Bharat Sanchar Nigam Ltd vs C.C.E, Raipur

1. Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2. Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? Yes 3. Whether Lordships wish to see the fair copy of the order? Seen 4. Whether order is to be circulated to the Department Authorities? Yes

Application No.ST/MISC/51286/2014-CU[DB]

Appeal No.ST/106/2007-CU[DB]

[Arising out of Order-in-Original No.245/ST/Commr/2001, dated 09.08.2001 passed by the C.C.E., Raipur]

Bharat Sanchar Nigam Ltd. Appellant

Vs.

C.C.E, Raipur Respondent

Appearance

Mr. NK Singh, Advocate - for the appellant

Mr. Amresh Jain, DR - for the respondent

CORAM: Honble Justice G. Raghuram, President

Honble Mr. R.K. Singh, Member (Technical)

Final Order No.53325/2015, dated 03.09.2015

Per Mr. R.K. Singh :

Appeal has been filed against Order-in-Original No.245/ST/Commr/2001 dated 09.08.2001 and addendum No.V(ST)15-02/Dem/Commr/ 2000/Adj/Raipur, dated 27.09.2001. In terms of the Order-in-Original dated 09.08.2001 the following order was passed:-

The bills raised in July 1994 were for the services provided upto 15.6.94 and the service tax was levied on such services w.e.f. 01.7.94. Hence no service tax is payable on the billed amount in July 1994.

Further Ministry vide letter F.No.341/1/2000-TRU dtd.20.12.2000 clearly clarified that service tax is not leviable on the amount of surcharge collected for delayed payment of telephone bills. As such the amount of service tax demanded in the present Show cause Notice is not payable by Telecom Deptt.

When the amount of tax demanded is not payable there is no question of charging interest on delayed payment and no question of imposition of penalty. However the Superintendent, Central Excise Range Service Tax, Division Raipur should calculate the interest on delayed payment of Service Tax @ 1.5% (one and a half percent) for every month or part of a month other than the surcharge on delayed payment telephone bills of July 1994 and recover the amount.

I, therefore, withdrawn the Show Cause Notice and drop the proceedings.

After the order in original dated 09.08.2001 was issued the commissioner issued the following addendum

In Order-In-Original No.245/ST/Commr/2001 issued vide F.No.V(ST)15-02/DEM/COMMR/2000/ADJ/21046-50 dtd:09th August 2001 (1)(a) in para 3 of ORDER portion appearing in page 8 ^ 9 after the sentence:-

However the Superintendent, Central Excise Range Service Tax, Division Raipur should calculate the interest on delayed payment of Service Tax @ 1.5% (one and a half percent) for every month ___

1(b) The following sentence may be added:-

- by which the service the tax or any part thereof delayed and penalty of two hundred rupees for every day during which the failure continues but not exceeding the amount of Service Tax that he failed to pay, under Section 76 of the Finance Act, 1994 (32 9f 1994),:-

2(a) After the sentence in the same para (3) of the Order portion appearing in page 8 & 9 after the sentence:-

-other than the surcharge on delayed payment telephone bills of July 1994 and recover the amount.

2(b) The following sentence is added:

I also do not find any reason for imposing penalty under Section 78 of the Finance Act, 1994 (32 of 1994) as there was no suppression of taxable value found.

2. The appellant contended that (i) there was no delay in payment of service tax and the appellant was following the procedure prescribed by the Government. (ii) After the issue of the Order-in-Original, the adjudicating authority became functus officio and therefore the addendum could not have been issued by him. It states that it is not disputing the Order-in-Original dated 09.08.2001 but is contesting the validity of the addendum.

3. Ld. Departmental Representative conceded that the addendum imposing penalty could not have been issued without notice to the appellant and therefore the same cannot be sustained.

4. We have considered the facts of the case and the submissions of both sides. We need not go into the details of the case as the appellant is not contesting the primary adjudication order dated 09.08.2001. As regards the addendum dated 27.09.2001, the appellant is right in asserting that after the issuance of the Order-in-Original, the adjudicating authority became functus officio and therefore he could not have issued the addendum which essentially imposed penalty at least not without notice to it. In the case of Parwati Automotives Pvt. Ltd. Vs CCE, Kanpur [2011(264)ELT522 (Tri-Del)], CESTAT held that after disposal of the application, Tribunal becomes functus officio in that regard. Ld. Departmental Representative also concedes that the penalty could not have been imposed in this fashion by issuance of an addendum almost one and half months after the date of the Order-in-Original without notice to the appellant. Accordingly, we reject the appeal of the appellant-assessee against the primary adjudication order dated 09.08.2001 and allow its appeal against the addendum dated 27.09.2001 and set aside the said addendum.

5. Miscellaneous Application for early hearing filed by appellant-assessee also gets disposed of as a result of disposal of the appeal itself.

(Justice G. Raghuram)

President

(R.K. Singh)

Member (Technical)

SSK

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