SWATI, CFA Vs. CST

JUDGEMENT

(1.) THIS application seeks waiver of predeposit of an amount of Rs. 1,24,884/ - demanded from M/s. Swati, CFA, being short paid service tax on clearing and forwarding agent's service found to have been rendered by it during the period September, 1999 to March, 2002. The impugned order has been passed revising an order of the jurisdictional Assistant Commissioner dropping proposal to demand the same amount. Initially the appellants had approached the Commissioner (A), and their appeal was allowed by way of remand. In the order they challenged before the Commissioner (A), the demand had been raised on the ground that the appellants had not included the administrative charges and rent collected by it in the taxable value. The Commissioner (A) had remanded the matter to the original authority to verify if the assessee had collected any amount towards administrative charges and rent in excess of what they had actually incurred. The original authority found in remand proceedings that the appellants had not collected any amount in excess of the actuals. The impugned order passed revising the above said order of the original authority, has confirmed the demand on the finding that the charges collected towards rent and administrative charges were not actuals. These amounts had been collected on a flat rate.

(2.) MOVING the application, the Ld. Counsel for the appellants submits that the initial order of the original authority had merged in the order of the Commissioner (A). As the department had not challenged the order of the Commissioner (A), the same had become final. The order of the original authority passed in remand could be revised in the absence of a valid challenge to the order of the Commissioner (A). It is also submitted that in the initial order of the original authority, the proposal to penalize them had been dropped though larger period had been invoked. The demand therefore was barred by limitation.

(3.) AFTER careful consideration of the case records and the submissions by both sides, I find that the original authority had dropped the demand in an order passed following the directions contained in the remand order of the Commissioner (A). As the department had not challenged the said appellate order, prima facie the Commissioner could not have validly passed an order in revision holding a contrary view on the appellant's liability to service tax on certain amount, the Commissioner (A) and the original authority had found not to be includable in the taxable value. In the circumstances, I find that the appellant has made a prima facie case against the impugned demand. Therefore, there shall be waiver of predeposit and stay of recovery of the demand till the final disposal of the appeal.