Zila Sainik Board Vs Commissioner of Central Excise and ST (CESTAT Chandigarh)
Summary: The present appeals arise from different impugned orders concerning the taxability of services provided by M/s Zila Sainik Board, Amritsar. Since the issue involved was identical, Appeal No. ST/50239/2015 was taken as the lead case. In the lead appeal, the Commissioner (Appeals) had confirmed the service tax demand with interest but dropped penalties under Sections 76, 77 and 78 of the Finance Act on the ground that the appellant was under a bona fide belief that it was performing a statutory function and was not liable to service tax, extending the benefit of Section 80.
The dispute arose during audit of M/s. Punjab and Sind Bank, Zonal Office (Urban), Hall Bazar, Amritsar. The bank had taken security services from the appellant during 2006-07 to 2010-11 and paid Rs. 1,37,95,615/- for the services, involving service tax of Rs. 15,47,643/-. The appellant had neither obtained service tax registration nor paid service tax. The show cause notice dated 20.10.2011 proposed recovery of Rs. 15,47,643/- with interest under Sections 73(1) and 75, along with penalties under Sections 76, 77 and 78. The adjudicating authority confirmed the demand with interest and imposed the penalties. The Commissioner (Appeals) partly allowed the appeal by dropping the penalties.
