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TMI Blog2024 (4) TMI 790X X X X Extracts X X X X X X X X Extracts X X X X ..... pression of facts or contravention of any of the provisions of the said Chapter or of the rules made thereunder, with intent to evade payment of service tax. It would be appropriate to note the jurisprudential understanding of the concept of evasion. In Tamilnadu Housing Board v/s. Collector of Central Excise, Madras and Another [ 1994 (9) TMI 69 - SUPREME COURT] the Supreme Court has held that the word evade in the context of the Central Excise law would mean defeating the provisions of law of paying duty. Thus, evasion is one of the basic requirements for applicability of the extended period under the proviso to sub-section (1) and also in regard to applicability of sub-section (4) of Section 73 of the Finance Act, 1994. It is not in doubt that Respondent, much prior to the issuance of the show cause notice, paid the service tax as also the interest thereon. If this be the case, certainly, the designated officer was not correct in issuing a show cause notice to pass the Order-in-Original. It has been rightly interfered by the Tribunal observing that the department was not justified in invoking the extended period in the present case, and, more particularly, when the entire servic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2012 (25) STR 305 (Bom) , assailing such tax. On such proceedings, this Court by its Judgement and Order dated 19th January, 2012, upheld the levy and collection of tax on the said services. However, during pendency of the proceedings, which was between the year 2010 to 19th January, 2012, this Court had passed an Order directing the Respondent to keep any coercive action in abeyance. 4. After the decision of this Court in Maharashtra Chamber of Housing Industry (supra), on 24th January 2012, the Anti Evasion Unit (Service Tax) issued summons to the Respondent directing it to submit certain documents. Thereafter, another summons for a similar purpose was issued on 13th February, 2012. 5. On such backdrop, the Respondent on 17th February, 2012, obtained a Registration with the Service Tax Department. Respondent also paid self assessed service tax dues along with interest, the details of which are on record in the form of a Statement (page 44). The period in question is from 2010-11 to 2015-16 wherein, in the respective financial years as set out in the table, a total amount of Rs. 7,07,02,774/- came to be deposited by the Respondent towards service tax. 6. On 27th April, 2017, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion, the noticee declared their correct taxable value to the department. ... 11:- Now, therefore, M/s. Tharwani Infrastructures are required to show cause within 30 days of receipt of this notice to the Commissioner, Service Tax, Mumbai VII, having his office at 16th Floor, Satra Plaza, Sector 19D, Palm Beach, Vashi, Navi Mumbai 400 705, as to why: (a) Service Tax amounting to Rs. 7,07,02,774/- (Rupees Seven Crores Seven lakhs Two Thousand Seven Hundred and Seventy Four only) for the period from 01.07.2010 to 31.03.2016 inclusive of Education Cess and Secondary Higher Education Cess as detailed in Annexure A , should not be demanded and recovered in respect of taxable services provided and in terms of the proviso of Section 73(1) as amended of the Finance Act, 1994. (b) Service Tax amounting to Rs. 7,07,02,774/- (Rupees Seven Crores Seven Lakhs Two Thousand Seven Hundred and Seventy Four only) paid should not be appropriated against the duty liability as 11(a) above; (c) Interest at appropriate rate and as applicable in force should not be demanded and recovered from them under Section 75 of the Finance Act, 1994, on Service Tax that would be determined to be payable by them as pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y-five per cent of the service tax so determined i.e. twenty-five per cent of Rs. 7,07,02,774/- (Rupees Seven Crore Seven Lakh Two Thousand Seven Hundred and Seventy Four only). Provided further that the benefit of the aforesaid reduced penalty shall be available only if the amount of such reduced penalty is also paid within such period. 9. The Respondent, being aggrieved by the Order-in-Original, approached the Tribunal in the proceedings of the Appeal in question, which has been allowed by the impugned order. The Tribunal, while allowing the appeal of the Respondent has, inter alia, held that the Respondent had paid the entire service tax as ascertained by the Assessing Officer before issuance of a show cause notice, as also the Respondent paid the interest amount before issuance of the show cause notice. Hence, considering the provisions of subsection (3) of Section 73 of the Finance Act, 1994, which provide that, if the service tax provider, on the basis of its own ascertainment, pays service tax before issuance of show cause notice, the Department cannot issue a show cause notice. It was observed that the extended period could be invoked, inter alia, if the non-payment of serv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x, as also the interest, before issuance of the show cause notice, the department could not have issued the show cause notice invoking the extended period, ought not to be an acceptable proposition. It is her submission that the extended period under the proviso to sub-section (1) of Section 73 read with sub-section (4) was clearly attracted, hence on such count the impugned order passed by the Tribunal deserves to be set aside. 11. On the other hand, Mr. Jetly, the learned Senior Counsel for the Respondent in supporting the impugned order would submit that there is no error or illegality in the observations as made by the Tribunal in applying the proviso to sub-section (1) of Section 73 as also reaching to the conclusion, that this was not a case, where the extended period could be invoked by issuing show cause notice, as the Respondent s case clearly fell within the provisions of sub-section (3) of Section 73, as the tax as also the interest was paid by the Respondent prior to the issuance of the show cause notice. It is Mr. Jetly s submission that, on a plain reading of the show cause notice, it was clear that no case of suppression of material facts was made out, and, hence, no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Explanation : Where the service of the notice is stayed by an order of a court, the period of such stay shall be excluded in computing the aforesaid period of [thirty months] or five years, as the case may be. [(1A) Notwithstanding anything contained in subsection (1) (except the period of [thirty months] or serving the notice for recovery of service tax), the Central Excise Officer may serve, subsequent to any notice or notices served under that sub-section, a statement, containing the details of service tax not levied or paid or short levied or short paid or erroneously refunded for the subsequent period, on the person chargeable to service tax, then, service of such statement shall be deemed to be service of notice on such person, subject to the condition that the grounds relied upon for the subsequent period are mentioned in the earlier notices] [(1B) Notwithstanding anything contained in subsection (1), in a case where the amount of service tax payable, has been self-assessed in the return furnished under sub-section (1) of section 70, but not paid either in full or in part, the same shall be recovered along with interest thereon in any of the modes specified in section 87, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 75 shall be payable on the amount paid by the person under this sub-section and also on the amount of short payment of service tax or erroneously refunded service tax, if any, as may be determined by the [Central Excise Officer] but for this sub-section. [Explanation 2: For the removal of doubts, it is hereby declared that no penalty under any of the provisions of this Act or the rules made thereunder shall be imposed in respect of payment of service-tax under this sub-section and interest thereon]. (4) Nothing contained in sub-section (3) shall apply to a case-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. [(4B) The Central Excise Officer shall determine the amount of service tax due under sub-section (2)- (a) within six months from the date of notice where it is possible to do so, in respect of cases [falling under] sub-section (1); (b) within one year from the date of notice, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , on receipt of such information shall not issue any notice under sub-section (1) of Section 73 in respect of the the amount so paid. Hence, if the amount of tax is paid in the manner as recognized by subsection (3), necessarily the designated officer is under a mandate not to serve any notice under sub-section (1) in respect of the amount so paid. 17. In the context of sub-section (3), if sub-section (4) is to be seen, it is an exception to sub-section (3) when it begins with the words nothing contained in sub-section (3) shall apply to a case where any service tax has not been levied or paid or has been short-levied or short-paid or erroneously refunded by reason of fraud, collusion, wilful mis-statement, suppression of facts or contravention of any of the provisions of Chapter V or of the rules made thereunder with intent to evade payment of service tax. 18. Thus, applying such provisions to the facts of the present case, it is clear that there was no intention on the part of the Respondent to evade payment of service tax. By evasion, it would be meant that the assessee was eluding and avoiding to pay tax by trickery. The intention of the Respondent in the present case was not t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iled by the Assessee/ the Respondent in the aforesaid Central Excise Appeal as decided by the above judgement. By this Writ Petition, the Assessee has prayed for the following reliefs:- (a):- Issue a Writ of Certiorari or Writ in the nature of Certiorari or any other appropriate Writ, Order of Direction calling for the records and proceedings dealing with failure on the part of Respondent No. 1 to decide upon the Refund Application dated 10th July, 2023 filed by the Petitioner; (b):- Issue a Writ of Mandamus or Writ in the nature of Mandamus or any other appropriate Writ, Order of Direction directing Respondent No. 1, their servants and subordinates to decide upon the Refund Application dated 10th July, 2023 filed by the Petitioner and process/ issue the refund due to the Petitioner along with the consequential benefits including refund/ adjustment of taxes/interest paid in excess as well as refund of penalty set aside subsequent to the Final Order No. 85986/2023 dated 22nd June, 2023 passed by the Hon ble CESTAT, in a time bound manner, preferably within two weeks. 25. In view of the dismissal of Revenue s appeal by our judgement on the Revenue s appeal (supra), in our opinion, th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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