State Bank of India Vs C.C. E. & S.T.–Surat (CESTAT Ahmedabad)
find that the services provided by the appellant are in relation to the disbursement of EPF and ESI. Notification No. 13/2004-ST dated 10.09.2004 provides following exemption:
“…. exempts taxable service provided by a banking company or a financial institution including a non-banking financial company, or any other body corporate or commercial concern, to the government of India or the Government of a State from the whole of the service tax leviable thereon under Section 66 of the said Act.”
It is seen that the exemption granted by the aforesaid Notification relates to collection of taxes. EPF and ESI are not taxes by any stretch of imagination. In this regard, the benefit of Notification No. 13/2004-ST dated 10.09.2004 cannot be granted.
We also find that the language of the Notification is very clear and there is no scope of confusion between the EPF / ESI scheme with taxes collected by Government. Therefore, non inclusion of the Commission and claim of exemption under Notification 13/2004 is clearly an attempt to evade the taxes.
FULL TEXT OF THE CESTAT AHMEDABAD ORDER
This appeal has been filed by State Bank of India against demand of service tax and imposition of penalties under Section 77 and 78 of the Finance Act, 1994.
2. Learned Counsel appearing for the appellant pointed out that appellant was providing various banking and financial services on which they were paying taxes. They were however not paying any tax on the Commission amount received on account of operation of EPF/ESI account. Demand of service tax on the Commission amount received under this head was raised and confirmed by the lower authorities. The order-in-original imposed penalties under Section 76, 77 and 78. However the impugned order allowed them the relief in respect of penalty under Section 76. The appellants are seeking waiver of penalty on the ground that the service provided by them was entitled to exemption under Notification No. 13/2004 dated 10.09.2004. It was argued that the said notification exempts taxable service provided by a banking company or a financial institution including a non-banking financial company, or any other body corporate or commercial concern, to the government of India or the Government of a State.
2.1 It was argued that the issue is not beyond doubt and therefore, invocation of extended period of limitation is also improper.
2.2 Learned Counsel relied on the decision of Tribunal in the case of Canara Bank vide Order No. A/723/WZB/AHD/2012 dated 29.08.2012.
2.3 On the issue of limitation the appellant relied on the following decisions:
