Service tax demand based only on Form 26AS data fails without corroborative proof of taxable services.

Service tax liability could not be sustained on Form 26AS and CBDT income-tax data alone, where there was no independent corroborative evidence establishing that the receipts represented taxable services. The record also indicated material identifying the appellant as proprietor of the concern, weakening the basis for the demand. On the same factual foundation, the extended period of limitation under section 73 of the Finance Act, 1994 was also held to be unavailable, because third-party income-tax data without proper verification could not justify extended limitation. The confirmed demand was set aside and consequential relief followed.

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Issues: (i) Whether service tax demand could be sustained solely on the basis of Form 26AS and CBDT data without corroborative evidence of taxable services; (ii) Whether the extended period of limitation under section 73 of the Finance Act, 1994 was invokable on the facts.

Issue (i): Whether service tax demand could be sustained solely on the basis of Form 26AS and CBDT data without corroborative evidence of taxable services.

Analysis: The demand was founded on information reflected in Form 26AS and the appellant also placed material showing that the receipts related to Aditya Enterprise, of which he was the proprietor. The order records that the confirmation below rested on the absence of records to establish proprietorship, but the appellate record contained a certified statement of assets and liabilities identifying the appellant as proprietor. The Tribunal also followed the settled view that mere entries in income-tax data or Form 26AS, without independent or corroborative evidence of taxable service, do not by themselves establish service tax liability.

Conclusion: The demand could not be sustained on the sole basis of Form 26AS and CBDT data, and the confirmed demand was liable to be set aside.

Issue (ii): Whether the extended period of limitation under section 73 of the Finance Act, 1994 was invokable on the facts.

Analysis: In light of the basis of the notice and the absence of corroborative evidence linking the alleged receipts to taxable service, the invocation of the extended period was not supported. The Tribunal followed the line of authorities holding that proceedings founded only on third-party income-tax data and without proper verification cannot justify extended limitation.

Conclusion: The extended period of limitation was not invokable.

Final Conclusion: The impugned order was set aside and the appeal was allowed with consequential relief as per law.

Ratio Decidendi: A service tax demand cannot be sustained, and the extended period cannot be invoked, when the proceedings rest solely on income-tax/Form 26AS data without corroborative evidence establishing taxable service.

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