- (1.) We are taking note of one of the cases i.e., W.P. (T) No. 1290 of 2013 in view of the similarity of facts in all the orders passed by the Assessing Officer. However, the assessee in all the proceedings are different but assessment orders as such passed against the assessee are not under challenge in these matters. The petitioner is aggrieved against the liability created against him without notice to him and against the observation made against the petitioner. Learned counsel for the petitioner submitted that petitioner is not the assessee nor he has been given any notice by the authority for levy of the service tax, interest or penalty. However, the petitioner was asked to furnish certain relevant information which the petitioner furnished to the said authority.
(2.) The said authority in the impugned order dated 31st December, 2012 concluded at page 61 of the paper book that "Looking into the facts and circumstances, I am convinced that the Noticee is required to pay the entire Service Tax demanded by the department. "Therefore, the Assessing Officer in unequivocal terms held that noticee the assessee before the Assessing Officer to be liable to pay the entire service tax and thereafter, the Assessing Officer has observed as under: Since the Noticee is a very small service provider, it was a major responsibility of the big brother, i.e.; DVC, CTPS, Chandrapura not only to guide their service providers to discharge the proper Service Tax liability but also to pay the due Service Tax on the to their service providers timely. Had they done the payment of Service Tax timely to their Service providers, there was no question of non payment of Service Tax by the Service providers to the Government of India. Though, surprisingly, the DVC CTPS has not been issued with the Show Cause Notice, though they played important role in non-payment of Service, by their Service providers. They cannot escape their responsibilities towards the Government and by guiding their Service providers to discharge the taxes in the legal manner. For more than abetting the non-payment of Service Tax to the Government of India DVC CTPS should set example by making payment of interest for delayed payment of Service Tax, which was required to be paid by them to their Service providers & should compensate for the penalties imposed on their Service providers. If the penalties and the interest and the Service tax due is recovered from the tiny Service Tax provider, this may amount to killing the small businessmen and their business. While DVC CTPS will clearly escape from their social and fiscal responsibilities completely. DVC CTPS is the Government of India Undertaking & accordingly, it is a part of Government. The payment of Service Tax for them would be just a book entry, as far as the Government of India is concerned but it will be the question of life and death for the tiny businessman. If DVC CTPS discharges their responsibility by payment of all the dues to their service providers, they would not only set a creditable example in the industry and the society as well. By doing this act of not ensuring Service Tax payments to their service providers, their working system has been exposed, especially when they have the taxation wing & specialized staff working for taxation and accounting. Such a Unit can not take a plea of not knowing the law and guiding their dependent Service Provider, who simply follow their guidelines/dictates. Payment of the Service tax due on behalf of their Service providers, the demand of Service Tax from these Service providers would reach the final end. On the other hand, demanding the dues from the tiny Service Providers would only add to only arrears of Service Tax, which is not desirable, especially, when the Service Tax is the tax of indirect nature and gets passed on to the final person. Demanding Service Tax from the beginners of chain would also amount to unjust enrichment of DVC CTPS, which is improper. Therefore, it is necessary for DVC CTPS not only to pay the entire Service Tax liability with interest and penalty amount to their Service Providers, but also ensure that their Service Providers discharge them as soon as they received the amount from DVC CTPS and pay to the Government of India in the treasury towards payment of Service Tax, interest and penalty dues.
(3.) And, then in concluding paragraph confirmed the payment of service tax on noticee M/s. T.A. Enterprises as well as confirmed the demand of interest under Section 75 of the Act, penalty under Section 77 of the Act for violation of the Sections 69 and 70 of the Act read with Rules 4 and 7 and imposed penalty of Rs. 749,466/-. Thereafter, in sub-paragraph (ii), it has been held by the Assessing Officer that: (ii) On DVC, CTPS, as they are fully involved in receiving above referred services from the Noticee and in turn owe the Service Tax dues to the Noticee, to compensate the entire financial loss including interest and penalty to the Noticee, on account of above order, as such loss arose on account of serious mistake and carelessness of DVC, CTPS. Had they paid the Service Tax amount timely to the Noticee, this situation could be avoided.;