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TMI Blog2023 (7) TMI 1336X X X X Extracts X X X X X X X X Extracts X X X X ..... olerating the mining activity by the Government. And for such act of toleration by the Govt., the appellant have paid compensatory levies/charges to CAMPA Fund which is being administered under the aegis of Central Government. Accordingly, the impugned order justified the demand and confirmed the same. The clearance granted by Ministry of Environment, Forest and Climate Change for usage of the forest land falling under the said project for non forest purposes, cannot be considered as a Declared Service as defined under Section 66E(e) of the Finance Act, 1944 and the charges of NPV paid by the Appellant cannot be considered as Consideration for the said service - the demand of service tax along with interest, in the impugned order is not sustainable. Extended period of limitation - penalty - suppression of facts or not - HELD THAT:- The Appellant has not suppressed any information from the department. In fact the entire NPV was paid to the CAMPA Fund as per law. Hence, extended period cannot be invoked to demand Service tax. As there is no suppression established, penalty under Section 78 of the Finance Act, 1994 not imposable in this case. The impugned order set asi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... )(d)(i) E of Service Tax Rules read with Notification No. 30/2012 ST dated 20.06.2012 in respect of taxable services notified under Section 68(2) of the Act, under reverse charge mechanism. I confirm the demand of Service Tax including SB Cess KK Cess amounting to Rs.3,37,43,465/- (Rupees Three Crore Thirty Seven Lakh Forty Three Thousand Four Hundred Sixty Five) only not paid by the Noticee i.e. M/s Mahanadi Coalfields Ltd (Orient Area) having registered at GM Office, Orient Area, Brajraj Nagar, Jharsuguda-768216, Odisha under proviso to Section 73(1) and Section 73(2) read with Section 119 of Finance Act, 2015 and Section 161 of the Finance Act, 2016; and order for recovery of the same from the Noticee; I order for recovery of interest from the Noticee, at the appropriate rate (s) on the amount confirmed at Para (ii) above, under provision of Section 75 of the Finance Act, 1994; I impose penalty of Rs.3,37,43,465/- (Rupees Three Crore Thirty Seven Lakh Forty Three Thousand Four Hundred Sixty Five) only on the Noticee under Section 78 of the Finance Act, 1994 for suppressing the facts from the department with an intent to evade payment of service tax. However, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ellant. 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 block 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. It is unthinkable to say that the land-owner has tolerated the acquisition of his land as per an agreement and charge service tax on the compensation. Equally unthinkable is to say that the Government employee has tolerated the non-sanction of leave during his service as per an agreement and in consideration, received the leave encashment at the time of retirement and to charge service tax on the amount received as leave encashment. These, cannot be called taxable services of tolerating a situation by way stretch of imagination. No service tax can be levied on the amounts received by the appellant as compensation. ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... function for urban forestry, protection of the environment and promotion of ecological aspects is also covered. (x) The Appellant submits that even if it is assumed that service under Section 66E(e) has been provided by the Government then also the appellant would still be entitled to avail exemption provided under entry serial no. 57 of Notification no. 25/2012 (supra) which reads as Services provided by Government or a local authority by way of tolerating non-performance of a contract for which consideration in the form of fines or liquidated damages is payable to the Government or the local authority under such contract . 4. The Ld. A.R reiterated the findings in the impugned order. 5. Heard both sides and perused the appeal records. 6. The issue to be decided in the present appeal is whether the Appellant has rendered any Service as defined in clause (44) of Section 65B of the Finance Act, 1944. As per clause (44) of Section 65B, Service means any activity carried out by a person for another for consideration, and includes a Declared Service . Clause (22) of Section 65B of the Act defines Declared Service as an activity carried out by a person for anoth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... form of Net Present Value, Compensatory Afforestation Charges and other such site specific charges are required to be paid to make good the damage caused by such user agency. In the process, application for non-forestry use of forest land is made by the user agency to Ministry of Environment Forest, Govt. of India, and final approval for such non-forestry use of such forest land is given by Ministry of Environment Forest, Govt. of India, on payment of specified charges as mentioned above and after receiving recommendation of the concerned State Government. 8.2. We find that Tribunal Kolkata has decided a similar issue in the case of MNH Shakti Ltd Vs Commissioner of Central Excise and Service tax, Rourkela, wherein it has been held as under: 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 had a choice to tolerate or not; (c) Such tolerance was for a consideration as per an agreement (written or otherwise) to tolerate; (d) The tolerance was a taxable service. None of the above elements are present in the present case. T ..... X X X X Extracts X X X X X X X X Extracts X X X X
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