Prayer of Appellant to recover the ST in instalments turned down by adjudicating authority - since order has not been passed u/s 73 of FA, 1994, appeal not maintainable before CESTAT
VIDE an order-in-original V/ST/HQ/AE/Inq/Gr.X/79/M-II/2012 dated 27.02.2013, the Commissioner of Service Tax, Mumbai II inter alia held thus:-
“10. Collecting service tax but not depositing the same to the Government is an intentional act of evasion of Service Tax and causes not only loss of revenue to the government but also a serious offence. M/s Spanco BPO Service Ltd. defaulted payment of service tax of Rs.26.90 crore for the period April 2011 to January, 2013 not filed periodical ST-3 returns and suppressed the material facts. The assessee is required to pay the service tax along with interest and also penalty. Persons responsible for committing the offence are also liable for prosecution under section 89 of the Finance Act, 1994.
11. Considering the facts and circumstances of the case and the material evidences of record, I am unable to consider favourably the requests of M/s Spanco BPO Service Ltd., Navi Mumbai to allow them to pay the amount of Rs.26.90 crore due in 36 equal monthly installments and to withdraw the recovery proceedings initiated under section 87. The assessee is advised to pay the service tax due along with applicable rate of interest forthwith.”
The appellant is in appeal before the CESTAT against this order.
The Revenue representative raised a preliminary objection regarding the maintainability of the appeal inasmuch as it is submitted that since the impugned order has been passed u/s 87 of the Finance Act, 1994, therefore, the appeal does not lie before the Tribunal.
The appellant drew the attention of the Bench to paragraph 10 and submitted that the appeal is maintainable as this type of order can only be passed under section 73 of the Finance Act, 1994 and proceedings under section 87 can be initiated only under section 73 of the Act.
More arguments were made justifying their appeal by narrating the facts involved and which were that the appellant was issued a letter on 19.02.2013 pursuant to the audit conducted on their ST-3 returns asking them to deposit the short payment of service tax along with interest and on receipt of which they made a request to provide a facility of paying the said amount in installments as per Board's Circular no. 289/50/97-CX.9 dated 17.11.1997 and in response to which the impugned order was passed by the Commissioner.
The Revenue representative submitted that the appellant had not preferred an appeal against the letter dated 19.02.2013.
The Bench after extracting the provisions of sections 73 and 86 of the FA, 1994 observed -
"10. We have perused the impugned orders. In the impugned order there is no dispute about the confirmation of service tax demand. The only dispute is regarding the recovery proceedings of the amount demanded by the learned Commissioner and the grievance of the appellant only is that he has not considered their applications for payment in installments due to financial hardships. The appellant's prayer to recover the proceedings in installments has been turned down by the adjudicating authority.
11. In these situation, we observe that the impugned order has not passed under Section 73 ibid. Therefore, the appeal is not maintainable before this Tribunal. The appellant is at liberty to recourse their action before the learned Commissioner for appropriate action."
The appeal as well the stay application was disposed of.