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TMI Blog2025 (2) TMI 1112X X X X Extracts X X X X X X X X Extracts X X X X ..... on in relation to works contract around 2014 only, will need special consideration of Commissioner (Appeals).
The Learned Commissioner giving his decision will look into the decision of KONE ELEVATOR INDIA PVT. LTD and decide the limitation keeping in mind that the law came to be settled only around that time. Further, if appears that only some portion of limitation will survive if decided against the party, then question of penalty shall be accordingly decided. Party shall be free to support its stand on limitation with any case law or established facts.
Conclusion - Matter remanded to the Commissioner (Appeals) to consider the impact of the Kone Elevator India Pvt. Ltd. judgment on the limitation period and penalties.
Matter is remanded for Commissioner to pass a reasoned decision on limitation as well as to finally quantify the sustainable demand and penalty as per law - Appeal allowed by limited remand. X X X X Extracts X X X X X X X X Extracts X X X X ..... tax on the amount received in FY 2011-12 to 2015-16 from M/s. Maspero as the word "to any person" in the definition of service under (zzd) 65(105) of the Act does not need to be a 'customer' of the service provider, but can be "any person other than the service provider also. The appellant thus was alleged to have contravened provisions of Finance Act, 1994-Section 66, 68 R/w Rule 6 of Service Tax Rules, 1994, section 70 R/w Rule 7 of ST Rules, 1994 as they failed to pay the service tax totally amounting to Rs. 49,87,484/- for period from 01.04.2011 to 31.03.2016 as not shown value of these service in his ST-3 returns even if presumably export. 2. Thereafter, the Learned Assistant Commissioner (adjudication) adjudicated the said SCN vide his Order-in-original (010) dated 31.07.2017 holding, inter alia, as follows : that as per Export of Service Rules, 2005, the appellant service under Rule 3(1)(ii) does not qualify as "Export of Service" since it was performed in India on the direction of M/s. Maspero Elevatori, Italy, thus, services provided before 20.06.2012 are also taxable. Section 65B of the Finance Act permits taxation of services in the taxable territory. CBEC Noti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ligare Securities Ltd v CCE -2014 (36) S.T.R. 937 (Tri. - Del.) It was submitted that it is settled law that for invoking the Proviso to Section 73 (1) and for imposition of penalty under Section 78 of the Finance Act 1994, there must be some positive and deliberate act of concealment or clandestine activity. In the present case there was no such concealment or clandestine activity. The Appellant has maintained complete record of the transactions in question which are duly reflected in the Appellant's accounts and it is on scrutiny of these very documents maintained by the Appellant in normal course of business that the department of service tax raised the issue whether the transactions are liable to service tax. It was submitted that in absence of any evidence of positive act of suppression mere non-payment of tax is not enough to invoke extended period. The appellant in this behalf relied upon the following judgment: i. Chemphar Drugs and Liniments - 1988 (40) ELT 276 Further, during the disputed period, legislature had introduced provisions to bring clarity by way of introduction of place of provisions (POP) of service rules, 2012 It shows that there was not much clarity ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the goods gets transferred to the buyer of goods and not M/s. Maspero. The buyer in India has thus made the goods available i.e. elevators to the appellant for being erected, commissioned and installed at their premises. In this situation as per Rule 4(a) of POP Rules, the place of provision of service is the place where services are actually performed which is situated in India. 5. The appellant's argument with regard to limitation, the issue of non payment of service tax came to knowledge of the department during the course of audit of the records of the appellant. Hence the extended period has been rightly invoked as there is a clear case of suppression of facts as the appellant had neither filed any service tax return nor declared any taxable value for the services rendered by them and therefore liable for penalty u/s 78 of the Finance Act, 1994. 6. The adjudicating authority has correctly imposed penalty u/s 78(1) of the Finance Act, 1994 and penalty u/s 77(2) for failing to assess their tax liability and file ST-3 returns. The appellant was also liable to pay interest at appropriate rate u/s 75. 6. In rejoinder, the advocate for the appellants vide letter date ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etc. made the same as 'work contract' only in 2014 . Same came to be ultimately considered as a service in cases of indivisible composite contract for sale and services which involved both sale of goods and services as works contract finally in relation to lifts and their installation. The Apex Court had departed and overruled earlier decision of the Apex Court reported in 2005 (181) ELT 156 (S.C) in the matter of KONE ELEVATOR INDIA PVT. LTD only, that such composites contracts involving manufacture supply and installation of lifts in a building was essentially not a contract of sale of goods but a works contract. It was the appellants submission that when position has been finally clarified by the Apex Court only vide order dated 06.05.2014, it cannot be said that position was not fluid for the majority of the period under contention and therefore the demand was barred by limitation and only normal period involved could have been worked out. This Court finds that the Hon'ble Commissioner (Appeals) did not have the benefit of going through the decision as reported in 2014 (304) ELT 161 (S.C) in the matter of KONE ELEVATOR INDIA PVT. LTD VS. STATE OF TAMIL NADU and developments pr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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