2022 (5) TMI 428 - AT - Service Tax

Tribunal confirms service tax demand against security services provider for evasion

Tops Security Limited Versus C.C.E. & S.T. -Daman

The Tribunal upheld the Order-in-Appeal confirming a service tax demand of Rs. 49,64,062 against a security services provider for evasion. The appellant's ... CENVAT Credit - it is alleged that the appellant were charging and collecting service tax from their clients but the same was not deposited properly and timely - separate registrations for their branch offices situated in their different parts of India, not obtained - demand of service tax with interest and penalty - HELD THAT:- The facts on records is that the investigation against the Appellant was initiated by the department on the ground that the Appellant charging and collecting service tax from their clients but the same is not deposited properly and timely. The case of the department is that appellant out of total service tax of Rs. 1,24,96,001/- produced the evidences of deposit of service tax of Rs. 75,31,939/- only, thus failed to deposit service tax of Rs. 49,64,062/-. In the present matter Appellant neither provided any evidences before the adjudicating authority/Commissioner (Appeals) nor before this tribunal to show that they have paid the disputed service tax. Therefore, the demand of Service Tax confirmed by the original authority and upheld by the Commissioner (Appeals) is legally correct. CENVAT Credit - HELD THAT:- The appellant could not produce any evidence or documents on the basis of which credit of Rs. 6478/- was taken. Accordingly, the demand is sustainable. There are no infirmity with the impugned order - appeal dismissed - decided against appellant. Issues:- Confirmation of service tax demand- Disallowance of Cenvat credit- Imposition of penaltiesConfirmation of service tax demand:The appeal was filed against the Order-in-Appeal confirming a demand for service tax evasion. The appellant, engaged in security services, did not have separate registrations for branch offices. The investigation revealed evasion of service tax, leading to a demand of Rs. 49,64,062 along with penalties and disallowance of Cenvat credit. The Adjudicating Authority confirmed the demand, disallowed the credit, and imposed penalties. The Commissioner (Appeals) upheld the order. The appellant argued that the demand was erroneous, and they had paid the service tax but faced accounting issues. However, they failed to produce evidence of payment. The Tribunal found no evidence of payment, upholding the demand.Disallowance of Cenvat credit:The appellant failed to produce valid Cenvat documents for the credit taken, amounting to Rs. 6,478. The claim for payment of Rs. 19,62,528 was disputed as the challans could not be verified by the jurisdictional officers. The Superintendent (AR) supported the disallowance, citing the appellant's failure to provide valid documentation. The Tribunal found the disallowance of Cenvat credit justified due to the lack of supporting evidence.Imposition of penalties:The adjudicating authority imposed penalties for evasion of duty, supported by the appellant's failure to deposit collected service tax. The Superintendent (AR) referenced legal precedents to justify the penalties. The Tribunal upheld the penalties, emphasizing the appellant's issuance of invoices for service tax but failure to deposit the amounts. The decision was based on the appellant's inability to prove payment and the intention to evade service tax.In conclusion, the Tribunal upheld the order, dismissing the appeal due to the lack of evidence supporting the appellant's claims and the legality of the confirmed service tax demand, disallowed Cenvat credit, and imposed penalties.