BAJAJ TRAVELS LTD Vs. COMMISSIONER OF SERVICE TAX

JUDGEMENT

(1.) The appellant in both these appeals, filed under Section 35G (3) of the Central Excise Act,1944 read with Section 83 of the Finance Act,1994, is the same company. The challenge is also to the singular judgment dated 19th June, 2006 passed by Customs, Excise and Service Tax Appellate Tribunal (hereinafter referred to as the Tribunal) whereby two appeals of the appellant herein have been decided. Primary, nay, sole grievance of the appellant is against the imposition of penalties. These penalties were the result of two orders dated 19th June, 2009 and 31st January, 2006 passed by the Commissioner of Tax, New Delhi on identical grounds, albeit for varying periods, resulting into two proceedings giving rise to two appeals. Otherwise issues are common in both the appeals which are admitted on the following substantial questions of law:-

(2.) The appellant is engaged in the Air Travel Agent Services having its registered office in Chandigarh and branch offices in Chandigarh and Delhi. The establishment of the appellant is exigible to service tax. The appellant has also been submitting the service tax return and depositing the service tax from time to time.

(3.) On 5thSeptember, 2005, the Head Quarter Preventive Staff of the respondent Department visited the office of the appellant at Chandigarh and scrutinized the record pertaining to ticket booking in relation to air travel. It was found that, prima facie, the value of services declared in ST-3 return was far below the value appearing in the appellant?s records. The Department resumed documents/records as per "Resumption Memo" dated 5 thSeptember, 2005 and a panchnama to that effect was drawn on the spot. The officials also visited the branch office of the appellant at Chandigarh and seized the documents from that office as well. Statements of Sh. Prakash Negi, Sales Executive, Sh. Harminder Singh, Sales Manager, Sh. Kuldeep Singh, Manager (Accounts) and Sh. Mohinder Singh Bajaj Director of the appellant were recorded. Thereafter, show cause dated 17 thOctober, 2005 was issued by the respondent stating that the appellant had rendered air travel agent services to the tune of Rs 2,58,62,84,429/- but had declared to the department in the ST-3 returns only a taxable value of Rs1,30,77,36,056 thereby suppressing a taxable value to the tune of Rs 1,27,85,48,373/- involving short payment of Service Tax amounting to Rs 86,02,849/- and Education Cess Rs 64,029/- for the period April, 2000 to March, 2005 for Branch Office, New Delhi. It was further alleged that the appellant did not depict the exact basic fare figures of tickets sold in their ST-3 returns submitted to the department during the period referred above and that there had been under valuation of the taxable services. On this basis, in the show cause notice, the appellant was asked to show as to why:-