Page 226 - GSTL_2nd April 2020_Vol 35_Part 1

128 GST LAW TIMES [ Vol. 35
10. It is again a well settled position of the law that a person who
claims the exemption has to prove that he satisfies all the conditions of the Noti-
fication so as to be eligible to the benefit of the same. References can be made to
the Hon’ble Supreme Court Constitutional Bench decision in the case of CCE v.
Harichand Shri Gopal 2010 (260) E.L.T. 3 (S.C.); Mysore Metal Industries v. CC,
Bombay 1988 (36) E.L.T. 369 (S.C.); Moti Ram Tolaram v. Union of India - [1999
(112) E.L.T. 749 S.C.]; Collector v. Presto Industries - 2001 (128) E.L.T. 321 and Hotel
Leela Ventures v. Commissioner - 2009 (234) E.L.T. 389 (S.C.). It stands held in all
the above decisions that onus to prove and show the satisfaction of the condi-
tions of the Notification is on the person who claims the benefit of the same and
every exemption Notification has to be read in strict sense. In the case of CCE v.
Paranteral Drugs - 2009 (236) E.L.T. 625 (S.C.), the position was reiterated by the
Hon’ble Apex Court that exemption Notification have to be read strictly and
burden is on the assessee to show that they fall within the four corners of the ex-
emption Notification. Reference can again be made to the latest decision of the
Hon’ble Supreme Court in the case of Commissioner of Customs (Import), Mumbai
v. Dilip Kumar & Company referred supra that burden to prove entitlement of tax
exemption in terms of the Notification is on the person claiming such exemption.
We may also refer to another decision of the Hon’ble Supreme Court in the case
of Larsen & Toubro Ltd. v. Commissioner of Central Excise, Hyderabad - 2015 (324)
E.L.T. 646 (S.C.). In view of the abovesaid law, we note that the appellants have
admittedly not fulfilled both the conditions of the Notification as regards to
payment of R & D Cess before the payment of service tax and have not main-
tained the records so as to establish the linkage between the invoices of the R & D
challans, as per the requirement of the Notifications. As such, we agree with the
Adjudicating Authority that the appellant was not entitled to the benefit of the
Notification.
11. The demand also stands assailed by the appellant on the ground of
limitation. The Adjudicating Authority has invoked extended period of limita-
tion by observing that the appellant never disclosed at any point of time that
they have adjusted R & D Cess before discharging payment of the service tax.
This is not a case of any bona fide interpretation inasmuch as the wordings of the
Notifications are very clear and required the importer recipient to pay R & D
Cess before the payment of service tax so as to avail exemption. The appellants
have not given any justifiable reasons for not paying R & D Cess in time and for
availing exemption without such payment of R & D Cess. As such, we agree with
the Adjudicating Authority in respect of the invocation of longer period of limi-
tation.
12. In respect of penalty, the Adjudicating Authority referred to the
case law as follows :-
• In Corpus Juris Secundum, vol.85, at p. 580, para 1023, it is stated thus :-
“A penalty imposed for a tax delinquency is a civil obligation, re-
medial and coercive in its nature, and is far different from the pen-
alty for a crime or a fine or forfeiture provided as punishment for
the violation of criminal or penal laws.”
• R.S. Joshi v. Ajit Mills Ltd. (SCC p. 110, para 19)
“Even here we may reject the notion that a penalty or a punishment
cannot be cast in the form of an absolute or non-fault liability but
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