CESTAT, MUMBAI BENCH
Commissioner of Customs & Central Excise, Wardha
ORDER NO. A/86635/2016/SMB
APPEAL NO. ST/86723/2015
MARCH 17, 2016
B. Kumar Iyer, Superintendent (AR) for the Appellant. Jayesh M. Gogri, CA for the Respondent.
1. This Revenue’s appeal is directed against Order-in-Appeal No. NGP/EXCUS/000/APP/187/15-16 dtd. 11/6/2015 passed by the Commissioner (Appeals) Central Excise & Customs; Nagpur wherein Ld. Commissioner (Appeals) set aside the Order-in-Original No. IV(16) 19-259/ST/AMT/2013 7383 dated 27/11/2014 and allowed the appeal of the respondent.
2. The fact of the case is that the Respondent applied for VCES Scheme on 31/12/2013 and after obtaining the service tax registration, they attempted to deposit 50% of declared tax dues of Rs. 32,98,972/- for the period October 2010 to December, 2012. After making number of attempts on the website the transaction could not be completed and report shows “assessee code invalid”. Subsequently on 1/1/2014 the appellant deposited the amount of Rs. 16,49,486/- through two banker’s check of IDBI Bank in State Bank of India, Amravati Branch. The Adjudicating authority vide letter dated 27/11/2014 communicated to the respondent that since respondent have not paid 50% dues on or before the 31/12/2013 in view of Hon’ble Delhi High Court in case of Teknow Overseas (P.) Ltd. v. Asstt. CST (VCES)  45 GST 663, the respondent are not entitle for the benefit of VCES Scheme notified under Finance Act, 2013. Aggrieved by the said letter the respondent filed appeal before the Commissioner (Appeals) who allowed the appeal of the respondent, hence the Revenue is in appeal.
3. Shri, B. Kumar Iyer, Ld. Superintendent (A.R.) appearing on behalf of the Revenue appellant reiterating the grounds of appeal submits that due date i.e. 31/12/13 provided for discharging 50% of the declared service tax due is mandatory under statute and same cannot be extended under any circumstances. In the present case the respondent has admittedly paid the 50% dues only on 1/1/2014 therefore not complied with the condition of payment of 50% dues on or before 31/12/2013. He submits that Adjudicating Authority has correctly followed the ratio of the Hon’ble Delhi High Court judgment therefore Ld. Commissioner (Appeals)’s order is not in consonance with the Hon’ble Delhi High Court judgment in case of Teknow Overseas Ltd. (supra) hence the same is not sustainable and deserve to be set aside.
4. Shri Jayesh M Gogri, Ld. C.A. appearing on behalf of the respondent submits that judgment of Hon’ble Delhi High Court is not applicable in the present case as the facts of this case are different. He submits that in the present case, respondent undisputedly applied for the registration on 31/12/2013 and attempted to deposit the service tax online through website. However, due to system failure, the amount could not be deposited therefore there is no fault on the part of the respondent.
5. I have carefully considered the submissions made by both sides.
6. I find that there is no doubt that as per VCES Scheme, 2013, 50% of the declared dues is suppose to be deposited on or before 31/12/2013 and there is no provision for extension of that period for deposit. However in the present case, the respondent undisputedly applied for registration, obtained assessee code number and attempted to deposit 50% amount on 31/12/2013 however due to system fault the amount could not be deposited and report is on record which shows that ‘assessee code invalid’. It is observed that on 31/12/2013 respondent’s bank account in IDBI bank shows credit balance of more than 50% amount which was to be deposited. In view of these facts, respondent has scrupulously followed the procedure and complied with condition i.e. applied for registration and attempted to deposit the amount on the due date i.e. 31/12/2013 but only due to system fault online, the respondent could not deposit the amount which is beyond the their control therefore, in the peculiar facts of this case it can be construed that there is no delay on the part of the respondent, hence though the payment finally made on 1/1/2014 the same can be treated as if, payment was made on 31/12/2013. The judgment relied upon by the Original authority in case of Teknow Overseas Ltd. (supra) is not applicable in the present case for the reason that fact of that case is different from the facts of present case. In the Teknow Overseas Ltd. (supra) the assessee has knowingly asked for extension of time beyond the 31/12/2013 for deposit of part of 50% dues and deliberately not deposited the amount on or before the 31/12/2013. In the present case there is no intention of the respondent to avoid payment of 50% of the declared dues on or before 31/12/2013. In fact, the respondent admittedly and bonafidely attempted to deposit an amount on 31/12/2013 but only because they were handicapped as the system has not accepted the payment could not be deposited the amount. Hence due to differences in the facts of both the cases the judgment of Teknow Overseas Ltd. (supra) is distinguished.
6.1 As per above discussion and facts of the present case, I am of the considered view that impugned order is legal and proper which does not require any interference. I therefore uphold the impugned order and dismiss the appeal of the Revenue.