LAWS(CE)-2009-12-149

UNIQUE CABLE NETWORK Vs. CCE

Decided On December 29, 2009
Unique Cable Network Appellant
V/S
CCE Respondents

JUDGEMENT

(1.) The facts leading to this appeal are, in brief, as under:

(2.) THE appellants are multi system Operator who receive the satellite signals from Broadcaster and pass on the signal to the cable operators for which they were charging some amount. The services provided by multisystem operators became taxable for the first time w.e.f. 10.9.04. Prior to 10.9.04 only the service provided by the cable operators was taxable. The appellant had taken service tax registration when the service of multisystem operator became taxable w.e.f. 10.9.04. However instead of paying service tax on the amount being charged by them from the cable operators, the appellant during the period from 10.9.04 to March' 05 were taking credit of the service tax paid by the cable operators and showing that amount as their service tax payment and were filing ST -3 returns enclosing TR -6 challans of the cable operators. In this manner during the period from 10.9.04 to March'05, they took credit amounting to Rs. 2,55,816/ - on the basis of cable operator's challans and showed the service tax payment of this amount by utilising this credit when paying service tax on the amount being charged by them from the cable operators. This irregularity was detected when ST -3 returns for the period from Oct' 04 to March'05 was taken for scrutiny. The appellant paid service tax amount of Rs. 2,55,816/ - in two instalments on 30.10.07 and 26.9.07. A show cause notice was issued for recovery of service tax from the appellant alongwith interest and also imposition of penalty on them under Section 76 of the Finance Act, 1994. The Dy. Commissioner, Central Excise Division III, Kanpur vide order -in -original dt. 24.4.08 disallowed the credit of Rs. 255816/ - and confirmed service tax demand of same amount and also imposed penalty of Rs. 1,000/ - under Section 77 and penalty of Rs. 200/ - per day under Section 76. Since the Dy. Commissioner's order was silent about the interest, the same was taken up for review by the Commissioner under Section 84 of the Finance Act, 1994 and vide order -in -revision No. 02/2008 -09 dt. 7.10.08, the Commissioner confirmed the demand of interest of Rs. 91,606/ - and also imposed penalty of Rs. 100/ - per day for the period upto 17.4.06 and at the rate of Rs. 200/ - per day for the period of failure w.e.f. 18.4.06 till the date of payment of service tax. Since the appellant had paid the interest amount of Rs. 91,606/ - on 22.9.08, the Commissioner also ordered its appropriation. The present appeal has been filed against the Commissioner's order -in -revision challenging the imposition of penalty under Section 76. Heard both sides.

(3.) I have carefully considered the submissions from both the sides and perused the records. There is no dispute about the fact that during the period from 10.9.04 to March'05, the appellant did not pay any service tax on the amount being charged by them from the cable operators and instead of paying service tax on the amount being charged by them from the cable operators, the appellant treated the cable operators as their service providers and took credit of the service tax paid by the cable operators and used this credit for discharging their service tax liability while it should have been the other way round. Though the returns in ST -3 Form were filed by enclosing the TR -6 challans, since there is no system of assessment by the jurisdictional assessing officer, it is responsibility of the assessee to correctly determine the service tax liability and file service tax returns on that basis. There is no satisfactory explanation as to how the appellant had treated the cable operators who were receiving the taxable service from them, as their service providers and took credit of the service tax paid by the cable operators and wrongly utilized the same for discharging their service tax liability. The penalty under Section 76 is attracted whenever there is non payment of service tax by the due date and in this case the appellant during period from 10.9.04 to March'05 did not pay any service tax. The reason given for non -payment of service tax is not convincing. In view of this, I do not find any infirmity in the impugned order. The appeal is dismissed.