme is available to the assessees, who were already registered though belatedly, and had deposited the entire amount of tax and interest, before the cut off date, prescribed in the scheme being 30.10.2004. 35. We feel constrained to consider the norms of judicial propriety, repeatedly laid down by the Hon'ble Supreme Court, in the matter of taking different views by the coordinate Benches, and the requirement of referring the matter to the larger Bench, if a different view is sought to be taken. 36. If all the judgments mentioned above are considered on that basis, it is clear, that all the judgments have been rendered by the different learned Single Member of the different Benches, and so far Principal Bench of New Delhi is concerned, there also a view, different from the view taken in Mankodi Enterpries and Pankaj Oil Trading Corporation's cases has been take ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... istered, even before the commencement of the Amnesty Scheme, and has paid all dues of tax and interest, before the cut off date given in the scheme, being 30.10.2004, would be entitled to the benefit of the Amnesty Scheme. And therefore there is no occasion for this Court to unsettle the settled position, and now give rise to upheaval, to generate litigation, even in the matters, which stand closed. This is second aspect of the matter. 41. Still most important aspect of the matter is, that even if we were to consider the matter on merits, as held above, the communication dt. 20.9.2004 is only an administrative instruction, issued for the benefit of the service providers, who volunteered to get themselves registered, and discharged all their liabilities of tax and interest, upto the cut off date, by providing immunity from penalty. This is beneficial part of the instruction for the service providers, while it is sought to be beneficial to the State, i.e. the Revenue, viz. it is intended to cast the net of the service tax wider and wider, and to augment the revenue. Thus, the instructions are calculated with the motive to benefit both sides, the service provider as well as the Reven ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... registered on 19.9.2004 itself, and did not allow his default to continue for one more day. The interpretation sought to be projected by the Revenue, does not thus stand the scrutiny. On the other hand, a proper reading of the communication does only show, that it is intended to provide immunity to the defaulters, who choose to deposit the arrears of tax and interest by the cut off date, and obviously, since for payment or deposit of the amount, the formalities of registration and declaration are necessary, the forms have been enclosed with the communication, and it has been directed, that the declaration would be accepted, and they would be given spot registration without any sort of questions. Much of the stress laid on the requirement of submitting declaration cannot be accepted, for the simple reason, that as observed above, the forms are prescribed under the relevant Rules of Service Tax itself; the Application Form being ST-1, Acknowledgment also forming part of the same form. So far declaration proforma is concerned, if it were to be read, would show, that it is only in the nature of forwarding letter of the application for registration, and nothing beyond that. Thus all tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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