KATNI MINERALS (P) LTD. Vs. CC & CE

JUDGEMENT

(1.) M/s. Katni Minerals Ltd. have filed this Appeal against the Order -in -Review No. 18/ST/Commr/2001 dated 24.12.2001 by which the Commissioner of Customs and Central Excise in exercise of powers under Section 84 of the Finance Act, 1994 has confirmed the demand of Sales Tax and imposed penalty.

(2.) We heard Shri B.L Narsimhan, learned Advocate for the appellants, and Shri Vikas Kumar, Ld. Senior Departmental Representative for the Revenue. The learned Advocate submitted that initially a show cause notice dated 29.3.98 was issued to them to show cause as to why the penalty should not be imposed upon them under the Provisions of Section 77 of the Finance Act, 1994 for not filing of the Service Tax returns; that the Deputy Commissioner under Adjudication Order No. 18/99 dated 27.12.99 dropped the proceedings against them in terms of the judgment in Laghu Udyog Bharti v. Union of India, 1999 (65) ECC 687 (SC) : 1999 (33) RLT 911 (SC) under which the Supreme Court had struck down the provisions relating to imposition of Service Tax on services of goods transport operators by holding the provisions of Sub -rule (xii) and (xvii) of Rule 2(1 )(d) Service Tax Rules as ultra vires; that Clause 117 of Finance Act, 2000 validated said sub -clauses with retrospective effect; that the Commissioner, thereafter reviewed the Adjudication Order No. 18/99 passed by the Deputy Commissioner and issued fresh notice dated 4.6.2001 demanding Service Tax. The learned Advocate, further submitted that the power of revision can be exercised by the Commissioner only with regard to proceedings which were initiated by officers subordinate to him; that the only issue taken up by the Deputy Commissioner, under Section 77 of the Finance Act, 1944 was for not filing the returns and there was no proposal in the said show cause notice for levy of Service Tax; that as such there was no adjudication on these issues by the Deputy Commissioner and accordingly these issues cannot be taken up in revision. Learned Advocate also mentioned that this issue stands decided by the Tribunal's decision in the case of Markfed Oil and Allied Industries v. Commissioner of Central Excise, Chandigarh,2002 (84) ECC 860 (T) : 2002 (53) RLT 276 (CEGAT).

(3.) Countering the arguments., Shri Vikas Kumar, learned Senior Departmental Representative, submitted that the show cause notice dated 29.3.98 was issued as the Appellants had failed to furnish quarterly return in the prescribed form ST 3; that the Service Tax assessment can be completed only after filing of the ST 3 returns and as such the present Order is not beyond the show cause notice dated 29.3.98 inasmuch as unless and until the return is filed, there is nothing available with the Department to verify the services'' rendered on which the Service Tax could be assessed.