1. This appeal is directed against order-in-appeal dated 06-10-05 which upheld the Order-in-Original imposing penalty and demanding interest from the appellant.
2. The relevant facts that arise for consideration are appellant were receiving services from goods transport operators during the period 16-11-97 to 2-6-1998 and did not discharge the Service Tax payable. The appellant discharged the Service Tax liability on 5-2-2004 and 12-2-2004. The revenue issue show cause notice to the appellant on 16-11-04 demanding interest on the Service Tax due and sought to impose penalty on the appellants. On adjudication, the adjudicating authority confirmed the interest payable and also imposed penalty on the appellant. Hence, this appeal.
4. Heard the learned DR and perused records. I find from the record that the appellants have discharged the Service Tax liability before the issuance of show-cause notice. The Service Tax liability has arisen for the receipt of services by the appellant from goods transport operators. An identical issue came up before the Tribunal in the case of Green Ply Industries Pvt. Ltd., in which case vide its Final Order No. 626/06-SM (BR), dated 22-2-06 in the Tribunal held as under: A plain reading of Section 158 would reveal that provisions were inserted to Section 68, in order to bring the category of receiver of the services of G.T.O. as the person liable to pay service tax.
It can be seen that till this retrospective amendment the payment of service tax under Section 68 was to be made only by the service provider. After the retrospective amendment in Finance Act, 2003, the receiver of the services from G.T.O. was also made liable to pay service tax. Since the calculation of service tax liability would have been a bone of contention, the Finance Act, 2003, sought to insert a new Section 71A to make the receiver of services of G.T.O. to file returns. This insertion was necessitated as the provisions of Sections 69 and 70 of Finance Act, 1994 applied only to service provider. By inserting Section 71A, the Finance Act, 2003 made the service receivers to file return to the authorities to ascertain the service tax liability. The said Section 71A also granted time of six months from the date of assent of the Bill by the President.
The Finance Bill, 2003 received the assent of the President on 16-05-2003. This would imply that the service receivers, were required to file the returns by 17-11-2003 and discharge their service tax liability. It can be seen that by bringing this Section 71A in the statute, the liability to discharge the service tax was extended up to 17-11-2003. In other words, if an assessee does not pay his service tax liability by 17-11-2003, the interest liability gets fastened on to the assessee till the payment of service tax.
5. The ratio as laid down in the Green Ply Industries (supra) case, is squarely applicable in this case before me. Following the above decision, impugned order as much it applies to the penalty imposed on the appellant is liable to be struck down, and I do so. As regards the interest part, the appellants are required to pay the interest from 29-11-2003 to 5-2-04 and 12-2-04, as the case may be.
6. Accordingly, the appellant's appeal is allowed partly as indicated in the above paragraph.