Whether service tax required to be paid again if payment made under wrong accounting code?

PJ/CASE LAW/2015-16/2570

Case:- ARCADIA SHARE & STOCK BROKERS PVT LTD Vs COMMISSIONER OF CENTRAL EXCISE & CUSTOMS, GOA

Citation:- 2013-TIOL-1044-CESTAT-MUM

Brief facts:- The appellant, M/s Arcadia Share & Stock Brokers Pvt. Ltd., Goa are engaged in rendering of stock broker's service. During the period October, 2004 to July, 2005, the appellant discharged service tax liability on the services rendered by them under a wrong accounting code i.e service tax was remitted under the accounting code for education cess. The department issued a notice to the appellant for non-payment of service tax under the proper accounting code and the demand was confirmed vide order dated 17/03/2006. The appellant preferred an appeal before the lower appellate authority who rejected the appeal and hence the appellant is before Tribunal.

Appellant’s Contention:- The learned Consultant for the appellant submits that, as per Board's clarification vide Circular No. 58/07/2003-CX (ST) dated 20/05/2003, if an assessee has paid service tax under a wrong accounting code, they should not be asked to pay the service tax again. In such cases, the matter should be sorted out with the PAO. The learned consultant relies on the decision of the Tribunal in the case of Pepsico India Holding Pvt. Ltd. vs. Commissioner of Central Excise, Allahabad [2010 (255)ELT 299(Tri-Del)=(2010-TIOL-1556-CESTAT-DEL)]where in anidentical issue arose and this Tribunal, based on the above Circular held that the assessee isnot liable to pay service tax if he has discharged the service tax liability even though under awrong accounting code. Accordingly, he prays that the appeal be allowed.

Respondent’s Contention:- The learned Superintendent (AR) fairly concedes the position.

Reasoning of judgement:- After hearing both the sides and after going through the circular and the decision of this Tribunal in the case of Pepsico India Holding Pvt. Ltd. (supra), we agree with the contention of the appellant that they are not required to pay service tax again inasmuch as they have remitted their liability to the exchequer, though under a wrong accounting code. Accordingly, we set aside the impugned order and allowed the appeal.

Decision:- Appeal allowed.

Comment:- The crux of the case is that if the assesse has paid service tax under a wrong accounting code, he is not required to pay service tax again as per Board's clarification given vide Circular No. 58/07/2003-CX (ST) dated 20/05/2003and as held in the case of Pepsico India Holding Pvt. Ltd. v/s Commissioner of Central Excise, Allahabad 2010(255)E.L.T. 299(Tri.-Del).

Prepared by:- Neelam Jain

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PJ/CASE LAW/2015-16/2570

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