Appellate authority upholds service tax liability for Renting and Restaurant Services despite VCES declaration rejection.

The appellate authority upheld the Order-in-Original dated 05.01.2016, confirming service tax liability under Renting of Immovable Property Services and Restaurant Services. Despite the appellant's reliance on the Voluntary Compliance Encouragement Scheme (VCES) declaration, which was rejected, and challenges to tax liability calculation, the appellate authority found no merit in the appeal. The adjudicating authority's findings on value suppression and tax liability, along with the rejection of the VCES declaration, were upheld, leading to the dismissal of the appeal on 18/08/2017.

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Issues:
Appeal against Order-in-Original regarding service tax liability under Renting of Immovable Property Services and Restaurant Services.

Analysis:
The appeal was filed against an Order-in-Original dated 05.01.2016, where the appellant was charged with service tax liability under Renting of Immovable Property Services and Restaurant Services. The appellant claimed to have discharged the service tax liability under the Voluntary Compliance Encouragement Scheme (VCES) and provided details with the show cause notice. However, the adjudicating authority rejected the VCES declaration, leading to the appropriation of the service tax liability paid under VCES, along with interest and penalties. The appellant's grounds of appeal mainly focused on disputing the calculation of tax liability and emphasizing the correctness of the VCES declaration, stating they had paid the total service tax amount after obtaining a registration certificate.

Upon review, it was found that the appellant did not present any new grounds in the appeal but reiterated the correctness of the VCES declaration and challenged the tax liability calculation based on income tax returns. The appellate authority noted that the show cause notice accused the appellant of suppressing the value of services provided under Renting of Immovable Property Services and Restaurant Services. The adjudicating authority detailed the suppression of value and tax liability on Restaurant Services, granting 60% abatement. Despite the appellant's reliance on the VCES declaration, which was rejected, no additional evidence was presented to support their case.

The appellate authority upheld the impugned order, citing the lack of merit in the appeal. It emphasized that the adjudicating authority's findings on the suppression of value and tax liability, supported by detailed reasoning, were not effectively contested by the appellant. As the VCES declaration was deemed incorrect and rejected, the confirmation of demands, interest, and penalties by the adjudicating authority was deemed legally sound and appropriate.

Therefore, the appeal was dismissed, and the impugned order was upheld on 18/08/2017.

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