One crore Service Tax case lost because Order is beyond the scope of SCN
HASTE makes waste is an age-old proverb.
What better example than the present case to explain this.
Proceedings were initiated against the appellant by issuing three SCNs on the ground that the applicants are provider of Stock Broker Services and certain charges are not added to the assessable value of the service as stock broker.
The Commissioner of Service Tax, Mumbai brushed aside all the submissions made by the service provider and confirmed the total demand of Service Tax of Rs.1.04 Crores made in the three SCNs along with penalties and interest on the ground that they have provided Stock Exchange Services.
Noticed something amiss in the order?
Yes, you are right - the adjudicating authority confirmed the demand by holding that the appellant provided “Stock Exchange Services” whereas the SCNs wanted it under the head “Stock Broker Services”.
Before the CESTAT, the appellant had nothing much to argue but highlight this “blunder”.
And the Bench held -
"8. As the show-cause notices were issued demanding duty as provider of Stock Broking Services, whereas the adjudicating authority has confirmed the demand as provider of Stock Exchange Service, which is a different and distinct service. In these circumstances, we find merit in the contention of the appellant that the impugned order is beyond the scope of show-cause notice.
9. In view of this, the impugned order is set aside after waiving the requirement of pre-deposit of dues and the appeal is allowed. Stay petition is also disposed of accordingly."
One crore plus of Revenue down the drain…well, almost!
By the way, has the Revenue filed any appeal against this “intriguing” order of the Commissioner at the behest of the Committee of Chief Commissioners?
We will find out in the days to come.
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