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Judgment
R. Banumathi, J.—Whether Customs, Excise and Service Tax Appellate Tribunal (for short ""CESTAT"") was right in holding that appeal was
not filed within the prescribed period is the point falling for consideration in this appeal. Assessee has filed this appeal raising the following
questions of law:-
Whether Tribunal is correct in dismissing the appeal filed by the appellant without going into the merits of the case?
Whether the Tribunal is correct in holding that the appeal filed by the appellant before Hon''ble Commissioner (Appeals) is not filed within the
prescribed time without considering the evidences produced by the appellant for having filed the appeal in time but before wrong forum?
Whether the reimbursement are subjected to the levy of service tax prior to 19.04.2006?
Whether the demand of service tax confirmed against the appellant covering the period from April 2003 to March 2006 in terms of Section 67
of Finance Act, 1994, read with Service Tax (Determination of Value) Rules, 2006 is correct, when the Rule itself is not in existence at the time of
the provision of taxable services?
Assessee M/s. Gopinath & Sharma is a firm of Chartered Accountants duly registered with the Institute of Chartered Accountants of India. As the
services rendered by the assessee are taxable under the category of ""Chartered Accountant Services"" by virtue of the provisions contained in
Chapter V of the Finance Act, 1994, the assessee duly registered themselves with service tax and issued with Registration No.
AAAFG4230GST002. During the course of audit, it was ascertained that the assessee have provided taxable service to their clients by sub-
contracting the work to their associates. Assessee had out-sourced/sub-contracted their operations with other Chartered Accountant Firms
situated in other Cities and Towns in respect of the activities relating to their clients. After issuing show cause notice (11.09.2008), the
Commissioner of Service Tax, Chennai passed an Order in Original No. 96 of 2009 dated 16.12.2009 levying service tax of Rs. 6,43,310/- and
interest and also imposing a penalty of Rs. 6,43,310/-.
Aggrieved by the order dated 16.12.2009 which was received by the assessee on 30.12.2009, the assessee filed an appeal in Form ST-4
before the office of the Commissioner of Service Tax, Chennai-35 on 12.03.2010. In terms of Section 85(3) of Finance Act, 1994 an appeal
against the order of Lower Adjudicating Authority has to be filed before the Commissioner of Central Excise (Appeals). According to assessee,
noticing the error of filing appeal before the wrong Forum, they immediately filed copies of appeal in Form ST-4 before the Commissioner of
Central Excise (Appeals) along with their letter dated 26.12.2011 and the same was acknowledged on 29.12.2011. The First Appellate Authority
Commissioner of Central Excise (Appeals) observed that enquiries were made with the Commissioner of Service Tax and ascertained that no
records were available with that office for filing such appeal by the assessee. Since the appeal [Appeal No. 24/2012 (MST)] has been filed after
two years from the date of issue of the order (16.12.2009) i.e. even beyond the condonation period, by order dated 16.02.2012, the
Commissioner of Central Excise (Appeals) dismissed the appeal.
Being aggrieved by the dismissal of the appeal, assessee filed appeal before Customs, Excise and Service Tax Appellate Tribunal (CESTAT).
Pointing out that there was delay of more than two years in seeking the remedy before the First Appellate Authority and that as per Section 85 of
Finance Act, the Tribunal held that First Appellate Authority has no power to condone the delay beyond the statutory period of three months plus
discretionary period of another three months under the proviso to sub-section 3 of Section 85 of Finance Act. Observing that there is nothing on
record to substantiate the bonafide of the assessee''s averments that appeal was filed before the Commissioner of Service Tax and that Section 5
of Limitation Act does not apply to the proceedings under Finance Act 1994, the Tribunal dismissed the appeal.
Mr. S. Jaikumar, learned counsel for assessee contended that appeal in Form ST-4 addressed to the Commissioner of Central Excise
(Appeals) by mistake was filed by the staff of the assessee in the office of the Commissioner of Service Tax and obtained acknowledgement dated
12.03.2010 and immediately on noticing the error, assessee filed copies of appeal before the Commissioner of Central Excise (Appeals) along
with their letter dated 26.12.2011 and the Tribunal failed to consider the enormous materials placed by the assessee regarding filing of appeal in
the wrong Forum and receipt and acknowledgement supported by records. Drawing our attention to the typed set of papers, it was submitted that
the impugned order was passed without taking cognizance of the appeal being filed before the Commissioner of Service Tax and without verifying
the facts and calling for the records, the Tribunal hurriedly passed the impugned order and prays for allowing of the appeal.
Mr. V. Sundareswaran, learned counsel for department submitted that the Order in Original No. 96 of 2009 was passed on 16.12.2009 and as
per Section 85 of Finance Act 1994, appeal ought to have been filed within the statutory period of three months plus discretionary period of
another three months under proviso to sub-section 3 of Section 85 of Finance Act and since the appeal was filed after the period of about two
years, the First Appellate Authority has no power to condone the delay beyond the statutory period of three months. Learned counsel would
submit that Tribunal has rightly held that Section 5 of Limitation Act is not applicable to the proceedings under Finance Act and no question of law
is involved in this appeal.
We have considered the rival submissions and also the materials on record.
Assessee is a partnership firm of Chartered Accountants and are engaged in providing taxable service under the category of ""Chartered
Accountant Services"". During the course of audit conducted by the Internal Audit Group of Chennai Service Tax Commissionerate, it was
ascertained that assessee provided taxable service to their clients by sub-contracting the work to their associates.
The scrutiny of the records for the period from April 2003 to June 2006 revealed that assessee had discharged their service tax liability only on the
service charges realised by them but had not paid the service tax on the reimbursement expenses realised by them from their clients. After issuing
show cause notice, by order dated 16.12.2009 in Order in Original No. 96 of 2009, the Commissioner of Service Tax passed an order
demanding service tax of Rs. 6,43,310/- payable by the assessee during the period from April 2003 to June 2006 and interest and also imposed
penalty equal to the amount of demand i.e., Rs. 6,43,310/- u/s 78 of Finance Act, 1994. Aggrieved by the said order, assessee filed appeal before
the Commissioner of Central Excise (Appeals) after two years on 26.12.2011 which was acknowledged on 29.12.2011.
As per Section 85(3) of Finance Act 1994, appeal shall be presented within three months from the date of receipt of the order of the
Adjudicating Authority relating to service tax, interest or penalty. As per the proviso to sub-section (3) of Section 85 of Finance Act, if sufficient
cause shown by the assessee, the First Appellate Authority can condone the delay during the discretionary period of another three months. The
Statutory Authority is not vested with the power to exercise any discretion beyond the period stipulated by law i.e. three months plus discretionary
period of another three months.
In terms of Section 85(3) of Finance Act, appeal against the order of Adjudicating Authority has to be filed before the Commissioner of Central
Excise (Appeals). It is the case of assessee that appeal in Form ST-4 addressed to the Lower Appellate Authority Commissioner of Central
Excise (Appeals) was by mistake filed by the staff of the assessee in the office of the Commissioner of Service Tax and obtained
acknowledgement (with round seal of the department) dated 12.3.2010. Further case of assessee is that in their busy schedule, they did not notice
the mistake of filing the appeal before the Commissioner of Service Tax instead of Commissioner of Central Excise (Appeals) and the error
escaped the attention of assessee''s Firm till they were issued with a notice for recovery of arrears. When the jurisdictional Superintendent of
Service Tax by his Proceedings in C. No. IV/16/200 STC GR I dated 16.11.2011 called for details of appeal and only at that juncture, the
assessee noticed the mistake. According to assessee, on noticing the error, immediately, they filed copies of appeal before the Commissioner of
Central Excise (Appeals) along with their letter dated 26.12.2011 and the same was acknowledged by the office of the Commissioner of Central
Excise (Appeals) on 29.12.2011. Case of assessee is that by mistake the appeal was filed before the wrong Forum and without calling for details
from the assessee or affording opportunity of hearing, the Lower Appellate Authority in Appeal No. 24/2012 (MST) dated 16.02.2012 dismissed
the appeal that the appeal was filed beyond the period of six months including the condonable period of three months.
In support of his contention that Form ST-4 appeal to be filed before the Commissioner of Central Excise (Appeals) was wrongly filed before
the Commissioner of Service Tax, the learned counsel for assessee has drawn our attention to Page No. 32 of typed set of papers (dated
29.1.2013) which contain round seal of the Office of Commissionerate of Service Tax dated 12.03.2010. By perusal of the said Form ST-4 (in
Page No. 32 of typed set), it is seen that in Column No. 3, the order under challenge is stated to be ""Order in Original No. 101/2009 dated
22.12.2009"". Column No. 3 reads as follows:-
Designation and address of the Officer passing the decision or order appealed against and the date of the decision or order.
The Additional Commissioner of Service Tax
MHU Complex,
692, Anna Salai, Nandanam, Chennai-35
Order in Original No. 101/2009 dt. 22.12.2009.
The order to be challenged by the assessee was Order in Original No. 96 of 2009 dated 16.12.2009; whereas the above Form ST-4 relates to
the Order in Original No. 101 of 2009 dated 22.12.2009.
Learned counsel for assessee submitted that as per Form ST-4, the period of dispute from April 2003 to June 2006 and the amount of service
tax demanded under challenge was Rs. 6,43,310/- as levied in the Order in Original No. 96 of 2009 and therefore, prayed to draw inference that
the Order in Original has been mistakenly typed as Order in Original No. 101 of 2009 dated 22.12.2009 instead of Order in Original No. 96 of
2009 dated 16.12.2009.
We are unable to persuade ourselves to accept the above submissions. The assessee is stated to be a reputed partnership Firm of Chartered
Accountants rendering Chartered Accountant Services. Having regard to the high profile of services rendered by the assessee, the submissions of
assessee that the number of the Order in Original Number has been mistakenly typed in Form ST-4 cannot be countenanced. The assessee had
also filed RTI application before the Commissioner of Service Tax requesting them to provide Inward Correspondence Numbers with date and
copies of the respective folios of the IC Register. The information obtained from the Commissioner of Service Tax is filed in Page No. 42 of the
typed set of papers (29.1.2013). By perusal of the information, it is seen that the Commissioner of Service Tax has clearly stated that ""Appeal
against the Order in Original No. 96 of 2009 dated 16.12.2009 (filed on 12.03.2010) was not received in the Service Tax Commissionerate.
First Appellate Authority made enquiries with the office of the Commissioner of Service Tax, Chennai and ascertained that no records were
available with that office for filing appeal against the Order in Original No. 96 of 2009 dated 16.12.2009. Considering in the light of the information
obtained under RTI Act, the factual finding recorded by the First Appellate Authority cannot said to be an erroneous or contrary to the facts and
materials on record.
Drawing our attention to the information obtained under RTI Act, the learned counsel for assessee submitted that all the papers received by the
Commissioner of Service Tax are not being accounted for in the IC Register and as such merely because there is no entry in the IC Register, the
receipt of the appeal by the Commissioner of Service Tax cannot be disputed or denied with. Drawing our attention to the information obtained in
respect of twenty eight documents, learned counsel submitted that out of 28 documents, only eleven documents were recorded in the IC Register
and for thirteen documents, it is mentioned that the same were received; but not entered in the IC Register and for three documents, it is mentioned
that files are not immediately traceable and therefore, merely because no entry was made in the IC Register, the receipt of the appeal in Form ST-
4 by the Commissioner of Service Tax cannot be disputed or denied with. Upon perusal of the entries made in the IC Register maintained by the
Service Tax Commissionerate, it is seen that the papers received were entered as ""received"" in the regular course of official work. Of course some
of them were not entered in the IC Register. Insofar as the appeal said to have been filed by the assessee before the Commissioner of Service Tax
on 12.03.2010, it is clearly stated as ""not received"". As per the entry, when the appeal filed by the assessee against the Order in Original No. 96
of 2009 dated 16.12.2009 was not received by the office of the Commissioner of Service Tax, the assessee cannot contend that appeal was filed
before the wrong Forum and that would save the limitation. First Appellate Authority as well as the Tribunal concurrently recorded factual finding
that there is nothing on record to show bonafide of the assessee''s averments that they have filed the appeal before the Commissioner of Service
Tax. The record of Commissioner of Service Tax does not contain appeal papers said to have been filed in its office under acknowledgement. In
the absence of any record, the concurrent finding recorded by the First Appellate Authority and the Tribunal cannot be interfered with.
In the order passed in Order in Original No. 96 of 2009 dated 16.12.2009, appeal was filed before the Commissioner of Central Excise
(Appeals) on 26.12.2011, acknowledged on 29.12.2011 beyond the period of three months plus discretionary period of three months. Tribunal
rightly referred to the decision in Singh Enterprises Vs. Commissioner of Central Excise, Jamshedpur and Others, holding that a statutory authority
is not vested with power to exercise any discretion beyond the period stipulated by law and that the appeal filed beyond the prescribed period of
limitation is not maintainable as being barred by limitation. It is well settled law that once the period of limitation has run itself out, the Appellate
Authority does not have power to condone the delay in filing the appeal beyond the maximum period prescribed under the Act. Referring to Singh
Enterprises case Singh Enterprises Vs. Commissioner of Central Excise, Jamshedpur and Others, , Tribunal has rightly dismissed the appeal. We
do not find any infirmity in the order of the Tribunal and no substantial questions of law involved in this appeal and the appeal is dismissed. No
costs.