Sh. Arvind Bankat Lal Sarda, Director and M/s Tanushree Logistics Pvt. Ltd. V. Union Of India (UOI) and Ld. Superintendent Customs, Central Excise And Service Tax Settlement Commission Principal Bench and Ld. Commissioner, Central Excise Commissionerate Jaipur

CW/4753/2018

AI Insights

The case involves M/s Tanushree Logistics Pvt. Ltd. and its director, Sh. Arvind Bankat Lal Sarda, who challenged the decision of the Service Tax Settlement Commission. The Commission had rejected their applications for settlement under Section 32E of the Central Excise Act, 1944, which pertains to the settlement of disputes related to service tax. The primary contention was that the Commission erroneously relied on a letter from a subordinate officer, which imposed conditions not present in the initial admission of the case. The petitioners argued that their case was similar to precedents where the Commission had allowed settlements without such conditions. The respondents, including the Union of India and various tax authorities, defended the Commission's decision, emphasizing the legal framework governing the settlement process.

• Counselvise Citation: [2018] 140 COUNSELVISE.COM (IT) 701904 (HC-RAJASTHAN)
• Appeal Type: Others
• Pronouncement Date: 25-07-2018
• Assessment Year: misc
• Other Referred Cases: In re: Oriflame India Pvt. Ltd., DGCEL vs. Murari Lal Harish Chander Jaiswal Pvt. Ltd., M/s. Padmavati Tubes vs. The Commissioner of Central Excise and Service Tax, Stallion Rubber Ltd. vs. CCE, Union of India vs. Dharampal Satyapal
• Laws Referred To: Central Excise Act, 1944, Finance Act, 1994
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: ANUROOP SINGHI; ADITYA VIJAY
• Assessee Lawyers: M P DEVNATH; DAKSH PAREEK
• Keywords: Classification dispute; Goods Transport Agency service; Service tax; Settlement commission; Supply of Tangible Goods Service
• Section: 83; 66E; 32E; 32F

Judgement Text

"HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Civil Writs No. 4753/2018 Sh. Arvind Bankat Lal Sarda Director, M/s Tanushree Logistics Pvt. Ltd. , C-10/57, Chitrakoot Yoojna Opp. Pratap Stadium Jaipur - 302 021 ----Petitioner Versus 1. Union Of India (UOI), Through Secretary Revenue/chairman, Central Board Of Excise And Customs, Ministry of Finance, Department of Revenue, North Block, New Delhi-110001. 2. Ld. Superintendent Customs, Central Excise And Service Tax Settlement Commission Principal Bench, Hotel Samrat, Chanakya Puri New Delhi. ----Respondent No.2 3. Ld. Commissioner, Central Excise Commissionerate Jaipur , New Central Revenue Building Statute Circle, C- Scheme Jaipur - 302 005 ----Respondent No.3 Connected With D.B. Civil Writs No. 4752/2018 M/s Tanushree Logistics Pvt. Ltd. , Ajmer N.h. 8, Near Aaraam Hotel Vill. Gidani, Post- Dudu Distt. Jaipur-303008 Through Its Authorised Signatory And Vice President Mr. Pawan Jajoo. ----Petitioner Versus 1. Union Of India (UOI) Through Secretary Revenue/ Chairman, Central Board Of Excise And Customs, Ministry of Finance, Department of Revenue, North Block, New Delhi-110001 2. Ld. Superintendent Customs, Central Excise And Service Tax Settlement Commission Principal Bench, Hotel Samrat, Chanakya Puri New Delhi. ---Respondent No.2 3. Ld. Commissioner, Central Excise Commissionerate Jaipur , New Central Revenue Building, Statute Circle, C- Scheme, Jaipur- 302 005. (2 of 22) [CW-4753/2018] ----Respondent No.3 For Petitioner(s) : Mr. M.P. Devnath with Mr. Daksh Pareek For Respondent(s) : Mr. Anuroop Singhi with Mr. Aditya Vijay HON'BLE MR. JUSTICE KALPESH SATYENDRA JHAVERI HON'BLE MR. JUSTICE VIJAY KUMAR VYAS Judgment 25/07/2018 1. In both these petitions common question of law and facts are involved hence they are decided by this common judgment. For convenience of the court, the facts are taken from CWP No.4752/2018. 2. By way of these petitions, the petitioners have assailed the judgment and order of the Settlement Commission whereby Settlement Commission has rejected the applications preferred by the petitioners on the ground that they have not fulfilled the condition of Section 32E of the Central Excise Act, 1944. 3. The facts of the case are that the petitioner is a Private Ltd. Company engaged in the transportation of goods by road. The petitioner owns more than four hundred vehicles for the purpose of transportation of goods. All the vehicles are registered as ‘Public Carrier’ and accordingly Road tax, registration charges, etc. stand discharged. The petitioner was providing goods transport agency service (GTA service) under Service tax laws. Liability of payment of Service tax under GTA service was on the service receiver. The receiver, Sh. Cement Ltd. (for short SCL) was discharged Service tax on the GTA service provided by the petitioner. The Service tax Department had been accepting this payment of Service Tax as (3 of 22) [CW-4753/2018] GTA service from SCL during the period 2009 to 2015 and onwards (to the best knowledge of the petitioner) and the same has never been questioned till date. Notwithstanding the fact that Service tax of Rs.21.25 crores (approx) under GTA service stood discharged on the transaction between the petitioner and SCL for the period covered by SCN; unnecessary harassment was caused to the petitioner by conducting search proceedings, investigations on the same transaction; ultimately culminating in issuance of show cause notice on the petitioner. 3.1 The show cause notices were issued demanding Service tax from the petitioner under the category of “supply of tangible goods service” on the same transactions with SCL, where Service tax already stood discharged under GTA service, this show cause notice sought to impose penalties on the Director of the petitioner. 4. Counsel for the petitioner first contended that the matter was admitted by three Members of Settlement Commission on 17.1.2017 by passing the following order:- “The case was heard on 17.1.2017 for admission, and the same stands admitted. 5. There was no condition while admitting the matter, however, Superintendent of the Commission who is the Administrative Head wrote a letter on 17.1.2017 which is produced on record where he has written as under:- Sub: Service Tax Settlement Application filed by M/s. Tanushree Logstics Pvt. Ltd. and Sh. Arvind Bankat Lal Sards u/s 32E of Central Excise Act, 1944 made applicable to service tax vide Section 83 of the Finance Act, 1994 (32 of (4 of 22) [CW-4753/2018] 1994) to settle a dispute arising out of SCN No. C.No. V(H) Adj.I/ST/200/2014/2099 dt. 15.10.2014 issued by the Commissioner, C. Ex. & S. Tax, Jaipur-I-reg.:- I am directed to inform the Hon’ble Bench has allowed the applications filed by the above mentioned applicants to be proceeded with in terms of sub-section (1) of section 32F of the Central Excise Act 1944, as made applicable to Service Tax vide Section 83 of the Finance Act, 1944 (32 of 1994), subject to the condition that the applicant show at the time of final hearing that they fulfill the conditions of Section 32E of the Central Excise Act, 1944. 2. You may also submit six copies of all the documents you intend to rely upon in support of your contentions in terms of para 6(2) of Customs and Central Excise, Settlement Commission Procedure, 2007. 6. Counsel for the petitioner has contended that the Superintendent has travelled beyond the order which was unconditional and the Commission has committed serious error in relying on the letter issued by the sub-ordinate officer. He has relied upon the ground E.6 which reads as under:- E.6 In any case, the fourth proviso to section 32E(1) of the Central Excise Act, 1944 can have no application in Service tax matters. The reason for disputes relating to classification of excise tariff not being before the Settlement Commission stands succinctly stated in the decision of the Commission in the case of In re: Oriflame India Pvt. Ltd. 2000 (122) ELT 601 (Sett. Comm.) wherein it was held as follows:- 26. We should now briefly deal with the fourth issue raised by the Bench. The 3rd proviso to section 32E(1) states that an application for interpretation of the classification of the excisable goods under the Central Excise Tariff Act, 1985 cannot be made. The main provision of section 32E(1) however, requires that the application is to give particulars of the excisable goods in respect of which he admits short levy on account of mis-declaration or otherwise. Section 32F(1) shows that cases involving complexity are expected to be settled (5 of 22) [CW-4753/2018] by the Settlement Commission. A complicated case may have several issues including one of classification, bearing on the determination of the duty amount to be paid. It is, therefore, appears that the 3rd provision to section 32E(1) refers to exclude an attempt by an applicant to have a pure calssification issue settled by the Commission. This is so because classification of goods has to be uniform for all manufacturers of identical goods and there cannot be any settlement with regard to classification of goods per se. In this case, however, as correctly pointed out by the learned Advocate and accepted by the Department’s Representative, we are concerned only with Chapter Note IV to Chapter 33 of Central Excise Tariff. This Chaprt Note lays down that certain activities which may otherwise not qualify to be manufacturing activity shall be construed as manufacture for specific goods falling under this Chapter. One of such activity is labeling or re-labeling of containers intended for consumers. This Chapter Note does not require any interpretation of classification of the goods. It only refers to an activity which can be deemed to be manufacture. The application in the present case cannot be said to be barred on the ground of provision of 3rd proviso to section 32E(1). 6.1 He also relied upon the observations made by the Settlement Commission which reads as under:- 19. We have perused the case records and the submissions made during the hearing held on 22.3.2017 and find that as per Section 32E(1), an application for Settlement of a ‘case’ pending before an adjudicating authority can be filed if, besides other conditions, the additional amount of duty accepted by the applicant exceeds Rupees Three Lakhs. In the instant case, the applicant has accepted duty liability of Rs.3 laksh each in respect of both the sow cause notices. This duty liability accepted by the applicants is on account of the service falling under section 66E of the Finance Act, 1994. On perusal of the show cause notice, we find that the admission of Service tax by the applicant on the services falling un/s 66E due to pilferage is not the subject matter (6 of 22) [CW-4753/2018] of the said SCNs in respect of which the present settlement applications have been filed. The duty liability accepted by the applicant is extraneous to the SCNs and is not towards a ‘case’ as defined in Clause (c) of Section 32 of Central Excise Act, 1944. In view of the same, we hold that acceptance of Service tax liability of Rs.3 lakhs each in respect of two SCNs for which the present applications have been filed do not make the applicant eligible to approach settlement Commission. Apparently, the duty liability equivalent to the minimum required amount of Rs.3 lakhs as prescribed under clause (c) of sub section (1) of Section 32E has been accepted by the applicant in relation to the services not being the subject of the duty demand in the SCN, in an attempt to project himself as being eligible to approach the Settlement Commission. In case, however, some other SCN has been issued to the applicant relating to this duty acceptance on account of services falling u/s 66E, the applicant is free to approach the Settlement Commission in a separate application. 20. We further find that in the two SCNs the Department has alleged that the services being provided by the applicant are classifiable under “the supply of tangible goods” and has collectively demanded a sum of Rs.85.61 crores as service tax from the applicant. The applicants, on the other than in his Settlement Application and during the hearing on 22.3.2017 has contended that the services provided by him fall in the category of “Goods Transport Agency” on which the Service tax has already been discharged by the service recipients under reverse charge mechanism. Further as per Annexure 2 to the Settlement Application, the applicants has not accepted any additional duty liability. Subject of the SCNs is thus a dispute regarding the classification of services being provided by the applicant. In this context, we note that the fourth proviso to sub section (1) of Section 32E made applicable to service tax as per Section 83 of the Finance Act, 1994 expressly prohibits making an application for settlement for the interpretation of classification. The argument of the Advocate Sh. M.P. Devnath, during the hearing held on 22.3.2017 that consequent upon the introduction of Negative List, there cannot be any classification disputes is far fetched as the valuation of services and duty liabilities and abatements continue to depend (7 of 22) [CW-4753/2018] upon the classification of services. This, coupled with the fact that no duty liability has been accepted by the application in relation to the “cases” for which the settlement applications have been filed as required under clause (c) of the first proviso to sub section (1) of Section 32E of Central Excise Act, 1944, makes the applicant ineligible to approach the Settlement Commission in the present form. 22. During the hearing on 22.3.2017, the applicants were specifically asked to file any further written submissions, which they have not done. Further, keeping in view of the facts as detailed above, we conclude that the applicant is not eligible to approach the Settlement Commission based on their own submissions in the application for Settlement and thereafter. Once, it is established that applicant is not eligible to approach Settlement Commission, granting another opportunity to be heard on merits is meaningless. 23. The applicants claims to have made a true and full disclosure of his duty liability based on which the applications were allowed to be proceeded with on 17.1.2017. However, only after the receipt of the Jurisdictional Commissioner’s letter dt. 7.3.17 enclosing their report dt. 27.2.17 and after receiving the applicant’s rejoinder dt. 20.3.2017 and the hearing held on 22.3.17, it came to the knowledge that the disclosure of Service Tax liability as claimed by the applicant was not with reference to the demand of Service Tax in the show cause notices for which the applicant has filed the present applications. Disclosure of Service Tax Liability made by the applicant is not true since the applicant has claimed in his letter dt. 20.3.17 that additional duty liability of Rs.3,00,000/- is in respect of SCN dt. 15.10.14. However, as discussed in detail in the preceding paragraphs, this admitted Service Tax liability does not pertain to the service in respect of which the SCN has been issued. Similarly in respect of second application received on 3.1.17, the additional admitted Service Tax liability of Rs.3,00,000/- is also not even remotely connected with the dispute. Once the disclosure of Service Tax liability is not true as is apparent in this case then Settlement application already admitted can be rejected at any stage till the issue of the Final Order. 25. Similar views have also been held by Hon’ble Delhi High Court in case of DGCEL vs. (8 of 22) [CW-4753/2018] Murari Lal Harish Chander Jaiswal Pvt. Ltd. (2013 (291) ELT 484). 26. Even otherwise the applicants were informed under the Commission’s letter dt. 17.1.17 that their applications have been admitted subject to the condition that the applicants show at the time of final hearing that they fulfill the conditions of Section 32E of Central Excise Act, 1944. 7. He further contended that Settlement Commission has failed to appreciate the judgments of the full bench of the Commission which were strongly relied upon by the present petitioner. The relevant part of the judgment reads as under:- 7.1 In RE: Triruchengode Lorry Urimaiyalargal Sangam, 2016 (41) STR 343 (Sett. Comm.) wherein it has been held as under:- 2.9 The applicant entered into agreement for transportation of petroleum product by road with M/s. Hindustan Petroleum Corporation Ltd. The applicant owns two Tanker Trucks and the contract was awarded by M/s. HPCL for a contract price depending on the actual transportation of the goods per kilolitre per kilometer basis. 3.4 The applicant supplied lorry for hire to M/s. HPCL for transportation of fuels and are receiving lorry hire charges based on work order issued by M/s. HPCL. The SCN alleges that the above services provided by the applicant are classifiable under ‘Supply of Tangible Goods Service’. Since the applicant submitted that by mistake it was mentioned as ‘hire charges’ instead of ‘freight’, it should be treated as GTA. This claim is a classification dispute, and appeared to be out of purview of Settlement Commission, as per third proviso to Section 32E of the Central Excise Act, 1944. 7.7 Revenue demanded Service Tax on the basis of the description ‘Hire charges’ reflected in the financial statements of the Sangam and construed the activity of transporting petroleum products from oil companies namely HPCL as Supply of Tangible Goods Service. Revenue adduced (9 of 22) [CW-4753/2018] that the essential ingredients of the definition of supply of Tangible Goods Service ingrained in Section 65(105 (zzzz)) namely that there should be a service provider and recipient the service must be in relation to supply of goods and the goods supplied must be tangible goods, including machinery equipment and appliances, the goods supplied must be for use apparently by the service recipients and supply of machinery goods or appliances must be without transferring the right of possession and the effective control. The Sangam did not issue any invoices/bills/chits or any other document for the ‘hire charges’ collected from HPCL. Revenue went on further to state that the issue involved was a classification dispute as to whether the service rendered was classifiable under supply of Tangible Goods Service of GTA service and therefore this issue could not be brought before the commission for Settlement. 7.8 M/s. HPCL had already registered this activity under GTA service, discharged Service Tax on the freight charges paid to Sangam under reversed charge mechanism. 7.2 In RE: Crest Communication Ltd., 2003 (152) ELT 452 (Sett. Comm.), wherein it has been held as under:- (i) Under the statutory provision applicable to settlement of Customs and Central Excise cases, whether the applicant can disclose more than the amount mentioned in the show cause notice. (ii) Whether the amount indicated by the applicant as admitted liability can be varied by the Settlement Commission, keeping in view the correct legal proposition relating to the facts referred to in the application and in accordance with the legal provisions in the Customs and Central Excise laws. 7. In view of the legal position enumerated supra, the issues referred to Special Bench for decision can be answered as below:- (i) Under the statutory provisions applicable to settlement of Customs and Central Excise cases, whether the applicant can disclose (10 of 22) [CW-4753/2018] more than the amount mentioned in the Show Cause Notice. Ans. The applicant has inherent right to disclose any amount above Rs.2 lakhs as the disclosure is related to the assessment documents and not in relation to the Show Cause Notice. The Show Cause Notice or may not have covered all the issues or the entire amount in as much as it is the Applicant who knows what is the amount not paid by him. Besides, the Applicant has exclusive knowledge as to how, when and how much duties of Customs has not been paid by him which may or may not have come to the notice of the investigating agency while issuing the Show Cause Notice. For these reasons, the applicant can disclose more amount than the amount mentioned in the Show Cause Notice. (ii) Whether the amount indicated by the applicant as admitted liability can be varied by the Settlement Commission, keeping in view the correct legal proposition relating to the facts referred to in the application and in accordance with the legal provisions in the Customs & Central Excise laws. And. In view of the reasons referred in answer to question (I) supra, the reply for this is in the affirmative. (iii) What is the correct and proper construction of the terms ‘on matters covered by the application and any other matter relating to the case not covered by the application but referred to in the report of the Commissioner of Customs or the Commissioner of Investigation under sub- section (1) or sub-section (6) appearing in sub-section (7) of Section 32F of the Central Excise Act, 1944/Section 127C of the Customs Act, 1962. Ans. On a plain reading of the provisions of sub-section (7) of section 127C of the Customs Act, it appears that the expression “the matters covered by the application” would mean only those facts and evidences which are disclosed in the application, while the expression “any other matter relating to the case not covered by the application” would mean those facts and evidences which, though related to the case, are not disclosed in the application. Later, through inquiry and investigation, these undisclosed facts and evidences can be brought out either in the report of the concerned jurisdictional Commissioner of Customs or (11 of 22) [CW-4753/2018] the Commissioner (Investigation), as the case may be. To illustrate, say, in a case of under- valuation of imported goods where the importer declares only the FOB value of the goods on the plea that the expenses incurred on account of freight and insurance are not known. In the circumstances, the Assessing Officer, besides enhancing the FOB value, also adds to its freight to the extent of 20% of the FOB value and insurance to the extent of 1.25% of the FOB value as per the Customs Valuation Rules, 1988 and thus determines the CIF values and thereafter by adding to it landing charges to the extent of 1% of the CIF value, determines the assessable value for the purposes of the assessment of duty. Later, this case is brought to the Commission by the importer for settlement. After admission of the application, the Commission finds from the report of the Commissioner that the assessable value would be more than what has been determined by the assessing officer in as much as during the investigation, the department has found that the importer has actually paid more freight and insurance which have not been disclosed before the proper officer earlier. Consequently, the admitted liability falls short of the actual liability. In this situation, the Commission cannot ignore the report of the Jurisdictional Commissioner or the Commissioner (Investigation) in as much as the report is the statutory requirement in terms of sub- section (6) and sub-section (7) of Section 127C of the Customs Act, 1962. If it is not taken into account, the report of the Commissioner would be merely an empty formality rendering the provisions redundant and irrelevant. Viewed from this angle, it can be safely said that the Commission is required to take into account the report of the Jurisdictional Commissioner or the Commissioner (Investigation) to determine the correct amount of duty liability of the applicant in accordance with law. (iv) Whether the law empowers the Settlement Commission to increase the amount of duty disclosed in the application either on account of calculation mistake made in the Show Cause Notice or on account of new issues arising in course of (12 of 22) [CW-4753/2018] settlement proceedings or incorrect application of law or otherwise in the Show Cause Notice. Ans. From the various interpretations of the law discussed elsewhere, it is clear that the Settlement Commission has to decide the application made in the matter before it in accordance with the provision of the Act. If the Settlement Commission is to take a decision in accordance with the Act, the various provisions of the Customs Act are applicable. The Settlement proceeding implies determination of correct amount of duty payable in the matter before the commission. Therefore, the Settlement Commission has to look into all aspects of the case including calculation mistakes, new issues and any other matters where the Settlement Commission thinks true and proper for an effective order of settlement. The Additional Bench, Mumbai shall dispose of the case of M/s. Crest Communication Ltd. in the light of the aforesaid decisions. 7.3 He also relied upon the averments made in the rejoinder before the Commission which reads as under:- (v) Issue note one of Interpretation of classification at all An identical question that is arising in the present matter was before this Hon’ble Commission in the matter of Re: Tricuhengode Lorry Urimaiyalargal Sangam 2016 (41) STR (Sett. Comm.) and the issue was decided by this Ho’ble Commission on the merits of the issue. The averment made in the Report already stands noted by this Hon’ble Commission and the same has been declined in the past by this Hon’ble Commission. Consequently, the objection of classification raised in the Report of the Commissioner of Central Excise, Jaipur-I is devoid of merit and in any case, the fourth proviso to section 32E(1) of the Act can have no application in Service tax matters. The reason for disputes relating to classification of excise tariff not being before the this Hon’ble Commission has been succinctly stated in the decision of this Hon’ble Commissioner in the case of In re: Oriflame India Pvt. Ltd. 2000(122) ELT 601 (Sett. Comm.) wherein it was held as follows:- (13 of 22) [CW-4753/2018] 26. We should now briefly deal with the fourth issue raised by the Bench. The 3rd proviso to section 32E(1) states that an application for interpretation of the classification of the excisable goods under the Central Excise Tariff Act, 1985 cannot be made. The main provision of section 32E(1), however, requires that the applicant is to give particulars of the excisable goods in respect of which he admits short levy on account of mis-declaration or otherwise. Section 32F(1) shows that cases involving complexity are expected to be settled by the Settlement Commission. A complicated case may have several issues including one of the classification, bearing on the determination of the duty amount to be paid. It, therefore, appears that the 3rd proviso to section 32E(1) refers to exclude an attempt by an applicant to have a pure classification issue settled by the Commission. This is so because classification of goods has to be uniform for all manufacturers of identical goods and there cannot be any settlement with regard to classification of goods per se. In this case, however, as correctly pointed out by the learned Advocate and accepted by the Department’s Representative, we are concerned only with Chapter Note IV to Chapter 33 of the Central Excise Tariff. This Chapter Note lays down that certain activities which may otherwise not qualify to be manufacturing activity shall be construed as manufacture for specific goods falling under this Chapter. One of such activity is labeling or re-labeling of containers intended for consumers. This Chapter Note does not required any interpretation of classification of the good. It only refers to an activity which can be deemed to be ‘manufacture’. The application in the present case cannot be said to be barred on the ground of the provision of 3rd proviso to section 32E(1). 27. In view of our findings above, the application is admitted and is allowed to be proceeded with under section 32F(1)... As seen above, the reason for disputes of classification of goods not being before this Hon’ble Commission is for the reason that the classification is based on the Excise Tariff and the same is required to be identical for all manufacturers of identical goods and these cannot be settlement regarding the same. As against Excise Tariff, levy of Service tax is a contractual levy and (14 of 22) [CW-4753/2018] ‘services’ being intangibles cannot be equated with movable property such as goods, which are classifiable under a particular tariff entry when an identical process is undertaken to bring about an act of manufacture. For Service tax purposes, the contract entered into between the parties is paramount and the activities executed pursuant to the contract are determinative of the service that stands rendered. It is settled law that literal construction which makes a provision absurd or leads to anomalous results is to be avoided [reliance is placed on CCE vs. Raison India (10) STR 505]. Consequently, merely because classification issues of excise tariff are not before the Hon’ble Commission cannot ipso facts lead to the conclusion that classification of Service tax issues are also required to be meted with the same treatment. In any case, post 2012 with the advent of Negative list under Service tax laws there is no segregation of taxable services. Consequently, Service tax matters cannot be barred on the ground of any classification dispute. For this reason, the objection raised in the Report is devoid of merit. In any case, the real issue in the present matter is actually not one of classification. Shree Cement Ltd. has been discharging Service tax under ‘goods’ transport agency service’ on the transaction entered into by the Applicant after claiming the benefit of exemption Notification No.25/2012-ST. To the best of knowledge of the Applicant, the Department has all along being accepting this Service tax liability. The Department to augment excess revenue decided to issue the show cause notices demanding Service tax from the Application on the same transaction under ‘supply of tangible goods service’ basically on the premises that there was no Service tax exemption if this service were to apply. Consequently, the essence of the show cause notices is not really on the issue of classification. The Department is seeking to given color to the dispute as one of classification given that actually when Service tax stands discharged as ‘goods transport agency service’ then the benefit of exemption notification comes into effect. It is most important to note that the Department cannot go against its own Service tax registration. The Hon’ble (15 of 22) [CW-4753/2018] Supreme Court in the case of CCE vs. Tata Tech Ltd. 2008(11) STR 449 (SC) held as follows:- The short question which has not been considered by the authorities below and which is not the basis of the show cause notice issued by the Assistant Commissioner (Adjudicating Authority) had the power to go beyond the Registration Certificate issued by the Competent Authority treating the respondent-assessee as the consulting engineer prior to 10th September, 2004? 2. Since the very foundation is missing, we are not inclined to interfere in this Civil Appeal. According, the Civil Appeal stands dismissed with no order as to costs. In the present matter, to the best of knowledge of the Applicant, the Department has given Service tax registration to Shree Cement Ltd. under the category of ‘goods transport agency service’ on this very transaction in question. Further, to the best of knowledge of the Applicant, the Department has been accepting the Service tax returns filed by Shree Cements Ltd. on this transaction under ‘goods transport agency service’. Given this, the Department is not permitted to go against its own Service tax registration and seek to demand Service tax from the Applicant on the same dispute raised by the Department is incorrect in law. It is also settled law that one arm of the Government cannot take a stand contradictory to the other arm of the same Government. It is also settled law that State which is represented by the Department can speak only with one voice [reliance is placed on 2005(6) SCC 292]. In the present matter, the same Commissionerate is taking contradictory stands. At the end of Shree Cement Limited, Service tax registration and Service tax is being collected as ‘goods transport agency service’. And on the same transaction itself, Service tax is also being demanded from the Applicant. This contradiction on the part of the Department itself establishes that the show cause notices have been issued in violation of law. It is also settled law that the same transaction cannot be made liable to tax twice. The Department is seeking to precisely demand Service tax twice on the (16 of 22) [CW-4753/2018] same transaction entered into between the Applicant and Shree Cement Limited. The Department is required to be put to strict notice on the basis as to why Service tax is sought to be demanded twice on the same transaction. It is settled law that State has no right to retain a tax collected without authority of law and the same is required to be refunded [refer Commissioner of Sales Tax vs. Auriaya Chamber of Commerce, Allahabad 1986 (25) ELT 867 (SC)]. Given, this the Department is required to be put to strict notice on their position in the matter. If the view of the Department is in consonance with that of the show cause notice then the Department is required to inform whether they were collecting Service tax from Shree Cement Limited under ‘goods transport agency’ during the period from 2009-2015 on the transaction entered into with the Applicant. If yes then why was the amount not refunded back and why was Shree Cement Limited not informed to de- register itself under ‘goods transport agency service’. The entire issue raised by the Department appears to be riddled in contradiction. It is also not in dispute that Shree Cement Limited had a number of other transporters who were also providing ‘goods transport agency service’ as that provided by the applicant. The Applicant is required to be treated with parity with the others. It is settled law that there is need for equal treatment of assessee [reliance is placed on Jai Vijai Metal Udyog Private Limited vs. CTT 2010 (6) SCC 705]. The Department should be put to notice to justify whether identical stand was taken against the other transporters rendering services to Shree Cement Limited, as was done against the Applicant. 7.4 Further, in para no.C.32 of rejoinder, he contended as under:- “C-32 The applicant reiterates its position as mentioned in its application and submission made in above paras and denies the averments made in the Report. The present matter is not covered by the decision placed in the Report. On the contrary the present matter is squarely (17 of 22) [CW-4753/2018] covered by the decision of this Hon’ble Commission itself in the matter of Re: Triuchengode Lorry Urimaiyalargal Sangam 2016 (41) STR 343 (Sett. Comm.)” 8. He contended that the ground taken by him was not considered by the Commission and he was not heard on merits. 9. Counsel for the petitioner has relied upon the judgment of this court in Stallion Rubber Ltd. vs. CCE 2018 (8) GSTL 151 (Raj.) wherein it has been held as under:- 2. Whether the principles of judicial discipline and binding precedence are violated in the facts and circumstances, when the learned CESTAT has overlooked and not considered their own dictum/order of not taxing retarding of tyres under service tax prior to 16.6.2005? 4. Counsel for the appellant has contended that the two decisions reported in 2009(14) STR 339 and 2010 (18) STR 70, the same Bench of the tribunal required to consider the same but it has not been considered. 50. We make it clear that we are deciding only question no.2 which was admitted by this court on 18.4.2012 and the trbinal will consider decisions and it will be open for him to give findings independently on merits of this case. However, he could not ignore the delivery of decisions by the same Bench. In that view of the matter, the order of the tribunal is quashed and set aside. 7. It will be open for the Tribunal to reconsider the matter afresh after considering two decisions relied upon by the assessee and given reasons independently without influenced by the fact that this court has set aside the order on merits to maintain jurisdictional discipline since two decisions are not considered. 8. In view of the above, we remit back the matter to the Tribunal, we have not expressed any opinion on the merits of the case and the Tribunal will give its own finding after considering both the judgments. (18 of 22) [CW-4753/2018] 9.1 He also relied upon the decision of Gujarat High Court in M/s. Padmavati Tubes vs. The Commissioner of Central Excise and Service Tax 2017(3) TMI wherein it has been held as under:- 8.0 In view of the above and for the reasons stated above and on the aforesaid ground, the impugned judgment and order passed by the learned Customs, Excise and Service Tax Appellate Tribunal, Ahmedabad in appeal No.E/399/2008 dt. 310.10.2014 is hereby quashed and set aside and the matter is remanded to the learned Tribunal to decide the appeal afresh in accordance with law and on merits and after considering the submissions which may be raised by the respective parties and after considering and dealing with the citations that may be relied upon either of the parties. The aforesaid exercise shall be completed within the period of three months from the date of the receipt of writ of the present order. The present appeal is partly allowed to the aforesaid extent. The question No.C is held in favour of assessee and against the revenue. The question nos. A and B are not answered in favour of either party. 10. Counsel for the respondent contended that under the statutory provision, there is no need of passing detail order in the judicial side but Superintendent has pointed out what are the mandatory statutory provisions which are to be followed. 11. Counsel for the respondent has relied upon the three judgments:- 11.1 In Lok Nath Prasad Gupta vs. Union of India 2016 (343) ELT 97 (Del.), it has been held as under:- 16. We have carefully considered the rival contentions. Judicial review of the order of the CCESC has its own parameters and limitations. We can only examine the decision-making process but not the actual decision arrived at by the CCESC, (19 of 22) [CW-4753/2018] unless the decision is irrational, illegal or perverse. This position is well settled and reference may only be made to the judgment of S.B. Sinha, J. speaking for the Supreme Court in State of U.P. and Anr. Vs. Johrimal MANU/SC/0396/2004 : (2004) 4 SCC 714. The following observations sum up the entire legal position:- It is well-settled that while exercising the power of judicial review the Court is more concerned with the decision making process than the merit of the decision itself. In doing so, it is often argued by the defender of an impugned decision that the Court is not competent to exercise its power when there are serious disputed questions of facts; when the decision of the Tribunal or the decision of the fact finding body or the arbitrator is given finality by the statute which governs a given situation or which, by nature of the activity the decision maker's opinion on facts is final. But while examining and scrutinizing the decision making process it becomes inevitable to also appreciate the facts of a given case as otherwise the decision cannot be tested under the grounds of illegality, irrationality or procedural impropriety. How far the court of judicial review can reappreciate the findings of facts depends on the ground of judicial review. For example, if a decision is challenged as irrational, it would be well-nigh impossible to record a finding whether a decision is rational or irrational without first evaluating the facts of the case and coming to a plausible conclusion and then testing the decision of the authority on the touch- stone of the tests laid down by the Court with special reference to a given case. This position is well settled in Indian administrative law. Therefore, to a limited extent of scrutinizing the decision making process, it is always open to the Court to review the evaluation of facts by the decision maker. 11.2 In Commissioner of Customs (Import) vs. Noshire Moddy, 2014 (300) ELT 205 (Bom.), it has been held as under:- 6. Counsel appearing on behalf of the Revenue submits that the car which was imported was not a new car within the meaning of the exemption notification. Whether a vehicle is or is not new is a pure finding of fact. The facts which have been found by the Settlement Commission indicate that the car was in fact a new car which was transshipped from the manufacturer in Italy to the Ferrari dealer in the U.K. who sold the car to a (20 of 22) [CW-4753/2018] dealer in the U.K. The Respondent purchased the car from the dealer in the U.K. The Settlement Commission has noted that the registration of the car in the U.K. was only to comply with the requirement of the licensing authorities in the U.K. who require registration even for the purposes of exportation. The car was not used in the U.K. The finding that the vehicle was a new motor vehicle is not perverse or contrary to the evidence. The Respondent made a fair and candid disclosure and accepted the undervaluation and paid the differential duty together with interest. 7. In this view of the matter, no case for interference has been made out having regard to the limited scope for interference in an order passed by the Settlement Commission. The order of the Settlement Commission is not shown to be perverse or contrary to law. 11.3 In Union of India vs. Dharampal Satyapal 2013 (298) ELT 653 (Del.), it has been held as under:- 57. It appears to us, on a fair reading of both the majority and the minority opinion, that the better view is the one taken by the minority. In coming to this conclusion, we have fully taken note of the limits of judicial review of the orders of the Settlement Commission. The limits have been set out clearly in the judgment of the Supreme Court in the case of State of U.P. and Anr. Vs. Johrilal MANU/SC/0396/2004 : (2004) 4 SCC 714. The gist of the judgment is that though the power of judicial review is more about the decision- making process rather than the merits of the decision itself, while examining and scrutinizing the decision making process, it becomes inevitable to also appreciate the facts of a given case so as to test the decision on the touchstones of illegality, irrationality or procedural impropriety. An evaluation of the facts of the case would necessarily be involved even to record a finding that the decision is irrational. With particular reference to orders of the Settlement Commission, the following judgments may be referred to where the limits of judicial review of the orders of the Settlement Commission have been adumbrated:- (1) R.B. Shreeram Durga Prasad and Fatechand Nursing Das v. Settlement Commission (It and Wt) and Anr., MANU/SC/0429/1989 : (1989)176 ITR 169 (SC) (21 of 22) [CW-4753/2018] (2) Jyotendrasinhji v. S.I. Tripathi and others, MANU/SC/0313/1993 : (1993)201 ITR 611 (3) Shriyans Pradad Jain v. Income-tax Officer and others, MANU/SC/0410/1993 : (1993)204 ITR 616 (4) Kuldeep Industrial Corporation etc. v. Income- tax Officer and others, MANU/SC/0899/1997 : (1997) 223 ITR 840 A careful study of both the majority and the minority opinions expressed by the Settlement Commission shows that on the basic principles that are applicable to the proceedings before the Settlement Commission, there is no major disagreement. All the three members, including the Chairman, are agreed that it cannot be said that there was no full and true disclosure of the duty liability merely because the applicant did not admit the duty liability mentioned in the show cause notice which, in the present case, is `245.56 crores. They are also agreed that if the case involves a detailed adjudication into complex facts and issues of duty liability, the proper forum would be the adjudicating officer and not the Settlement Commission. It is only in the application of these principles to the facts of the case that there is disagreement between the members, the Chairman and one member constituting the majority holding that the applicant has made a full and true disclosure of the duty liability and the case also does not involve any adjudication, and the lone dissenting member taking the view that on the facts of the case there was no full and true disclosure of the duty liability and further that the case involves adjudication and not settlement. 12. Taking into consideration, in our considered opinion, even if condition u/s Section 32 is mandatory, the appropriate remedy for the Registrar or the Superintendent is to go before the judicial member of the Commission. In view of the earlier Division Bench judgment, the order is required to be modified, however, the Commission subject to provisions of Section 32 admitted the matter and written a letter and taking support of subordinate officer of the Commission passed the order which in our considered opinion is not proper. (22 of 22) [CW-4753/2018] 13. In that view of the matter, keeping in mind the earlier decision of this court, we reverse the ground taken by the Commission and set aside the order of the Commission. 14. However, it is made clear that we have not expressed any opinion on the merits of the case. 15. The Commission will reconsider the matter in view of law laid down by the Commission itself in accordance with law. 16. The petitions stand allowed. (VIJAY KUMAR VYAS),J (K.S. JHAVERI),J Brijesh 112-113. "