SERVICE TAX TODAY
|
Vol. 13, Part 3, for the week of March 21 –
March 27, 2008
|
statutes
q central excise
u Rule 9 of the Central Excise Rules, 2002 - Registration - Amendment in Notification
No. 35/2001 - Central Excise (N.T.), dated 26-6-2001 - Conditions, safeguards
and procedures for registration of a person under Central Excise (No. 2) Rules,
2001 and exemptions from registration in specified cases - NOTIFICATION NO. 16/2008 - CENTRAL EXCISE
(N.T.), DATED 4-3-2008
q service tax
Circular
u Section 83A of the Finance Act, 1994 - Power of
adjudication - Amendment to Circular No. 97/8/2007-ST, dated 23-8-2007 - circular no.
99/2/2008-st, dated 11-3-2008
u Section 73D of the Finance Act, 1994 -
Publication of information in respect of persons in certain cases - Guidelines
in respect of publication of names under section 73D - circular no.
100/3/2008-st, dated 12-3-2008
Notification
u Section 83A of the Finance Act, 1994 - Power of adjudication - Amendment
in Notification No. 30/2005 - Service Tax, dated 10-8-2005 - notification no.
16/2008-service tax, dated 11-3-2008
Trade Notice
u Clarification on Service Tax of Freight Charges - trade notice no. 5/2008/service tax no.
2/2008 dated 5-2-2008
Magazine
finance
bill, 2008
q Guide to Amendment introduced by Finance Bill,
2008 and Notification issued on 1st March 2008
q New Cenvat Credit
Rule 6(3) and 6(3A) - A Pandora’s Box//V.S. Datey
q Service Tax Dispute Resolution Scheme - A
cleansing device//Ajay Kumar Garg
q Service tax on sub-consultants/sub-contractors
proposed changes under Budget 2008//Hariom Jindal
q Budget 2008-09 - Service tax proposals//Prasanth Srinvas
q Finance Minister travels far ahead towards -
Goods and service tax//V. Gangadharan
q Service tax - An illusion like water of
q Service Tax Dispute Resolution Scheme, 2008 -
An assessee-friendly measure//Ashhok Saxena
Reports
table of cases
CCE
v. Bajaj Auto Ltd. (Mum. - CESTAT)
CCE v.
CCE v.
Sri Akkammal Steels (P.) Ltd. (Chennai - CESTAT)
Kerala Transport
Development Finance v. CCE (Bang. - CESTAT)
Ramakrishna Reddy (M.)
v. CCE&C (Bang. - CESTAT)
Sugumar (P.) v. CCE (Chennai - CESTAT)
Venkatraman Associates v. CST (Bang. -
CESTAT)
Subject Index
Banking
and other financial services
- Service tax under category of ‘Banking and
other financial services’ was demanded from assessees
for period prior to 10-9-2004 on ground that it was carrying on hire purchase
business - However, assessees relying on opinion of
retired Supreme Court Judge who on examination of entire agreement opined that
assessee was not doing hire purchase business but was doing only ‘lending
business’ and was not covered under ‘Banking and other financial services’
prior to 10-9-2004, prayed for waiver of pre-deposit - Whether in view of
opinion given by retired Supreme Court Judge and in terms of agreement in
question, there was prima facie case that assessees
were not carrying on activity of banking and other financial services and they
were only undertaking lender and borrower services in terms of decision in Bajaj Auto Finance v. CCE [2007] 6 STT
322 (Mum. - CESTAT) and, therefore, stay application was to be allowed granting
waiver of pre-deposit requirement - Held, yes - Kerala Transport
Development Finance v. CCE (Bang. - CESTAT)
Cenvat
Credit Rules, 2004
Cenvat credit
General
- Assessee availed Cenvat
credit on capital goods which were procured by it - It had also claimed
depreciation on amount of Cenvat credit availed by it
from income-tax authorities - Subsequently, assessee filed revised income-tax
return by reducing claim to extent of credit availed on capital goods -
Revenue, however, disallowed Cenvat credit on ground
that respondent was not eligible to avail credit of amount of excise duty as it
had initially claimed depreciation under Income-tax Act on said amount -
Commissioner (Appeals) held that credit so availed was admissible to assessee
as it had filed revised return with Income-tax department reducing claim to
extent of credit availed on capital goods - Whether Commissioner (Appeals) was
justified - Held, yes - CCE v. Bajaj
Auto Ltd. (Mum. - CESTAT)
Cenvat
Credit Rules, 2004
- Rule 3
Finance
Act, 1994
- Section 65
- Section 80
- Section 84
Penalty
Not to be imposed
in certain cases
- Assessee was engaged in providing services of
mandap keeper - Revenue found that it had suppressed
value of taxable service rendered by it by way of issuing bills of lesser
amount and not recording all functions held by it in its resorts - Adjudicating
authority, accordingly demanded service tax and penalty of amount equal to
amount of service tax evaded was imposed under section 76, and further penalty
equal to twice amount of service tax evaded was imposed under section 78 on
assessee - Whether in cases involving suppression and fraudulent behaviour, there cannot be any reasonable cause for waiving
penalty by resorting to section 80 - Held, yes - Whether in instant case
there was any valid reason for setting aside penalties by resorting to section
80 - Held, no - Whether, however, since both penalties imposed together
appeared somewhat harsh, penalty imposed under section 78 was to be reduced to
amount equal to service tax evaded and no separate penalty was warranted under
section 76 in view of penalty imposed under section 78 - Held, yes - CCE
v. Silver Oak Gardens Resort (New Delhi - CESTAT)
Rent-a-cab
scheme operator
- Assessee had entered into an agreement with
BSNL to provide vehicles along with drivers for transport of officials employed
with BSNL for their tours - Service tax was demanded from assessee under
category of ‘Rent-a-cab scheme operator’ - Whether since a view could prima
facie be taken that assessee’s case did not
attract service tax as rent a cab-operator, assessee had a prima facie
case against demand and, therefore, there would be waiver of requirement
pre-deposit of tax demanded and stay of recovery of same - Held, yes - P.
Sugumar v. CCE (Chennai - CESTAT)
Revision
by Commissioner
- Period from 2001 to December 2004 - Whether Commissioner
is empowered to enhance penalty by exercising his powers under section 84 - Held,
yes - Assessee-firm was providing services as architects - On investigation,
revenue officers found that assessee had short paid service tax for period in
dispute - Adjudicating authority taking a lenient view imposed penalty of Rs. 20,000 on assessee under section 78 - Commissioner
invoking section 84 reviewed said order and enhanced penalty imposed under
section 78 to Rs. 90 lakh -
Whether Commissioner was perfectly justified in exercising revisional
powers under section 84 in respect of order of imposing penalty of only Rs. 20,000, when minimum prescribed penalty under section
78, as it then stood, could not have been less than amount of service tax
sought to be evaded and could have been imposed up to twice amount of service
tax sought to be evaded - Held, yes - Whether since it was found that
service tax was collected but not paid, as and when due, nor returns were
filed, it was a proper case for enhancing penalty under section 78 - Held,
yes - Whether, however, having regard to facts and circumstances of case
assessee was to be directed to pre-deposit part of penalty amount - Held,
yes - Venkatraman Associates v. CST
(Bang. - CESTAT)
Site
formation and clearance, excavation and earthmoving and demolition service
- Assessee had been awarded with work of mining
Barytes Ore by ‘A’ - Service tax was demanded from
him under category of ‘Site formation and clearance, excavation and earthmoving
and demolition services’ - Assessee contended that services rendered by him
would come within category of ‘Mining services’ which came into taxing net only
in year 2007 and no service tax could be demanded for prior period - However,
revenue contended that work of excavation and removal of ore, undertaken by
assessee would squarely fall within definition of ‘Site formation and
clearance, excavation and earthmoving and demolition service’ - All relevant
documents were not available to take a decision that services rendered by assessee
would not come within “site formation and clearance excavation and earthmoving
and demolition services” - Whether in such circumstances, it could be said that
assessee had not made out prima facie a strong case on merits and,
therefore, it was to be directed to pre-deposit part of demand and on such
deposit further recovery was to be stayed - Held, yes - M.
Ramakrishna Reddy v. CCE&C (Bang. - CESTAT)
Transport
of goods by road service
- Period from 16-11-1997 to 1-6-1998 - Original authority demanded service tax from assessee on goods transport operator’s service availed by it during relevant period by invoking section 73(a) - Commissioner (Appeals) having found that issue involved had been settled against revenue by Tribunal vide its decision in L.H. Sugar Factories Ltd. v. CCE 2004 (165) ELT 365, which had been affirmed by Supreme Court in CCE v. L.H. Sugar Factories Ltd. [2005] 2 STT 282, vacated demand raised - Whether Commissioner (Appeals) was justified - Held, yes - CCE v. Sri Akkammal Steels (P.) Ltd. (Chennai - CESTAT)