M/S.Paharpur Cooling Towers Ltd vs Commissioner Of Service Tax, Kolkata

(Arising out of Order-in-Original No.73/Commr/ST/Kol/2012-13 dated 12.03.2013 passed by the Commissioner of Service Tax, Kolkata.)

FOR APPROVAL AND SIGNATURE

HONBLE DR. D.M.MISRA, MEMBER(JUDICIAL) HONBLE DR.I.P.LAL, MEMBER(TECHNICAL)

1. Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2. Whether it should be released under Rule 27 of the CESTAT(Procedure) Rules, 1982 for publication in any Authorative report or not?

3. Whether Their Lordship wishes to see the fair copy of the Order?

4. Whether Order is to be circulated to the Departmental Authorities?

M/s.Paharpur Cooling Towers Ltd. Applicant (s)/Appellant (s) Vs.

Commissioner of Service Tax, Kolkata Respondent (s)

Appearance:

Shri Hemant Jajodia, CA for the Appellant(s) Shri S.P.Pal, Appraiser(AR) for the Revenue

CORAM:

Honble Dr. D.M.Misra, Member(Judicial) Honble Dr.I.P.Lal, Member(Technical)

Date of Hearing :- 15.07.2015 Date of Pronouncement :- 15.07.2015

ORDER NO.FO/A/75385/2015

Per Dr. D.M.Misra.

1. This is an Application seeking waiver of pre-deposit of duty of Rs.1.79 Crores and equal amount of penalty imposed under Section 78 and penalty of Rs.10,000/- under Section 77 of the Finance Act, 1994.

2. At the outset Shri Hemant Jajodia, ld.CA for the applicant submits that during the period December, 2006 to December, 2010, the applicant rendered services under the taxable category of Commercial or Industrial Construction Services to M/s.SEPCO Electrical Power Construction Corporation Project. The applicant are having centralized service tax registration at Kolkata. The demand has been confirmed against them on the ground that they failed to discharge Service Tax in rendering services to M/s.SEPCO, Jharsuguda against gross taxable value of Rs.20,99,39,507/- received during the said period. The ld.Chartered Accountant submits that they have discharged Service Tax on the services rendered and information was duly disclosed to the Office of Superintendent of Central Excise and Customs, Hirakund in their ST-3 returns filed during the period October, 2006 to March, 2007. After change in the PAN based registration number, the detail of service tax including cess discharged was also duly disclosed in their ST returns filed for the period April, 2007 till September, 2009. Therefore there is no short payment of service tax and the demand is bad in law. The ld.Chartered Accountant fairly accepted that neither they filed reply to the show cause notice in spite of sufficient time being given to them nor availed the opportunity of personal hearing allowed to them time and again by the adjudicating authority. He submits that in the event they would be given an opportunity to explain their position, the applicant could substantiate their claim of payment of service tax against the aforesaid receipts. At this stage he makes an offer to deposit Rs.13.50 Lakhs and prays that the matter may be remanded to the ld.Commissioner for decision on merit afresh.

3. Per contra the ld.AR for the Revenue reiterated the findings of the ld.Commissioner. He submits that the Applicant neither filed reply to the show cause notice nor appeared before the adjudicating authority to rebut the allegation labeled in the show cause notice. However, he has no objection in remanding the case to the adjudicating authority.

4. After hearing both sides for some time we find that the appeal itself could be disposed of at this stage. Accordingly after waiving the requirement of pre-deposit we take up the appeal for disposal with the consent of both sides.

5. We find that the appellant had neither filed reply to the show cause notice nor appeared for personal hearing before the adjudicating authority in spite of sufficient opportunities had been accorded to them. The claim of the appellant before us is that the confirmation of demand for receiving the taxable value against services rendered to M/s.SEPCO is incorrect as during the relevant period they have already paid appropriate service tax against receipt of the taxable value and disclosed in their periodical ST-3 returns filed with the jurisdictional Superintendent of Service Tax. In the interest of justice, we are of the view that the appellant be given a fair chance to establish the said claim. Accordingly the offer to deposit Rs.13.50 Lakhs, at this stage, seems to be reasonable. Consequently, the appellant is directed to deposit Rs.13.50 Lakhs within a period of eight weeks from the communication of this order and report compliance directly to the ld.Commissioner. After recording compliance, the ld.Commissioner would decide the issue afresh on merit. The appellant is at liberty to file reply to the show cause notice and evidences in support of their claim. All issues are kept open. Needless to mention a reasonable opportunity of hearing be granted the appellant. Appeal allowed by way of remand. Stay petition disposed of.

(Operative part of the order was pronounced in the open court.)

SD/ SD/

(I.P.LAL) (D.M.MISRA) MEMBER(TECHNICAL) MEMBER(JUDICIAL) sm

4 Appeal No.ST-71487/13