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of <h1>Tribunal overturns tax demand on insurance services provider due to lack of evidence</h1> The Tribunal allowed the appeal, setting aside the lower authorities' orders due to lack of evidence supporting the allegations. The appellant, engaged in ... Insurance services - Tax not paid services provided but payment not received - revenue alleged that the assessee had received the amount - appellant submits that the basis on which Revenue stated that they received payment from PACL, Nayanangal. is not disclosed to them - Held that:- SCN alleged non-payment of service tax on services provided to PACL, Nayanangal and payment received from PACL. SCN does not allege any payment directly from PACL, Nayanangal. During the adjudication stage, after the appellant has given submission that they were issuing policies to PACL New Delhi and receiving payment from that office, a finding was given that payment was received by the appellant directly from PACL, Nayanangal. No evidence to come to a finding other than what is alleged in the SCN is recorded in the adjudication order. In fact, if there is any finding, records relied upon should have been specified. Instead, Revenue has adopted a strategy of making allegation that the appellant have received payment directly from PACL, Nayanangal and then asking the appellant to prove that they have not received any such payment. I am of the view that such approach of asking the appellant to prove the absence of a fact is not in conformity with any judicial principle. If an allegation by Revenue was good enough to shift the burden of proof, then affirmation to the contrary by the appellant was also good enough to shift the burden back to Revenue, though I do not agree with either proposition. Revenue should have led evidence to prove that there was payment made directly by PACL, Nayanangal and that those were consideration for service provided on which service tax was not paid - Decided in favour of assessee. Issues:1. Whether the appellant provided insurance auxiliary service or insurance services to the respondent.2. Jurisdiction of the Assistant Commissioner at Ropar to issue the show cause notice.3. Maintainability of the demand of service tax based on the alleged receipt of payment from the respondent.Analysis:Issue 1:The appellant, engaged in providing insurance services, was alleged to have received an amount from the respondent without paying service tax. Initially, the show cause notice claimed the appellant provided insurance auxiliary service, but during adjudication, it was found that only insurance services were provided. The demand for service tax, interest, and penalty was disputed by the appellant.Issue 2:The appellant argued that the Assistant Commissioner at Ropar lacked jurisdiction to issue the show cause notice, as the insurance services were provided in Ropar but the appellant was centrally registered in LTU Chennai. The jurisdictional authority was later corrected, and adjudication was conducted accordingly.Issue 3:The appellant contended that they did not receive any payment from the respondent in question, Nayanangal, and the basis for Revenue's claim was not disclosed. The appellant emphasized that they issued policies to cover employees of the respondent's New Delhi office, and any payment received was in relation to services provided under those policies. The appellant failed to obtain a confirmation certificate from the respondent's New Delhi office to support their claim, leading the Commissioner to uphold the demand for service tax.In the final judgment, the Tribunal found that the show cause notice did not specify evidence of direct payment from the respondent, shifting the burden of proof unfairly onto the appellant. Revenue's failure to provide evidence of direct payment and consideration for services rendered led to the appeal being allowed. The Tribunal deemed the order unsustainable due to the lack of factual evidence supporting the allegations. The judgment set aside the lower authorities' orders with consequential relief, if any, in favor of the appellant.
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