Final Order No. St/81/2011(Pb), arising from Appeal No. St/341/2007. Case: Ideal Security Vs Commissioner of C. Ex., Allahabad. CEGAT (Customs, Excise & Gold (Control) Appellate Tribunal) & CESTAT (Customs, Excise and Service Tax Appellate Tribunal)
| Case Number | Final Order No. St/81/2011(Pb), arising from Appeal No. St/341/2007 |
| Counsel | For Appellant: Shri B.L. Narasimhan, Advocate, and For Respondent: Shri Amrish Jain, Sdr. |
| Judges | Shri D.N. Panda, Member (J) and Mathew John, Member (T) |
| Issue | Finance Act, 1994 |
| Citation | 2011 (23) STR 66 (Tri - Del) |
| Judgement Date | February 03, 2011 |
| Court | CEGAT (Customs, Excise & Gold (Control) Appellate Tribunal) & CESTAT (Customs, Excise and Service Tax Appellate Tribunal) |
Order:
D.N. Panda, Member (J), (Principal Bench, New Delhi)
1. Ld. Counsel Submits That At The Initial Stage Of Introduction Of Law For Levy Of Service Tax Under Finance Act, 1994 In Respect Of Security Services, There Were Several Confusions About The Gross Value Of The Service To Become Measure Of Value For Payment Of Service Tax. Only Because Of The Confusion There Was A Discrepancy Between The Return And The Profit And Loss Account. While Revenue''s Claim Is That Entire Value Of Payments Received From The Consumer Of Service Shall Be Taxable, The Appellant Pleads Bona Fide Belief That Statutory Payments Like'' Esi, Pf Etc. Received, Not Being Consideration For The Services, Shall Not Be Taxable. Similarly They Plead That The Profit Earned On The Activity Shall Not Be Taxable, So Also Certain Other Expenses. According To The Appellant With The Bona Fide Conception The Appellant Submitted The Return And Disclosed The Receipts. There Was No Suppression Of Fact Made By Them In Respect Of The Payment Received, As It Was Furnished To The Authorities In The Course Of Adjudication. Only Because The Discrepancy Was Noticed By The Department By Comparing St3 Return With The Profit And Loss Account, The Adjudication Was Made. The Appellant Pleads That Because Of The Bona Fide Belief They Did Not Disclose The Total Receipts. It Is Also Normal Understanding That Certain Elements Of Recovery In Respect Of Security Services Shall Not Form Part Of Gross Value On Taxable Service. Therefore, The Appellant Prays That The Adjudication Can Not Sustain Both On Limitation As Well As On Merit.
2. Ld. Counsel Also Prays That Penalty Should Not Be Imposed On The Appellant For The Bona Fide Belief It Had, At The Early Stage Of Implementation Of Law.
3. Per Contra, Ld. Dr For The Revenue Submits That There Is Nothing For Debate On The Value Of Services. Tribunal Has Already Decided The Case Of Naresh Kumar And Co. Pvt. Ltd. V. Cst, Calcutta Reported In 2008 Tiol-1016-Cestat = 2008 (11) STR 578 (Tri.-Kolkata) And Held That Gross Receipt Shall Be Taxable Although It Was Held That Certain Items Like Payment Towards Esi Etc. Will Not Form Part Of The Value. Following That Decision, Tribunal Had Also Occasion To Deal With The Case Of Cce, Chandigarh V. M/S. Team S & S Reported In 2011 Tiol 33- Cestat-Del = 2011 (21) STR 290 (Tri. - Del.). Therefore, The Valuation Aspect Is Not Open For Further Argument In The Present Appeal.
4. So Far As The Limitation Aspect Is Concerned, Ld. Dr Submits That When The Appellant Failed To Provide Entire Detail To The Department And Brought A Discrepancy By Its Own Documents Namely Profit And Loss Account And St3 Return, The Proceeding Was Initiated Well Within The Time And The Action Is Not Time Barred.
5. So Far As Penalties Are Concerned The Ld. D.R. Argues That For The Finding Of Suppression, The Appellant Was Bound To Face The Consequence Of Penalty Under Different Provisions Of Law.
6. Heard Both Sides And Perused The Record.
7. When We Look Into Para 7 Of The Appellate Order, We Are Able To Confirm That There Was Difference In Two Sets Of Documents That Were Relied Upon By The Appellant. One Such Document Was St-3 Return And The Second One Is Its Own Balance Sheet And Profit And Loss...
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