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TMI Blog2025 (4) TMI 1289X X X X Extracts X X X X X X X X Extracts X X X X ..... not paying service tax as required. 2.2 Enquiry was initiated against the Appellant and it was observed that during the period April, 2013 to June, 2017 Appellant has short paid service tax amounting to Rs.11,61,686/- on the services provided by them. They had also not taken service tax registration in due time and also did not file any ST-3 returns during the said period. 2.3 A show cause notice dated 15.04.2019 was issued to the Appellant asking them as to why:- "17. Now, therefore, M/s Aman Vision, (Proprietor Shri Ranjeet Kaur), 38/131, 85, Gandhi Gram, Krishna Nagar, Kanpur is hereby required to show cause to the Deputy/Assistant Commissioner, Central Goods & Service Tax, Division-II, 117/7. Sarvodaya Nagar, Kanpur, as to why (i) The Service Tax amounting to Rs.11,61,686/- (including S. Tax, Education Cess, Higher Education Cess, Swach Bharat Cess and Krishi Kalyan Cess), as discussed above, should not be demanded and recovered from them by invoking extended period under proviso to Section 73(1) of Finance Act 1994 read with Section 68 of the Finance Act, 1994 and Rule 6 of Service Tax Rules, 1994, as the Service Tax has not been paid with intent to evade payment of Ser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant filed the appeal before the Commissioner (Appeals) who has vide the impugned order disposed of the appeal. 2.6 Aggrieved Appellant filed this appeal. 3.1 Counsel for the Appellant has requested for an adjournment. I have heard Shri Santosh Kumar, Authorized Representative for the Revenue. 3.2 As matter is in very narrow compass and has been settled decided in similar cases number of times, the request for adjournment made is not accepted and matter is considered on the basis of the available records. 3.3 Learned Authorized Representative for the Revenue reiterated the findings recorded in the impugned order. 4.1 I have considered the impugned order alongwith the submissions made in the appeal and during the course of arguments. 4.2 The impugned order records the findings as follows:- "4.1 I have gone through the records of the case, the averments made during the personal hearing and all other documents/material available on records. 4.2 I take up the issues one by one for decision. Firstly, the core issue of taxability on account of "Cable Operators under tile category of "Cable Services needs to be discussed. I observe that the Cable Operators Service provided by Cab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... another for consideration, and includes a declared service after introduction of negative tax regime w.e.f 01.07.2012. 4.3 I further observe that the CBEC vide Circular No. 80/10/2004-ST dated 17.09.2004, explained the changes made in the budget for 2004-05 as under: 17.09.20% of service tax on cable operators to Multi system operators (MSOs): In cable TV senises, broadcast channels transmit television signals to multi system operators (MSO) who further send them to the cable operator. The services provided by the MSOs to the cable operators have been made taxable". 4.3.1 Furthermore, CBEC vide circular No F.No.B11/6/12005-TRU dated explained the changes in the budget for 2005-06 as under: 27.07.2005, "In the case of radio or TV broadcasting services, the services are subject to tax where the services are effectively used and enjoyed. Multi System Operators (MSOs) are permitted to receive signals from the broadcasting agencies on payment of prescribed amount. Cable operators transmit programmes to customers through cable network after receiving signals from the multisystem operators (MSOs). Prior to 16.06.2005, service tax was leviable on services provided by cable operators ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e subscriber. 4.3.3 The same view has been taken by the Hon'ble High Court of Delhi in its judgment dated 09.03.2017 in the case of M/s Siti Cable Networks Limited vs Govt. of NCT of Delhi & ORS. [W.P. (C) 427/2014 & CM No. 851/2014)], Hon'ble Tribunal in the case of Krishna Satellite Cable Network vs CCE, Jaipur reported in 2008 (12) S.T.R. 605 (Tri. Del) and CESTAT, Chandigarh in its Final Order No- A/60167- 60171/2019 dated 22.2.2019 pronounced in the case of M/s Blue Star Communication & others Vs CCE, Ludhiana. 4.4 From the above discussion, it is clear that as the MSO had provided the service through the LCOs, the individual LCOs having their own subscription network were regarded as the cable operators and were liable to pay the service tax. Thus, the contention of the appellant that since MSO has already paid service tax, therefore, they are not liable to pay service tax is devoid of merit. 4.5 The appellant has also contested that in the present case the MSO were paying service tax on the same transmission received by them from the Television Channels and the cable operators again being asked to pay the service tax on the same transmission received from Telev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tatement to the effect that in terms of Cenvat Credit Rules, 2004, credit of the service tax paid on input services is available while paying service tax on output services. The same is also supported by Circular No. F. No. 82/8/2004- TRU dated 10-9- 2004, para 29. 10. Accordingly, both the writ petitions are dismissed". 4.6 Now I take the issue whether the appellant is providing branded service or not. I observe that in this case, the appellant is cable operator and providing cable services to the subscribers on the basis of signals received from the MSO i.e M/s DEN. The subscriber has not asked for any brand for providing the said services. In fact, the appellant is also not providing any branded service as M/s DEN is supplying signal to the appellant which has been transmitted to the subscribers, in that circumstances, there is no relation of brand name to the ultimate customers. Therefore, I hold that the appellant is not providing any branded service to the subscribers, therefore, the appellant is entitled to avail the benefit of exemption Notification No. 33/2012-8T dated 20.06.2012 subject to fulfilment of conditions mentioned in the said exemption notification. 4.6.1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iled statutory ST-3 returns showing availment /utilization of eligible CENVAT credit in the said returns. Thus, it is evident that the appellant failed to avail CENVAT Credit on input services within prescribed limit of six months/one year thereby Contravened the sixth proviso to the Rule 4(7) of the CENVAT Credit Rules, 2004. It is well settled principle that the claim of CENVAT Credit taken and/or utilized crystallizes only when the appellant has maintained CENVAT credit records & files statuary returns before the Department claiming the eligible CENVAT credit in the said returns. Thus, the CENVAT Credit can only be availed by filing the statuary ST-3 return, if no return is filed, it cannot be presumed that appellant has legitimate credit available within the prescribed time limit & would be available for infinite period of time. The appellant has also failed to maintained/produced any CENVAT record for availment of CENVAT credit within prescribed time limit, therefore, contravened the provisions of Rule 9(6) & Rule 9(9) of the CENVAT Credit Rules, 2004. Therefore, I am of the considered opinion that the appellant is not eligible for CENVAT credit due to non-fulfillment of condi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under:- Valuation (Service Tax) - Cable Operator Service - Deduction of Entertainment Tax - Notwithstanding that said Tax not shown separately in invoice as stipulated in C.B.E. & C. circular dated 1-8-2002, deduction of said tax from assessable value allowable if its payment otherwise established - in view of appellant submitting details of its payment to Government account through banking channel, matter remanded to adjudicating authority to verify payment particulars and if found in order, not levy any Service Tax on it - Section 67 of Finance Act, 1994. 4.3 Regarding the submission of the appellants for extending the benefit of cum-tax value, it is observed that it is not the case of the Department that the appellants had charged & collected Service Tax, from their customers, on the amount worked out on the basis of Entertainment Tax, without depositing such service tax in the Government account. Thus, I find that in this case, the appellants are entitled for the benefit of cum-tax value as per Section 67(2) of the Act. 4.4 As regards to the submission of the appellants that they are eligible for the benefit of threshold exemption of Rs. Ten lakh specified under the smal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of limitation. The demand should be restricted to normal period of limitation. Thus the matter needs to be remanded to the Original Authority for determination of the quantum of taxes for normal period. 4.5 As observed by in the impugned order Appellant is claiming Cenvat credit in respect of documents which are much older than period prescribed for availing the credit as per Rule 4 (7) of the CENVAT Credit Rules, 2004. I do not find that this issue was considered by the Commissioner (Appeals) in case of Alpha Cable Network(Supra) or the Chandigarh Bench in case of Blue Star. Rule 4 (7) of CENVAT Credit Rules is reproduced below: (7) The CENVAT credit in respect of input service shall be allowed, on or after the day on which the invoice, bill or, as the case may be, challan referred to in rule 9 is received: .... Provided also that the manufacturer or the provider of output service shall not take CENVAT credit after one year of the date of issue of any of the documents specified in sub-rule (1) of rule 9, except in case of services provided by Government, local authority or any other person, by way of assignment of right to use any natural resource: 4.6 This proviso to Rule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment to make rules for not allowing credit to be utilised for payment of duty on excisable goods, by Section 131 of Finance Act, 1999. Therefore, after this amendment reliance by the appellants on the decision in the case of Eicher Motors Ltd. v. Union of India will not help them. If a manufacturer wants to avail the benefit of Modvat credit in respect of inputs used in or in relation to the manufacture of final product on payment of duty on such final products under Rule 57A of the Central Excise Rules, he should follow the procedure laid down under the Modvat Scheme. The contention of the appellants is that if on the inputs the manufacturer had already paid the duty on the basis that when the goods are utilised in the manufacture of final product then tax on these goods are to be adjusted and this right accrued to the manufacturer on the date when they paid the tax on the inputs. The right will continue till the facility is available. A manufacturer who is working under the Modvat Scheme can certainly utilise the credit of the duty paid on the inputs used in or in relation to the manufacture of final product for payment of duty on such final product; but he has to take credit on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntroduced which, in our opinion, is permissible in law. Therefore, in our opinion, the law laid down by this Court in Eicher's case (supra) does not apply to the facts of these cases. This is also the position with regard to the judgment of this Court in Collector of Central Excise, Pune & Ors. v. Dai Ichi Karkaria Ltd. & Ors. [1999 (7) SCC 448]. 8. It is vehemently argued on behalf of the appellants that in effect by introduction of this rule, a manufacturer in whose account certain credit existed, would be denied of the right to take such credit consequently, as in the case of Eicher (supra), a manufacturer's vested right is taken away, therefore, the rule in question should be interpreted in such a manner that it did not apply to cases where credit in question had accrued prior to the date of introduction of this proviso. In our opinion, this argument is not available to the appellants because none has questioned the legality, or the validity of the rule in question, therefore, any argument which in effect questions the validity of the rule, cannot be permitted to be raised. The argument of the appellants that there was no time whatsoever given to some of the manufacturers to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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