M/S Toyota Construction Pvt Ltd vs Commissioners Of Central Excise

[ Arising out of OIO-04/MP/DAMAN/2010 dtd 20.8.2011 Passed by Commissioners of Central Excise, Customs and Service Tax-DAMAN ]

M/s Toyota Construction Pvt Ltd - Appellant(s)

Vs

Commissioners of Central Excise, Customs and Service Tax-DAMAN - Respondent (s)

Represented by :

For Assessee : Shri Willingdon Christian, Learned Advocate For Revenue : Shri J Nagori, Authorised Representative

For approval and signature :

Mr. P.K. Das, Hon'ble Member (Judicial) Mr. P.M. Saleem, Honble Member (Technical)

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 should be released under Rule 27 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

No 3 Whether their Lordships wish to see the fair copy of the Order?

Seen 4 Whether Order is to be circulated to the Departmental authorities?

Yes

CORAM :

Mr. P.K. Das, Hon'ble Member (Judicial) Mr. P.M. Saleem, Honble Member (Technical)

Date of Hearing / Decision : 11/8/2015

ORDER No. A/11214 / 2015 dtd 11/8/2015

Per : Mr.P.K. Das,

The appellants were engaged in the business of commercial and industrial construction. A Show Cause Notice dtd 20.4.2010 was issued proposing demand of Service Tax alongwith interest and to impose penalty for the period from October 2004 to March 2009. By the impugned Order, the Adjudicating Authority confirmed the demand of Service Tax alongwith interest and imposed penalty.

2. After hearing both the sides and on perusal of the records, we find that the Adjudicating Authority confirmed the demand of Service Tax on four issues.

3. The first issue is non-inclusion of cost of the material received from the service receivers in the gross value of the services provided. We find that this issue is no more res integra in view of the decision of the Larger Bench of the Tribunal in the case of M/s Bhayana Builders Pvt Ltd Vs CST, Delhi I  2013(32)STR(49)(Tri.LB) in favour of the assessee. Hence, the demand of Service Tax on this issue cannot be sustained.

4. The second issue is wrong availment of the benefit under the Notification No 12/2003-ST dated 20.6.2003. The third issue is non-payment of Service Tax on the amount received from the customers, but not shown in the ST3 returns. In both the issues, the appellant took a stand in reply to the Show Cause Notice that they are eligible of the benefit under Notifications No 15/2004-ST dtd 10.9.2004 and No 1/2006-ST dated 1.3.2006, which was not considered by the Adjudicating Authority. The Learned Advocate drew the attention of the Bench the relevant portion of the reply to the Show Cause Notice. It is stated by the appellant that to safeguard the financial interest of the appellant, as a matter of precaution or as a matter of conservative policy, raised RA (Running Account) Bills to the customers charging Service Tax without claiming any abatement or other benefit in some cases and not in all cases. It is categorically stated that the fact remains that not a single customer has paid Service Tax at such higher or gross rates, i.e., without benefit of abatement etc. The appellant enclosed the statement with reply, marked Annexure BB giving details of Service Tax charged in the RA in respect of each party and the amount realised towards value of service and Service Tax from the party. The Learned Authorised Representative for Revenue drew the attention of the Bench the relevant portion of the Adjudication Order and submits that the appellant realised the tax on the gross value as revealed from the RA bills.

5. The fourth issue is that Service Tax collected in excess, but not deposited with the Central Government required to be recovered and deposited in the Government account in terms of Section 73A of the Finance Act 1994. The Learned Advocate accepted that they have realised the excess amount from the customers. He fairly submits that they are disputing the quantification of the amount. In this context, the Learned Advocate drew the attention of the Bench to Annexure to reply to the Show Cause Notice.

6. After going through the Adjudication order and the reply to the Show Cause Notice alongwith Annexure, we find that the appellant had took a definite stand before the Adjudicating Authority that they have not collected the entire amount as alleged in the Show Cause Notice from their customers. They have also submitted the Annexures in reply to the show Cause Notice to substantiate their contention. It is noted that the Adjudicating Authority had not given any findings on these issues. In our considered view, the Adjudicating Authority should have examined the Annexures and the submissions in reply to the show Cause Notice in detail before passing the Adjudication Order. He is also required to examine the claim of abatement of the appellant.

7. In view of the above discussion, we set aside the demand of Service Tax alongwith interest and penalty in respect of first issue. We remand the matter to the Adjudicating Authority to decide afresh in respect of the other three issues. Needless to say that the Adjudicating Authority shall give proper opportunity for hearing before passing order. Appeal filed by the appellant is disposed of in the above terms.

(Dictated and pronounced in the Court)

(P.M. Saleem) (P.K. Das) Member (Technical) Member (Judicial)

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