P. GOVINDARAJ Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) THE appellant was engaged in the business of providing Maintenance and Repair Service in the factory of M/s. Tractor and Farm Equipment Ltd. (TAFE), Kalladipatti, near Madurai. They did not pay appropriate the Service Tax on such service for the period 1 -10 -2004 to 31 -3 -2008 in time. Revenue conducted investigations with TAFE and found that TAFE was making payments to the appellant. Then, Revenue approached appellant in Nov., 2008 for details of Service Tax payment on such consideration received from TAFE. By this time, the appellant had taken out registration under Service Tax regime and started discharging Service Tax from April 2008. However, there was a dispute regarding tax liability pertaining to previous period. Appellant did not pay it immediately because TAFE had not paid Service Tax amount to the appellant. Later the appellant remitted this Service Tax amount of Rs. 5,20,274/ - and interest of Rs. 1,59,598/ - in May 2009. Subsequently, show cause notice dated 23 -4 -2010 for the period 2004 -05 to 2008 -09 covering both the periods i.e. the period for which they were not registered and had not paid tax as also for the period for which they were registered and were paying Service Tax. After adjudication, there is a demand of Rs. 5,71,328/ - confirmed against the appellant along with interest under Section 75 and penalty of Rs. 5000/ - under Section 77 and penalty of Rs. 5,71,328/ - under Section 78. The order also appropriates an amount of Rs. 5,20,274/ - and interest of Rs. 1,59,598/ - paid by the appellant. Therefore, a dispute in this appeal is only to the extent of tax amount of Rs. 51,054/ - and corresponding interest and penalty. Aggrieved by the order of Commissioner (Appeal) confirming the order of adjudicating authority, appellant has filed this appeal before Tribunal.

(2.) LD . advocate submits that this difference is on account of three factors. Firstly the demand is based in income tax return which is prepared on the basis of accrued income but they paid tax on the basis of actual receipts because that was the legal requirement for Service Tax payment. He submits that two bills Nos. 035 and 036 of dated 31 -3 -2009 for a total of Rs. 1,15,630/ - was received only on 2 -5 -2009 in respect of which the appellant had shown an entry dated 2 -5 -2009 for Rs. 1,12,774/ - in their bank statement. The difference is on account of Tax Deducted at Source and canteen bill totalling to Rs. 2856/ -.

(3.) THE third issue is that an amount of Rs. 24,548/ - covered by bill No. 323, dated 29 -3 -2008 and 325, dated 31 -3 -2008 received in the subsequent year was included in the financial year 2008 -09.