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TMI Blog2025 (1) TMI 1440X X X X Extracts X X X X X X X X Extracts X X X X ..... WS). 2. Based on the verification of certain records like Profit & Loss accounts, ST3 returns, etc., the department felt that the appellants have not discharged proper Service Tax on the services relating to SWS, Goods Transport Agency service (GTA) and Renting of Immovable Property Service (RIS) and also recovery of certain amount collected as Service Tax but not paid to the Government. Thereafter, based on verification of records and statements recorded in this regard, the department issued two SCNs; one dt.31.05.2011, for the period 2006-07 to 2009-10 and another dt.19.10.2011, for the period 2010-2011, alleging, inter alia, that certain amount of Service Tax has been short paid towards SWS, RIS, GTA service and also for recovery of Rs.51,50,323/-, being Service Tax collected but not paid in view of provisions under Section 73A of the Finance Act, 1994. Both these SCNs were adjudicated vide OIO No. 12/2012 dt.22.03.2012 and OIO No. 14/2012 dt.28.03.2012 (impugned orders). On adjudication, barring a small relief of Rs.2,28,219/-, on account of demand being prior to 01.06.2007, the rest of the proposed demands were confirmed by the Adjudicating Authority. In addition, certain pen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Rule 5(2). 4.2. GTA Service:- i) He submits that they are providing transportation from railway terminal to their godown at the request of the cement companies and also to their customers/distributors directly from railway side and where they are initially incurring the expenses but reflecting the same as income on receipt of payment from the cement companies in their books of account. ii) In this regard, he also submits that since they are acting as GTA, in support of which he has shown detailed challans raised by them on cement companies and therefore, in terms of provisions under Rule 2(1)(d) of Service Tax Rules, 1994, the person liable to pay the Service Tax in this case would be the cement companies and not them. In fact, the cement companies have informed them (referred at Pg.354 of Vol-II), that they have discharged the applicable Service Tax liability on reverse charge basis on such transportation charges. iii) He further informs that they have not undertaken any transportation, ex-godown or ex-railway station directly to customer/distributor, etc., and the same is being arranged by the customers themselves. Therefore, there is no question of any income flowing on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the department, apart from reiterating the grounds taken by the Adjudicating Authority in the impugned order, inter alia, submits, as follows:- a) That the appellants have not been able to prove that they are pure agent, in so far as, it related to payment of wharfage and demurrage charges & GTA service. b) There was no evidence to suggest that it was paid on reimbursement basis. c) That the argument now taken by the learned Advocate for the appellant regarding imposition of penalty of Rs.1.1 crores highlighting that the demand is only Rs.1.1 crores and not Rs.2.3 crores as being brought to the notice of this Bench for the first time. It was not explained before the Adjudicating Authority. d) He supports the departmental appeal that there was provision for penalty @ Rs.200/day prior to 2011 amendment. Therefore, under the same provision, this being mandatory, the Commissioner could not have invoked penalty only @ Rs.100/day. 6. Heard both sides and perused the records. 7. The core issues to be decided is whether in the facts of the case, the demand levied on the appellant under section 73 under different categories viz., SWS, GTA and RIS as also under section 73A are s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sponsibilities and scope of work. Insofar as the scope of work is concerned, it is already reflected at Para 7 (supra). With regard to Annexure-A, we find that the rates have been prescribed for various activities covered within the ambit of rake handling contract and as per note 5, it was agreed that the appellant will pay wharfage and demurrage charges, if any, in time to Railways and inform the company for reimbursement. Therefore, we have perused these documents, which clearly show that it was agreed upon that initially the appellants would pay to railways the wharfage and demurrage charges and thereafter, claim the same on actual basis from cement companies. These documents support the submission of the appellant that they were merely paying on behalf of the cement companies and it was on reimbursement basis. The Adjudicating Authority has denied the exclusion of these charges primarily on the grounds that there is no evidence to suggest that this was being reimbursed on actual basis by the cement companies to the appellant, which, however, is not correct, in view of the representative documents submitted by the appellant. In any case, the department's stand is that in terms o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ile working out the liability under GTA service. 11. As far as allegation of Section 73A is concerned, we find that there is enough evidence to suggest that certain amount collected has already been paid and therefore, entire amount cannot be considered as recoverable. There is some dispute about actual amount of Service Tax paid from the amount collected, which has to be corroborated with the evidence. Therefore, this also needs to be ascertained. 12. As far as imposition of penalty on RIS is concerned, we find that penalty under Section 76, 77 & 78 would not survive if the payment including interest has already been made prior to 2012 itself. This also needs to be re-ascertained and reconciled before imposing penalty for balance amount of Service Tax collected but not paid before 2012. 13. As far as departmental appeal is concerned, we find that learned AR has pointed out that during the relevant period, the penalty under Section 76 was @ Rs.200/day or 2% of the tax amount, whichever is higher and therefore, the imposition of penalty @ Rs.100/day is not legally tenable. However, there is no clarity as to from which date or up to which date these rates were applicable. This als ..... X X X X Extracts X X X X X X X X Extracts X X X X
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