Commissioner of Service Tax, Chennai [sought to be changed as CGST & Central Excise, Chennai South Commissionerate Chennai] Versus Vasanth & Co.
Service Tax
2018 (7) TMI 1220 – CESTAT CHENNAI – TMI
CESTAT CHENNAI – AT
Dated:- 18-7-2018
Application No. ST\/Misc [CT]\/41475\/2017 & Appeal No. ST\/524\/2011 – Final Order No. 42030 \/ 2018
Service Tax
Hon'ble Ms. Sulekha Beevi, C.S., Member ( Judicial ) And Hon'ble Shri Madhu Mohan Damodhar, Member ( Technical )
\nShri B. Balamurugan, AC (AR) For the Appellant
\nShri K. A. Parthasarathy, Advocate For the Respondent
\nORDER
\nPer Bench
\nThe facts of the case are that M\/s.Vasanth & Co., the respondents herein, are engaged in the business of trading in consumer durables like TV, Refrigerators, Washing Machines etc. in the show rooms. Pursuant to investigations carried out by the Directorate General of Central Excise Intelligence (DGCEI), it appeared that respondents had tie up with various financial institutions like GE Countrywide<\/p>\n
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Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ority by an order dt. 08.09.2010 confirmed the proposals regarding tax demand in the SCN with interest, and also imposed penalties of Rs. 2000\/- under Section 77 and equal penalty of Rs. 35,23,936\/- under section 78 ibid. In appeal, the Commissioner (Appeals) vide impugned order dt. 17.06.2011, the Commissioner (Appeals) set aside the order of original authority and allowed the appeal. Aggrieved, Revenue is before this forum. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n siness Auxiliary Service'. Being an restricted activity, the Tribunal also held that for concluding that BAS has been provided, the transactional documents and other evidence on record should indicate the substantial activities falling within the contours of any of the integers of the definition of “Business Auxiliary Service'. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n nal authority was passed on 08.10.2010 and the impugned order of lower appellate authority was passed on 17.6.2011. Discernably, the lower authorities would obviously not have had the benefit of Larger Bench decision of the Tribunal Pagariya Auto Center Vs CCE Aurangabad – 2014 (33) STR 506 (Tri.-LB) which was passed only on 12.09.2013. In fact, the SCN has largely relied upon the single statement of Shri S. Jeyaraj, Accounts Manager of respondent to support the allegations made therein. There is no reference to any agreements or communications between the respondents and the financial institutions made in the body of the SCN. However, in the list of relied upon documents supplied along with SCN a reference has been made to sample copies of communications with ICICI Bank and GE Countrywide (Annexure-II) and also to worksheets containing details of payments received towards commission by respondents (Annexure-III). All the same, both the lower authorities have not done any analysis of t<\/p>\n = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n or financial institution would per se amount to BAS. The identification of the transaction and its appropriate classification as the taxable BAS or otherwise must clearly depend upon a careful analysis of the relevant transactional documents. Only such scrutiny and analysis would ensure rational classification of the transaction. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ustice require that the matter should be remanded for de novo consideration by the original authority to apply the tests laid down by the Larger Bench of the Tribunal in Pagariya Auto Center Vs CCE Aurangabad (supra) as discussed above. So ordered. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n es imposed under Sections 76, 77 and 78, we find that as per our above discussion on limitation, there is bona fide belief of the appellant for non payment of service tax, the appellant has been able to reasonable cause for invocation of Section 80. We are therefore of the view that considering the facts and circumstances as well as discussion made herein above with regard to the demand being time bar penalties under Sections 76, 77 and 78 require to be set aside invoking Section 80. As result we pass following order : = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n","protected":false},"excerpt":{"rendered":" Commissioner of Service Tax, Chennai [sought to be changed as CGST & Central Excise, Chennai South Commissionerate Chennai] Versus Vasanth & Co.Service Tax2018 (7) TMI 1220 – CESTAT CHENNAI – TMICESTAT CHENNAI – ATDated:- 18-7-2018Application No. ST\/Misc [CT]\/41475\/2017 & Appeal No. ST\/524\/2011 – Final Order No. 42030 \/ 2018Service TaxHon'ble Ms. Sulekha Beevi, C.S., Member … Continue reading “Commissioner of Service Tax, Chennai [sought to be changed as CGST & Central Excise, Chennai South Commissionerate Chennai] Versus Vasanth & Co.”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-12701","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/12701","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=12701"}],"version-history":[{"count":0,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/12701\/revisions"}],"wp:attachment":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=12701"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=12701"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=12701"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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\n2. Today when the matter came up for hearing, on behalf of the Revenue Ld. A.R Shri B. Balamurugan reiterates the grounds of appeal and also made the following submissions :
\n i) The issue in question has been decided against the respondents in the Larger Bench of the Tribunal decision in Pagariya Auto Center Vs CCE Aurangabad – 2014 (33) STR 506 (Tri.-LB).
\n ii) The customers of respondents were directed to approach only such banks \/ financial institutions who have tie up with them and not to others.
\n iii) The representative of income by financial institutions <\/p>\n
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\nii) However, in the instant case, no transactional documents have been relied upon by the original authority as well as by Commissioner (Appeals) and only statement of Shri S. Jeyaraj, Accounts Manager has been relied upon.
\niii) All that the respondents did was to direct prospective customers to representatives of banks \/ financial institutions operated from the place of business of the respondents.
\niv) The Department has sought various particulars on 1.10.2007 to which they had given reply on 10.10.2007 along with copies of General Ledger for the years 2003-04, 2004-05 and 2005-06. Further in response to summons dt. 15.11.2007 they had submitted a letter dt.<\/p>\n
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\n 21. Where mere space is provided along with furniture for facilitating accommodation of representatives of financial institutions in the premises of an automobile dealer and consideration is received for that singular activity, such consideration may perhaps constitute a rent for the provision of space and associated amenities. Such restricted relationship\/transaction may not amount to BAS. If on the other hand, the transactional documents and other evidence on record indicates a substantial activity falling within the contours of any of the integers of the definition of BAS, spelt out in Section 65(19), then it would be legitimate to conclude that BAS is <\/p>\n
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\n8. At the same time, we find merit in the alternative contention of the Ld. Advocate that in a number of Tribunal decisions, which have applied the ratio laid down by Larger Bench in Pagariya Auto Center (supra), have consistently set aside penalties even while upholding the tax liability with interest. We find that this is the ratio adopted by the Tribunal in Sharya Motors Vs CST Mumbai – 2016 (43) STR 158 (Tri.-Mumbai) where it has been held as follows :
\n “6. In short, the appeal is disposed of by upholding the tax liability with interest, under the Business Auxiliary Services for commission received from the financial institution, while the tax demand on amount received as target incentive is set aside. Interest liability on the tax con<\/p>\n
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\n (a) Demand from July, 2003 to March, 2005 in respect of Business Auxiliary Services (service relate to HDFC bank) is set aside being time bar.
\n (b) Service tax demand for April and May-2005 require to be re-quantified as per our above discussion by the Adjudicating Authority.
\n (c) As regard the demand of Rs. 1,42,114\/- relates to Business Auxiliary Service (Commission on sale of car) require to be re-considered applying the Notification No. 14\/2004-S.T. by the Adj<\/p>\n
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