The main legal point established is that the assessee cannot be made liable to pay double tax and that the issue of award of CENVAT Credit on the basis of photocopies of documents would become academic as the assessee is ready and willing to produce the original invoices.

JUDGMENT

1. This intra Court appeal is directed against the order dated 18.08.2021 passed in W.P.No.9636/2020, whereby the petition filed by the respondents -assessees has been allowed in part quashing the impugned part of the orders, matter was remitted to the Settlement Commission for consideration afresh in accordance with law and after notice to the stakeholders.

2. The respondent- M/s. Zyeta Interiors Pvt. Ltd., a company registered under the provisions of the Companies Act, 1956 is engaged in the business of carrying out design, supply and installation of interior works mainly for commercial establishments. The respondent is registered under the Service Tax Provisions vide ST Registration No.AAACZ3238JST001. Pursuant to the show cause notice dated 28.08.2018 issued by the Principal Additional Director General, Directorate General of Goods & Services Tax Intelligence [DGGSTI], the respondent had submitted an application dated 03.06.2019 for settlement of the proceedings. The Settlement Commission after hearing the parties, ordered for joint sitting of both the parties. Accordingly, the joint sitting was held on various dates. Both the parties submitted the joint sitting report before the Settlement Commission. The Settlement Commission passed the final order dated 24.03.2020 confirming the service tax amount of Rs.40,75,512/- along with interest and penalty of Rs.5,00,000/- and Rs.25,000/- respectively on the Director of the respondent company. The request made by the respondent for modification of the final order dated 24.03.2020 came to be rejected. Being aggrieved by the order dated 24.03.2020 passed by the Settlement Commission the respondent had approached the Writ Court. The learned Single Judge vide order dated 18.08.2021, allowed the Writ Petition in part quashing the impugned part of the orders and remitting the matter to the Settlement Commission for consideration afresh. Hence, this Writ Appeal by the Revenue.

3. The arguments of the learned counsel for the Revenue are two fold. Firstly, the assessee was required to strictly adhere to the provisions of Section 68[2] of the Finance Act, 1994 amended from time to time. In terms of the said provision, the ratio of 50:50 tax payable by the assessee and the service provider was altered to 75:25 with effect from 20.06.2012 vide 30/2012-ST and the same remained up to 01.04.2015. Thereafter, it was modified to 100% qua the consumer with effect from 01.04.2015. In terms of the said provision, the assessee was required to pay 75% of the tax. The tax paid in the ratio of 50:50 i.e., by the assessee and the service provider not being in conformity with the existing provisions of the Act applicable at the relevant time, the learned Single Judge ought not to have reversed the findings of the Settlement Commission in this regard.

4. Secondly, the learned counsel for the respondent/assessees argued that the photocopies of the invoices not being the required documents to award CENVAT Credit prescribed under Rule 9 of the CENVAT Credit Rules, 2004, learned Single Judge remanding the matter to the Settlement Commission for reconsideration afresh is not tenable.

5. Learned counsel appearing for the assessee placing reliance on the CBEC Circular No.341/18/2004-TRU [Pt.], dated 17.12.2004 submitted that though the said Circular was issued with respect to Goods Transport Agency Service [GTA Service] on reverse charge payment, the same analogy would be applicable to the case on hand i.e., the man power service. The reverse charge mechanism should not lead to double taxation. The tax amount being paid in full by the assessee under the service provider in the ratio 50:50, the same cannot be construed as shortage of payment of tax.

6. Nextly, it was argued that the law enunciated by the Hon'ble High Courts of Bombay, Gujarat and Punjab & Haryana in the case of Commissioner of Central Excise, Goa V/s. Essel Propack Ltd., [(2015) 57 taxmann.com 52 (Bombay)]; Commissioner of Central Excise & Cust