Pioneer Services v/s. CCE
Order Nos. A/356/WZB/AHD. OF 2012 & S/464/WZB/AHD OF 2012
Application No. ST/S/640 OF 2011
Appeal No. ST/322 OF 2011
March 21, 2012
M.V. Ravindran, Judicail Member – This Stay Petition is filed for waiver of Service Tax of Rs. 40,79,590/-, interest thereof and equivalent amount of penalty. Besides, interest of Rs. 4,483/- for delayed payment, and penalty of Rs. 5,000/- under Section 77 have also been imposed.
2. The above said amounts have been confirmed by the adjudicating authority and upheld by first appellate authority as Service Tax liability on the ground that they have been providing Business Auxiliary Service.
3. After hearing both sides for some time on the Stay Petition, we find that the appeal itself can be disposed at this juncture, as it lies in a narrow compass. In view of this, we allow the application for waiver of pre-deposit of amounts involved and take up the appeal for disposal.
4. Ld. counsel would take us through the order-in-original, order-in-appeal and the Show Cause Notice. It is his submission that the Show Cause Notice seeks to demand Service Tax under the category of Business Auxiliary Service, while according to the functions which they are supposed to carry out by virtue of contract with various clients, is amounting to the services rendered by recovery agent and at the most under business support services. It is his submission that they have produced a Chartered Accountant’s certificate giving various details before lower authorities to indicate that the entire amount as indicated in the balance sheet as an income has not come from the services rendered by them but could be loan and other income. It is his submission that both the lower authorities have not considered these submissions in proper perspective.
5. Ld. SDR, on the other hand, submits that the appellants themselves have indicated before the lower authorities that they are engaged by banks to verify the antecedents of the peoples who are applying for the loans and they are covered under Business Auxiliary Service, as the appellants themselves taken Service Tax registration under the said category. It is his submission during the entire proceedings before the lower authorities, the liability of the appellant under various heads was never agitted, and this is first time, the issue was taken up.
6. On careful consideration of the submissions made by both sides, we find that the appellant’s claim that they have produced some records and the documents, indicating that the income mentioned in the balance sheet may not be totally out of the income as a recovery agent is borne out from the Chartered Accountant’s certificate and adjudicating authority has recorded the same in the submissions made by assessee. It is also seen that the adjudicating authority has recorded that the appellant has produced a Chartered Accountant’s certificate. Suffice to say that the adjudicating authority should have given a finding on this issue, we are of the view that the entire issue needs to be re-considered by lower authority. We also find that the issue involved in this case also needs to be appreciated from the factual matrix, as regards the receipts indicated in the balance sheet of the appellant and the certificate issued by Chartered Accountant to that extent. It our opinion, this exercise is better left to the adjudicating authority to appreciate all the evidences available and that may be produced by the appellant.
7. Accordingly, in view of the foregoing, without expressing any opinion on the merits of the case and keeping all the issues open, we set aside the impugned order and remit the matter back to adjudicating authority, to re-consider the issue afresh, after following the principles of natural justice.