Service Tax on Notional interest incurred on Security Deposit received for Renting Immovable property

PJ/Case Study/2011-12/27

CASE STUDY

Prepared By:
CA Pradeep Jain
Sukhvinder Kaur LLB [FYIC]

Introduction:-

In the case under study was that the assessee had received security deposit from the tenant who had taken the immovable property of the assessee on rent. There was no interest was earned by them but the department was alleging that the notional interest must be earned by the landlord on such security deposit and they must pay the service tax on such notional interest.

M/s Taj Hari Mahal v/s Deputy Commissioner, C. Ex. Division, Jodhpur
[Order-in-Appeal no. 428 (CB)ST/JPR-II/2011, Dated: 30.08.2011]

Brief Facts:-

- Appellant are a leading hotel in the city of Jodhpur and are registered under the category of Renting of Immovable property. For renting of immovable property, the appellant had received security deposit from their tenant. The relevant period of dispute if June 2007 to September, 2009.

- Department issued show cause notice to the appellant demanding service tax on the said amount with interest and also sought to impose penalties. The amount was treated as advance rent. Appellant filed reply to the show cause notice.

- The Adjudicating Authority confirmed the demand with interest and imposed penalties under Section 76 and 77 of the Finance Act, 1994. However, no penalty was imposed under Section 78 of the Act.

- Aggrieved by the confirmation of demand of service tax, appellant preferred appeal before the learned Commissioner (Appeal).

Assessee’s Contentions:-

Assessee made following submissions before the Commissioner (Appeal):

-           That the order in original has been passed just discussing the relevant provisions i.e. sections and rules which were made applicable in the Show cause notice. The impugned order has just been passed ignoring all the contentions that were presented by the appellant. The cases referred by the appellant are just not distinguished by the learned Deputy Commissioner while passing the order. The order has been passed without any of the facts discussed by the assessee or saying why the facts were not relied upon by the learned Deputy Commissioner. As such, the order has been passed without even assigning the reasons why these decisions are not applicable in the case of appellant. Such a decision is not justified in the light of decision given by hon’ble Apex Court in the case of State of Himachal Pradesh Vs Sardara Singh [2008-TIOL-160-SC-NDPS] wherein it was held as follows:-

Even High Courts are required to pass speaking reasoned orders - The "inscrutable face of a sphinx" is ordinarily incongruous with a judicial or quasi-judicial performance. The manner in which appeal against acquittal has been dealt with by the High Court leaves much to be desired. Reasons introduce clarity in an order. On plainest consideration of justice, the High Court ought to have set forth its reasons, howsoever brief, in its order indicative of an application of its mind, all the more when its order is amenable to further avenue of challenge. The absence of reasons has rendered the High Court order not sustainable. The requirement of indicating reasons in such cases has been judicially recognized as imperative. Judicial discipline to abide by declaration of law by this Court, cannot be forsaken, under any pretext by any authority or Court, be it even the Highest Court in a State, oblivious to Article 141 of the Constitution of India. Reasons are live links between the mind of the decision taker to the controversy in question and the decision or conclusion arrived at. Reasons substitute subjectivity by objectivity. The emphasis on recording reasons is that if the decision reveals the "inscrutable face of the sphinx", it can, by its silence, render it virtually impossible for the Courts to perform their appellate function or exercise the power of judicial review in adjudging the validity of the decision. Right to reason is an indispensable part of a sound judicial system, reasons at least sufficient to indicate an application of mind to the matter before Court. Another rationale is that the affected party can know why the decision has gone against him. One of the salutary requirements of natural justice is spelling out reasons for the order made, in other words, a speaking out. The "inscrutable face of a sphinx" is ordinarily incongruous with a judicial or quasi-judicial performance.: SUPREME COURT;

The analysis of this decision makes it clear that the order passed without giving reasons of decision is not justified in the eyes of law. Further, to support our contention we rely on the case of WIPRO COMPUTERS LTD. Versus COMMISSIONER OF CUSTOMS, CHENNAI [2001 (135) E.L.T. 450 (Tri. - Chennai)] wherein the Tribunal held “An order not discussing evidence submitted by assessee nor technical literature or trade opinion a non-speaking order and not a legal order - Section 35A of Central Excise Act, 1944”and therefore, the order passed by the Dy. Commissioner is in violation of principles of natural justice and is required to be set aside. Further in the case of ARBINDO LIQUORS LIMITED Versus COMMISSIONER OF CENTRAL EXCISE, NAGPUR [2001 (133) E.L.T. 631 (Tri. - Mumbai)] says that anorder narrates only what the Assistant Commissioner said and not what the assessee said. Such an order does not give any insight to the further appellate authority as to the correctness of the findings. It is for this reason that the principles of natural justice require that any order made in adjudication or in appeal, should be a “speaking” order.

- Further in a recent decision in the case of The Commissioner of Central Excise Vs. M/S Cable Corporation of India [2010-TIOL-607-HC-MUM-CX], it has been said that CESTAT – Tribunal is expected to pass an order following principles of natural justice – dealing with all contentions- matter remanded-while deciding the case court is under an obligation to record reasons, however, brief, the same may be as it is a requirement of principles of natural justice. Non observance of the said principles would vitiate the judicial order.

So going through the analogy given in the above decisions the above order passed against the assessee is not tenable in law because the Learned Adjudicating Authority has not discussed the cases and the submissions that were relied on by the appellant.

- Further the order in original has been passed saying that as per Section 67 (ii) of the Finance act, 1994, said that if the consideration is not wholly of money, equivalent to consideration is to be added in assessable value, whether this equivalent consideration is received before, during or after the providing of service. The provisions of Section 67 were reproduced as under:

Section 67: Valuation of taxable service for charging service tax.

(1) Subject to the provisions of this Chapter, service tax chargeable on any taxable service with reference to its value shall,—

(i) in a case where the provision of service is for a consideration in money, be the gross amount charged by the service provider for such service provided or to be provided by him;

(ii) in a case where the provision of service is for a consideration not wholly or partly consisting of money, be such amount in money, with the addition of service tax charged, is equivalent to the consideration;

(iii) in a case where the provision of service is for a consideration which is not ascertainable, be the amount as may be determined in the prescribed manner.

(2) Where the gross amount charged by a service provider, for the service provided or to be provided is inclusive of service tax payable, the value of such taxable service shall be such amount as, with the addition of tax payable, is equal to the gross amount charged.

(3) The gross amount charged for the taxable service shall include any amount received towards the taxable service before, during or after provision of such service.

(4) Subject to the provisions of sub-sections (1), (2) and (3), the value shall be determined in such manner as may be prescribed.

Explanation.—For the purposes of this section,—

(a) “consideration” includes any amount that is payable for the taxable services provided or to be provided;

(b) “money” includes any currency, cheque, promissory note, letter of credit, draft, pay order, travellers cheque, money order, postal remittance and other similar instruments but does not include currency that is held for its numismatic value;

(c) “gross amount charged” includes payment by cheque, credit card, deduction from account and any form of payment by issue of credit notes or debit notes and ‘book adjustment, and any amount credited or debited, as the case may be, to any account, whether called “Suspense account” or by any other name, in the books of account of a person liable to pay service tax, where the transaction of taxable service is with any associated enterprise.

The appellant submit that the order in original has been passed considering the clause (ii) of the Section. But this Section is not applicable in the instant case. As the Section says that the additional consideration received may it be in the terms of money or not will be chargeable to service tax. This is not the case here. Non monetary consideration has not been received by them. Thus, the reference of this section while confirming the demand is not justified and the order is liable to be quashed.

- That the impugned order has wrongly referred sub section (ii) of section 67 whereas in the instant case only sub section (i) of this section is applicable. The sub section (i) of section 67 reads as follows:-

“(i) in a case where the provision of service is for a consideration in money, be the gross amount charged by the service provider for such service provided or to be provided by him;”

The analysis of this section makes it clear that the consideration means any amount which is charged by the service provider FOR SUCH SERVICE provided or to be provided. In the instant case, the service provided is renting of space for carrying on business by the tenant. For the said purpose the amount charged is RENT on which service tax is already paid. The security deposit is neither a consideration in lieu of rent, nor it has influenced the amount of rent. The security deposit was taken merely to protect the loss arising out of damage caused by the tenant to the property. In no way, it has any association with the determination of rent. Thus, when any amount has no association with the providing of service, i.e., when the amount is not FOR THE SERVICE PROVIDED, it will not fall in the above section 67(i). This analogy is further clarified by the explanation to this section 67. The explanation (a) reads as follows:-

(a) “consideration” includes any amount that is payable for the taxable services provided or to be provided;

Thus, the consideration includes only that amount which is PAYABLE for the service PROVIDED. In the instant case, the service provided is the renting of immovable property for which consideration is RENT only, not anything else. Thus, the contention of the impugned order is not tenable and is liable to be set aside.

- That security deposit was not a part of rent or any additional consideration other than the amount received as rent. Therefore, no service tax is payable on the same. It was explained by the appellant in the reply to the audit paras also that the said deposit was taken by us for repair of the rented property in case there is any damage caused by the tenant to the property. It was further explained that the rent was not reduced to adjust the benefits from the deposit. Moreover, the amount was kept in a current account and no interest was being incurred by us on the same. Thus, it was submitted that there was no service tax liability on the security deposit collected by us from our tenant. However, the order in original has not adhered to the submissions of the appellant. Therefore the order in original passed against the appellant is totally erroneous and is liable to be set aside. Further it has been held in the case of Commissioner of Central Excise, Bangalore versus Srikumar Agencies [2008 (232) E.L.T. 577 (S.C.)] that an order passed without considering the submissions of the appellant is a non speaking order and a non speaking order is not legally viable in the eyes of law.

TRANSWEIGH (INDIA) LTD. Versus COMMISSIONER OF C. EX., MUMBAI-V [2008 (224) E.L.T. 592 (Tri. - Mumbai)]

Valuation (Central Excise) - Notional interest on advance - Nexus with price of goods - Assessee asserting that they deposited the advance in current account and thereby did not earn any interest on it - As Revenue did not rebut that assertion, held that interest could not be presumed to be earned and price could not said to be influenced thereby - Section 4 of Central Excise Act, 1944. [para 3]

In the above case also it is said that when the advance is deposited in current account and no interest is earned on it, there could be no levy of tax. In the case of the appellant the amount is deposited in the current account and no interest is earned therefore the original in order imposing the demand and penalty should be set aside.

- That it is the liability of the department to establish a nexus between the security deposit and the amount of rent, without which service tax cannot be levied on the same. It has been held by the highest Court of India that burden is on the Revenue to prove that interest free advance has influenced the price. It has been held in the case of CCE, Tamil Nadu Vs M/s Southern Structural Ltd [2008-TIOL-154-SC-CX]as follows:-

“Burden is on Revenue to prove that interest-free advance has influenced the price:since the fact regarding advances received was already in the knowledge of the Department and the earlier similar proceedings initiated by the Department were dropped by the Assistant Commissioner, the Revenue was not justified in invoking the extended period of limitation.

If there is no difference in the selling price for both categories of the wholesale buyers and there is also 'no proof' that on account of advance deposits taken from some buyers, the price charged from all buyers has been reduced, then the element of notional interest on advance deposits, cannot be added. Obviously, where there are two prices, one for those who have made the advance and the other who have not, it would require no further proof of the lower price having been influenced by the interest-free advance made by the buyer. But otherwise it would require proof and the proof for the purposes of holding that interest-free advance has influenced the price would obviously be provided by the Revenue. There is no scope for any such presumption: SUPREME COURT;

As such, burden to prove that the rent has been influenced by the security deposit is on the department. In the appellant’s case, the Revenue has failed to discharge the burden of proof that the amount of rent has been affected by the security deposit. Therefore, the order in original has been issued on erroneous grounds and is liable to be set aside. Further the order in original has been passed without discussing the submissions and the cases cited by the appellant. It was recently held in M/s Nisha Cements Vs. CCE, Calicut [2010-TIOL-1255-CESTAT- BANG] Order passed by lower Appellate Authority confirming duty demand by neither addressing various grounds raised by assessee nor discussing case law cited and without giving proper findings thereon, not sustainable.

- Further reliance was placed on the following cases -

COMMISSIONER OF CENTRAL EXCISE, MUMBAI-III Versus I.S.P.L. INDUSTRIES LTD. [2003 (154) E.L.T. 3 (S.C.)]

Valuation (Central Excise) - Notional interest on the advances taken by the assessee, from the buyers - Where price is not influenced by the fact of interest free advance made by the buyer to the manufacturer, notional interest not includible to the assessable value of the goods - Where there are two prices, one for those who have made the advance and the other who have not, it would require no further proof of the lower price having been influenced by the interest free advance made by the buyer - Otherwise burden to prove that interest free advance has influenced the price would lie on the Revenue - No presumption can be drawn by mere fact of interest free advance by the buyer to the manufacturer - Section 4 of Central Excise Act, 1944. [paras 9, 11]

COMMISSIONER OF C. EX., MUMBAI-III Versus DALAL ENGINEERING PVT. LTD. [2009 (246) E.L.T. 484 (Tri. - Mumbai)]

Valuation (Central Excise) - Notional interest accruable on advances taken from customers not includible in assessable value, not having the effect of lowering price of goods - Explanation 2 to Rule 6 of Central Excise (Valuation) Rules, 2000 - Section 4 of Central Excise Act, 1944. - Explanation 2 to Rule 6 of Central Excise (Valuation) Rules, 2000 makes it amply clear that the notional interest may become additional consideration if it has effect of lowering the price. Therefore, the interest is not part of the transaction value. The notional interest is not an amount paid by the buyer to the respondents. What is paid by the buyer in connection with the sale is the ‘amount of advance’ and not the interest thereon. The interest is not a payment received by reasons of sale or in connection with the sale. The notional interest is not part of the price of the goods. It is not a consideration received in return of the sale. What is received in return of the sale is the amount of advance, but not the interest accruable thereon. Explanation 2 to Rule 6 ibid has clarified that the nexus between advance and the price of the goods has to be established. It has also clarified that the burden to establish the nexus lies on the shoulders of the Revenue and cannot be shifted to the assessee. Thus notional interest accruable on advance is not includible in assessable value.

COMMISSIONER OF C. EX., MUMBAI Versus SIMTOOLS LTD. [2007 (211) E.L.T. 558 (Tri. - Mumbai)]

Valuation (Central Excise) - Notional interests on advances - No finding that price has been influenced by fact that interest free advances were given by buyer to manufacturer - No nexus established between advances and assessable value - Burden of proving that price of goods was depressed as a result of receipt of interest free advances, not discharged by Department - Notional interests not includible in assessable value - Section 4 of Central Excise Act, 1944. [para 3]

It is said that the burden is on the revenue to prove that the advances and the notional interest has influenced the price here the rent. The revenue has to prove it for levy of tax on the interest. In the case of the appellant the revenue has not proved this. Further the appellant is not earning any notional interest on the advances therefore the original in order should be set aside.

- That the impugned order is confirming a demand that is partly time barred. The demand pertains to period of June, 07 to Sept, 09 and any demand of a period prior to one year cannot be confirmed unless there is a case of wilful misstatement, suppression, or fraud. None of these ingredients of invoking the extended period have been proved while confirming the demand. Thus, the part-demand is barred by the clause of limitation. It is further submitted that for invoking the extended period of limitation, the department should present something positive rather than mere inaction or failure on part of assessee. This has been held in the case of Chemphar Drug & Limits reported in (2002-TIOL-266-SC- CX) wherein hon’ble Supreme Court held as under:-

“Demand – Central Excise – Limitation –Invoking extended period of five years – something positive other than mere inaction or failure on part of the manufacturer or producer or conscious or deliberate withholding of information when the manufacturer knew otherwise, is required before it is saddled with any liability, before the period of six months.”

Thus, in the light of above decision, extended period cannot be invoked blindly in every case. Where the assessees have been acting in the boundaries of law, the extended period cannot be invoked. It is also held in the case of Pushpam Pharmaceuticals Company Vs. CCE, Mumbai reported in (2002-TIOL-235-SC- CX) that the Suppression of facts must be deliberate to escape from payment of duty. But the appellant had proved that they have been correctly paying the taxes and filing the returns on due time without any negligence on their part. They were also submitting the information required by the department from time to time. Further, audit of the concern have also been done from time to time by the departmental officers. As such, the records have been scrutinized deeply by various officials of revenue. But still, a partly time barred demand have been confirmed against them. For confirming a time barred demand, the revenue has failed to prove how the appellant had deliberately suppressed the facts with the intent to evade payment of service tax. Similar decision has been given in the case of M/s Idea Cellular Ltd Vs CCE, Rohtak [2009-TIOL-387-CESTAT-DEL]. In the instant case also, the department has failed to prove the deliberate suppression, the extended period is not invokable and the part of the demand is barred by the clause of limitation.

- Further the penalty under Section 76 & 77 is imposed on the appellant. It is submitted by the appellant when the Audit party has conducted the audit of the unit, the appellant have willingly produced all the records maintained by them before them, hence the question of any suppression of facts does not arise. It is submitted that the Department officers have found out about the security deposit during the audit and therefore, how the allegation of suppression of facts can be raised against us is beyond our understanding. The information of taking the two months/ three months rent in advance has been gathered out from the renting agreements or the accounts. So this information can be supplied by the appellant only. Therefore it cannot be said that the appellant has suppressed the facts from the department. Further this would have been the intention the appellant would never get these records in the hands of the department. Further the appellant submits that from the accounts it could also be revealed that the amount of advance that has been taken is not used by the appellant and there is no interest earned on the same. Therefore the original in order passed against the appellant is totally erroneous ad is liable to be set aside.

- Further the appellant submit that they have bona fidely believe that the amount received as security deposit from their tenant does not incur any service tax liability. They have submitted that the amount received as security deposit was not part of the rent but was a deposit for repair and maintenance purposes in case of any damage to the rented property by the tenant. Therefore, it is submitted that when they hold bona fidely the said amount was not rent and there was no service tax liability on the same, then there was no need to show the said amount in ST-3 return or to give intimation about it to the Department. Thus, the impugned order in original is liable to be quashed. Even if the contention of the department is accepted then also penalty is not imposable as the appellant acted under bonafide belief that no penalty is warranted. It has been held in the various cases that when any act is done under bona fide belief no penalty is imposable. As such, penalty for non-payment of service tax cannot be imposed on them. Further it has been held in various cases that no penalty is warranted when the assessee has acted on the basis of bonafide belief. Even the highest court of India – hon’ble Supreme Court has held in the case of COMMISSIONER OF CENTRAL EXCISE, TRICHY Versus GRASIM INDUSTRIES LTD. [2005 (183) E.L.T. 123 (S.C.)] that where the act of assessee is based on the interpretation taken by the Tribunal, penalty cannot be imposed as the act is based on bonafide belief. The verdicts of Apex Court are produced as follows:-

“Penalty - Bona fide belief caused by Tribunal’s decision - Tribunal in a number of cases giving an interpretation as understood by assessee - Penalty not imposable - Rule 173Q of erstwhile Central Excise Rules, 1944 - Rule 25 of Central Excise Rules, 2002. [para 20]”

The analysis of above decision makes it clear that since we have acted under bonafide, no penalty can be imposed on us. Therefore, the benefit of above decision of hon’ble Supreme Court should be extended the appellant and the original in order should be set aside and the whole proceedings should be dropped.

- Some of such cases are cited as follows: -

a)                  Sri Krishna Alloys vs Commissioner of Central Excise, Salem [2006 (200) ELT 158 (Tri.-Chennai)]:- In this case it was held that:-

“Penalty - Imposition of - A situation where an assessee acted under a bona fide belief does not call for invocation of the penal provisions - No penalty imposable in such a situation - Rule 15 of the Cenvat Credit Rules, 2004. [para 4]”

b)                  Asha Pavro Electronics Pvt. Ltd. vs. Commr. Of C. Ex., Mumbai-III [2002 (143) ELT 543 (Tri.-Mumbai)]:- The verdicts of Mumbai Tribunal are produced as follows:-

“Penalty - Demand - Extended period being not invocable in respect of demand, since assessee was under bona fide belief at relevant time, penalty not imposable - Erstwhile Rule 173Q of Central Excise Rules, 1944. [para 8]”

c)                  Navbharat Explosive Co. Ltd. vs CCE, Raipur [2005 (187) ELT 218 (Tri.-Del.)]:- In this case it was held that:-

“Cenvat/Modvat credit being availed by appellant under bona fide belief following earlier decision of Tribunal, penalty not imposable.”

d)                  Super Polyfabriks Ltd. vs. Collector of Central Excise, Chandigarh [1999 (114) ELT 1019 (Tribunal)]:- The verdicts of hon’ble Tribunal are produced as follows:-

“Penalty – Appellant under a bona fide belief that plastic strips emerging at intermediate stage exempt from duty – Penalty not imposable on appellant – Rule 173Q of the Central Excise Rules, 1944.”

Some other cases in support of our contention are cited as follows: -

·               Star Neon Singh vs. Commissioner of Central Excise, Chandigarh[2002 (141) ELT 770 (Tri.-Del.)]
·               Straw Products Ltd. vs. Collector of Central Excise, Indore [1996 (87) ELT 115 (Tribunal)]
·               Johnson & Johnson Ltd. vs. Collector of Central Excise, Bombay [1995 (78) ELT 193 (Tribunal)]
·               Indian Explosives Ltd. vs. Collector of Customs [1992 (60) E.L.T. 111 (Cal.)]
·               Tata Engineering & Locomotive Co. Ltd. vs. Collector of Customs [1991 (56) E.L.T. 812 (Tribunal)]
·               SuratMunicipal Corpn. Vs. Commissioner of C. Ex., Surat [2006 (4) S.T.R. 44 (Tri. - Del.)]

The above decisions are equally applicable the case of appellant also because they were under bona fide belief based on above judgments that no penalty is chargeable on us. Hence it is crystal clear that the order in original is not viable and is liable to be quashed.

Reasoning of the Commissioner (Appeal):-

- Demand of service tax on the notional interest accrued on the security deposits received from tenants: - The learned Commissioner (Appeals) noted that the Adjudicating Authority while confirming the demand observed that as per Section 67 (ii) of the Finance Act, 1994, if the consideration is not wholly of money, then money equivalent to consideration is to be added in assessable value whether this equivalent consideration is received before, during or after providing service. The interest on all initial deposits except made about Telephone connections forms the part of assessable value. Thus, the advance deposit generated notional interest @ 13% which resulted in non-payment of service tax.

- On the other hand, the Commissioner (Appeals) observed that the appellant had contended that the amount of advance deposits which the appellant received as part of contract is a security deposit which can be used for repair of the rented property in case of damage. The appellant also challenged the so called notional interest which worked out by the department on the basis of assumption and added that, no where adduced by the department if at all any such interest generated, and that so called interest no where depressed the value of rent and placed reliance on the following case laws: -

(a) CCE, Tamil Nadu Vs M/s Southern Structural Ltd [2008-TIOL-154-SC-CX]
(b) COMMISSIONER OF CENTRAL EXCISE, MUMBAI-III Versus I.S.P.L. INDUSTRIES LTD. [2003 (154) E.L.T. 3 (S.C.)]

- Relying upon the afore-mentioned judgments, the learned Commissioner (Appeal) held that in view of these landmark judgments pronounced by the Apex Court of India which pertain to Central Excise valuations are also applicable to the extent valuation of Service tax. One point which is common in both judgments is notional interest if presumed by the department for enhancing value of any goods or services, the onus is on to the department to prove that such advances have depressed the value and which resulted in the loss of revenue to the exchequer. In view of aforesaid legal position of law the impugned order-in-original held that the no such consideration has been elucidated by the department at ant point of time, therefore I have no hesitation to draw analogy from the afore-said judgments and set aside the impugned order on merit.

- It was further observed that any amount received before, during and after the provisions of services is liable to service tax under Section 67 (3) of the Finance Act, 1994 read with Rule 6 (1A) of the Service tax Rules, 1994, hence the whole amount of advance rent received would have taxed ab initio, but in the instant case this aspect has neither been alleged in the notice nor discussed in the impugned order. Nevertheless, the learned commissioner held that while determining the value of the service tax on account of the notional interest, the Adjudicating Authority also did not invoke power vested with for rejection of value under Rule 4 of Service Tax (Determination of Value) Rules 2006. Furthermore, it was also observed the impugned order has not been reviewed by the department leaving no scope to recover the service tax within the framework of statute at this juncture, therefore, I am constrained not to keep up this aspect to demand the service tax.

- In the end, it was held that since the demand is not sustainable on merit I do not find any reason to discuss remaining aspects of the appeal and set aside the impugned order with consequent relief from interest penalties to the appellant.

Decision of the Commissioner (Appeal):-

Appeal allowed.

Conclusion:- It is settled law that if the allegation that notional interest is earned by the service provider and it has influenced the assessable value then the onus lies on the department to prove the same. But if they have failed to prove the same then the demand of service tax on such notional interest is not sustainable.

But the best remark came from the officer of department only. When we were discussing this matter in the department then one officer said that everyone will agree that the department officers are very innovative and they apply their mind and raise the demand. This is true that the department officers raise the demand in number of ways whether it is sustainable or not. This is due to the fact that there is no accountability on their part. Had their been a provision that if the demand is not sustained in the end then the cost of the case will be recovered from the departmental officers then no such cases on such illogical grounds will be booked against the service provider.

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05 October 2011

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PJ/CASE STUDY/2011-12/27
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