M/S Chankya Enterprises vs Cce&St, Jaipur
- CitationService Tax Appeal No. 50999 of 2014 with
Ratio decidendi
The rule this decision rests on
Where the demand relates to a period before 01.07.2006 for works contracts, the demand for the period up to 31.05.2007 is prima facie not sustainable, in view of the Supreme Court's decision in Larsen & Toubro Limited, which held that works contracts were not liable to service tax prior to 01.07.2006. Where the service rendered involved supply of goods, the assessee is prima facie entitled to the benefit of the abatement notifications (Notification No. 1/2006-ST or 12/2003-ST), and the non-extension of such benefit weighs against the pre-deposit ordered. Where the assessee contends that the extended period of limitation is not invocable, and the Tribunal has prima facie reason to accept that contention, a pre-deposit ordered at a higher level than warranted may be reduced; the Tribunal may accordingly remand the matter to the Commissioner (Appeals) with a reduced pre-deposit condition of 10% of the impugned service tax liability, to be confirmed within thirty days.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
1 Whether Press Reporter may be allowed to see the Order for publication as per Rule 26 of the CESTAT (Procedure) Rules, 1982?
2 Whether it should be released under Rule 26 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3 Whether their Lordships wish to see the fair copy of the Order?
4 Whether Order is to be circulated to the Departmental authorities?
Service Tax Appeal No. 50999 of 2014 with
Service tax Stay Application No. 51161 of 2014
(Arising out of modification order No. 03/OPD/ST/JPR-II/2013 dated 23.01.2014 passed by the Commissioner of Central Excise-II, Jaipur).
M/s Chankya Enterprises Appellant
Vs.
CCE&ST, Jaipur Respondent
Appearance:
Sh. O. P. Agarwal, C. A. for the appellant-assessee
Ms. Suchitra Sharma, Commissioner (AR) for the Revenue
Coram:
Honble Mr. Justice G. Raghuram, President
Honble Mr. R. K. Singh, Member (Technical)
Final Order No. 52872 / 2015
Per: R. K. Singh:
Stay application alongwith appeal has been filed against modification of stay order 03/OPD/ST/JPR-II/2013 dated 23.01.2014 in terms of which the Commissioner (Appeals) ordered pre-deposit of Rs. 25 lakhs under Section 35F of the Central Excise Act, 1944 read with Section 83 of the Finance Act, 1994 in respect of the appeal filed by the appellant before him against primary adjudication order dated 14.02.2012 in terms of which service tax demand of Rs. 36,38,492/- for the period 2005-06 to 2009-10 was confirmed alongwith interest and penalties on the ground that the appellant had not paid service tax on erection, commissioning or installation service [Section 65 (105) (zzd)] rendered by it.
2. The appellant has contended that the primary adjudicating authority had not extended the benefit of 67% abatement to which it was clearly entitled. Further, the service rendered did not constitute ECIS and there was no suppression or wilful mis-statement of facts and therefore the extended period was not invocable.
2. We have considered the contentions of the appellant. In view of the judgment of the Honble Supreme Court in the case of Larsen & Toubro Limited holding that works contracts were not liable to service tax prior to 01.07.2006, the demand pertaining to the period upto 31.05.2007 is prima-facie not sustainable. We also observe that rendition of service involved supply of goods and therefore prima-facie the appellant was entitled to the benefit of Notification No. 1/2006-ST or 12/2003-ST. Having regard to these facts and also keeping in view the contention of the appellant about non-invocability of extended period, we are of the view that pre-deposit ordered by Commissioner (Appeals) was on the higher side. Accordingly, we remand the case to the Commissioner (Appeals) to hear the appeal on merit subject to the condition that the appellant makes pre-deposit 10% of the impugned service tax liability and confirm having done so to the Commissioner (Appeals) within thirty days of the receipt of this order. The stay application and the appeal are disposed of in the above terms.
(Justice G. Raghuram)
President
(R. K. Singh)
Member (Technical)
Pant
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