Issues: Whether proceedings for detention and penalty under GST could be sustained when the corrected tax invoice and e-way bill were produced before the detention or seizure order was passed.

Analysis: The goods were intercepted on the ground of mismatch in the accompanying documents, but the corrected invoice and e-way bill were produced before any detention or seizure order was passed. The authorities did not dispute that the discrepancy had been cured at that stage. The Court followed the earlier Division Bench view that once the proper documents are produced before the detention or seizure order, continuation of the proceedings is not justified.

Conclusion: The impugned orders were unsustainable and were set aside. The matter was remanded to the first appellate authority for fresh decision in accordance with law.

Issues: (i) Whether the addition made on account of cash deposits in bank accounts as unexplained cash credit was rightly deleted; (ii) whether the addition made on the basis of entries in Form 26AS was rightly deleted; (iii) whether the estimated addition for non-filing of return was rightly deleted.

Issue (i): Whether the addition made on account of cash deposits in bank accounts as unexplained cash credit was rightly deleted.

Analysis: The assessee maintained audited books of account and the cash deposits were linked to cash sales from its iron ore business. The remand proceedings did not reveal any material showing that the deposits came from an independent unexplained source. The cash sales were supported by books and VAT returns, and the lower appellate authority accepted the explanation after considering the remand report.

Conclusion: The deletion of the addition relating to cash deposits was upheld, in favour of the assessee.

Issue (ii): Whether the addition made on the basis of entries in Form 26AS was rightly deleted.

Analysis: The entries in Form 26AS reflected both tax deducted at source and tax collected at source. The assessed amount was not proved to be income of the assessee; part of it related to interest income already accounted for, and the balance related to purchases on which tax collected at source had been reflected by the suppliers. The distinction between TDS and TCS was material, and the revenue's treatment of the entire figure as income was found to be erroneous.

Conclusion: The deletion of the addition based on Form 26AS was upheld, in favour of the assessee.

Issue (iii): Whether the estimated addition for non-filing of return was rightly deleted.

Analysis: The assessee's books had been audited, the return was subsequently filed, and no defect in the books was pointed out in remand proceedings. In these circumstances, estimation of income merely because the return had not been filed in time was not justified.

Conclusion: The deletion of the estimated addition was upheld, in favour of the assessee.

Final Conclusion: The appellate order deleting all additions was affirmed and the revenue's appeal failed in full.

Ratio Decidendi: When audited books and supporting records substantiate the source of deposits and receipts, and the material in Form 26AS is shown to include tax collected at source rather than income, additions cannot be sustained merely on suspicion or on account of delayed or non-filing of the return.

Issues: (i) whether professional fees and engineering charges received from foreign entities were taxable as consulting engineer services; (ii) whether corporate cost allocation arising from seconded employees was chargeable to service tax; (iii) whether bank guarantee commission charges, software charges, repairs and maintenance charges, protective clothing charges, books and magazine subscription, insurance charges, relocation charges, school fees, salary reimbursements, demurrage charges, label dispenser charges, and miscellaneous foreign-currency expenses were taxable or required remand; and (iv) whether the extended period of limitation was rightly invoked.

Issue (i): whether professional fees and engineering charges received from foreign entities were taxable as consulting engineer services.

Analysis: The disputed engineering support was booked in the accounts during the relevant period and was received for use in business. The service was treated as consulting engineering service under the pre-2012 regime and remained taxable under the import-of-service rules for services received in India for business or commerce. The argument that the service was performed or consumed outside India was rejected on the facts found by the Tribunal.

Conclusion: The demand on professional fees and engineering charges was upheld in favour of Revenue.

Issue (ii): whether corporate cost allocation arising from seconded employees was chargeable to service tax.

Analysis: The assignment documents showed that effective control, remuneration structure, social security, duration, and termination rights remained with the foreign entity, while the Indian entity only received the benefit of the deputed personnel. On that basis, the arrangement was treated as an import of taxable consulting engineer service and the exclusion for employee services was held inapplicable. The Tribunal applied the principle that substance of the arrangement, not its label, determines taxability.

Conclusion: The demand on corporate cost allocation was upheld in favour of Revenue.

Issue (iii): whether bank guarantee commission charges, software charges, repairs and maintenance charges, protective clothing charges, books and magazine subscription, insurance charges, relocation charges, school fees, salary reimbursements, demurrage charges, label dispenser charges, and miscellaneous foreign-currency expenses were taxable or required remand.

Analysis: The Tribunal held that bank guarantee commission charges were not taxable on the facts noted, as the amount was only a reimbursement and no independent service consideration was established. Certain items, including bank charges, software charges, payment to government authorities, demurrage charges, and label dispenser purchases, were remanded because the evidentiary record was incomplete and the nature of the underlying transaction had to be re-examined from the invoices and supporting documents. Protective clothing, insurance charges, relocation charges, school fees, salary reimbursements, sundry expenses, conference and meeting expenses, and unreconcilable expenses were treated as part of the taxable value of the consulting service or as taxable foreign-currency expenses. Books and magazine subscription was held not taxable for the pre-1.7.2012 period and not taxable in India where the service was supplied from outside India.

Conclusion: The demand was set aside for bank guarantee commission charges and books and magazine subscription, sustained for the specified reimbursable and ancillary items, and remanded for bank charges, software charges, payment to government authorities, demurrage charges, and label dispenser charges.

Issue (iv): whether the extended period of limitation was rightly invoked.

Analysis: The Tribunal found suppression and misstatement in the manner the foreign-currency expenses were reflected and reconciled, and held that the discrepancies were not readily discoverable from a routine audit alone. On that basis, invocation of the extended limitation period was justified.

Conclusion: The extended period of limitation was upheld in favour of Revenue.

Final Conclusion: The appeal succeeded only in part, with some demands deleted, some sustained, and several items remanded for fresh adjudication on documentary verification.

Ratio Decidendi: Where seconded personnel remain under the effective control of the foreign entity and the arrangement in substance supplies taxable technical or consulting services to the Indian recipient, the reimbursement paid for such deputation is taxable service consideration under the service tax law.

Issues: (i) Whether waterfront royalty or wharfage charges collected under the Gujarat Maritime Board Act, 1981 were taxable as port service under the Finance Act, 1994. (ii) Whether the demand was barred by limitation and the extended period could be invoked.

Issue (i): Whether waterfront royalty or wharfage charges collected under the Gujarat Maritime Board Act, 1981 were taxable as port service under the Finance Act, 1994.

Analysis: The definition of port service applicable to the relevant period covered services rendered by a port or an authorised person in relation to vessel or goods. The waterfront royalty was found to be a statutory levy collected for permitting operation of port facilities, and not consideration for any service rendered by the appellant in relation to vessel or goods. The levy was treated as arising from a sovereign or statutory function, and the Board circular on statutory levies under public authority was applied. The earlier decision in the same controversy was also relied upon to hold that such charges do not amount to port service.

Conclusion: The charges were not taxable as port service and the demand on merits failed in favour of the assessee.

Issue (ii): Whether the demand was barred by limitation and the extended period could be invoked.

Analysis: The records showed repeated departmental audits and prior examination of the relevant financial material before issuance of the show cause notice. In that background, the ingredients of suppression, misstatement, fraud, or intent to evade were not established. Since the notice was issued beyond the normal limitation period, invocation of the extended period was unsustainable.

Conclusion: The demand was barred by limitation and the extended period was not invocable.

Final Conclusion: The impugned order confirming service tax, interest, and penalty was set aside and the appeal succeeded.

Ratio Decidendi: A statutory levy collected by a public authority in exercise of sovereign or statutory powers, without any service rendered in relation to vessel or goods, is not chargeable as port service; and the extended period of limitation cannot be invoked absent suppression or intent to evade where the material facts were already within departmental knowledge.

Issues: (i) Whether the assessee was entitled to full input tax credit on rice bran purchased for manufacture of rice bran oil under Section 13(1)(a) read with the Table and Section 13(3)(b) read with Explanation (iii) of the Uttar Pradesh Value Added Tax Act, 2008; (ii) Whether the expression "goods" in Section 13(1)(f) of the Uttar Pradesh Value Added Tax Act, 2008 is confined to taxable goods; (iii) Whether the decision in M.K. Agro Tech applied to the facts of the case.

Issue (i): Whether the assessee was entitled to full input tax credit on rice bran purchased for manufacture of rice bran oil under Section 13(1)(a) read with the Table and Section 13(3)(b) read with Explanation (iii) of the Uttar Pradesh Value Added Tax Act, 2008

Analysis: Section 13(1)(a) grants full input tax credit where taxable goods purchased within the State are used in the manufacture of taxable goods and the manufactured goods are sold within the State or in inter-State trade. Section 13(3)(b) introduces proportional restriction where exempt and non-VAT goods are produced in manufacture, but its operation is qualified by the exception for by-products or waste products. Explanation (iii) creates a deeming fiction that where exempt goods emerge as by-product or waste product during manufacture of taxable goods, the purchased goods are deemed to have been used in the manufacture of taxable goods. The scheme therefore protects full credit in a case where the exempt output is only a by-product of the taxable manufacture.

Conclusion: The assessee was entitled to full input tax credit and the restriction sought to be applied by the revenue was not sustainable.

Issue (ii): Whether the expression "goods" in Section 13(1)(f) of the Uttar Pradesh Value Added Tax Act, 2008 is confined to taxable goods

Analysis: Section 13(1)(f) was inserted to cap input tax credit where goods are resold, or goods manufactured by using such goods, are sold at a price below purchase cost or cost price. The provision uses the word "goods" without qualifying it as "taxable goods", while the Act elsewhere uses the qualifier expressly when intended. The amendment was meant to address low realisation cases and not to narrow the scope of "goods" so as to defeat the by-product fiction under Section 13(3)(b) and Explanation (iii). The definition of "goods" in Section 2(m) is broad and does not itself distinguish taxable from exempt goods.

Conclusion: The expression "goods" in Section 13(1)(f) is not confined to taxable goods.

Issue (iii): Whether the decision in M.K. Agro Tech applied to the facts of the case

Analysis: M.K. Agro Tech arose under the Karnataka Value Added Tax Act, 2003, which contained a materially different scheme dealing with partial rebate on sales of taxable and exempt goods and a specific apportionment mechanism in the rules. The Uttar Pradesh enactment instead contains a manufacture-based scheme and a deeming fiction in Explanation (iii) to Section 13. Because the statutory framework and trigger provisions are different, the Karnataka decision could not control the present dispute.

Conclusion: M.K. Agro Tech had no application to the present case.

Final Conclusion: The assessee succeeded on all substantial issues, the High Court's view was set aside, and the Tribunal's orders restoring full input tax credit were reinstated.

Ratio Decidendi: Where exempt goods emerge only as by-product or waste product in the manufacture of taxable goods, Explanation (iii) to Section 13 deems the purchased goods to have been used in the manufacture of taxable goods, and a later restriction provision cannot be read to nullify that deeming fiction absent clear legislative language.

Issues: Whether a writ petition under Articles 226 and 227 of the Constitution of India was maintainable to challenge an award of the Micro and Small Enterprises Facilitation Council when the Micro, Small and Medium Enterprises Development Act, 2006 provides a statutory challenge under Section 34 of the Arbitration and Conciliation Act, 1996 subject to the pre-deposit requirement under Section 19 of the Micro, Small and Medium Enterprises Development Act, 2006.

Analysis: Proceedings before the Facilitation Council under Section 18 of the Micro, Small and Medium Enterprises Development Act, 2006 are governed by the Arbitration and Conciliation Act, 1996, and a challenge to the resulting award lies under Section 34 of that Act. Section 19 imposes a mandatory pre-deposit of seventy-five per cent of the award amount as a condition for entertaining such a challenge. Resort to writ jurisdiction to avoid that statutory discipline would defeat the scheme and object of the special enactment. The merits of the limitation issue did not require adjudication once the writ petition was held to be not maintainable.

Conclusion: The writ petition was not maintainable, and the challenge to the Facilitation Council's award had to be pursued through the statutory remedy under Section 34 of the Arbitration and Conciliation Act, 1996, subject to Section 19 of the Micro, Small and Medium Enterprises Development Act, 2006.

Ratio Decidendi: Where a special statute provides a complete statutory mechanism for challenging an arbitral award and imposes a pre-deposit condition, writ jurisdiction cannot be invoked to bypass that statutory remedy.

Issues: (i) Whether the Central Complaints Committee could consider the second complaint dated 18.09.2012 in the disciplinary inquiry; (ii) Whether the Central Complaints Committee was vitiated by putting questions to witnesses and by conducting the examination-in-chief; (iii) Whether the findings were based on no evidence or mere conjectures and surmises; (iv) Whether the High Court erred in setting aside the penalty.

Issue (i): Whether the Central Complaints Committee could consider the second complaint dated 18.09.2012 in the disciplinary inquiry.

Analysis: The complaint mechanism under the standing order enabled an aggrieved person to approach the Complaints Committee and did not prohibit later or additional complaints. The second complaint was filed promptly after the Committee was constituted and before the first hearing. In disciplinary proceedings, the material need only have probative value, and the proper inquiry is whether any real prejudice was caused.

Conclusion: The Committee was entitled to consider the second complaint and no prejudice was shown to have been caused to the respondent.

Issue (ii): Whether the Central Complaints Committee was vitiated by putting questions to witnesses and by conducting the examination-in-chief.

Analysis: Under the disciplinary scheme, the Complaints Committee functions as the inquiring authority. The standing order and the inquiry framework permit a fair, thorough, and sensitive procedure, including controlled questioning of witnesses. The Committee was not required to remain a passive recorder, and its questioning of witnesses did not by itself offend natural justice.

Conclusion: The inquiry was not vitiated on that ground.

Issue (iii): Whether the findings were based on no evidence or mere conjectures and surmises.

Analysis: Judicial review in disciplinary matters is limited to the fairness of the process and whether there is some tangible evidence supporting the finding. The record contained oral evidence from several witnesses supporting the allegations of unwelcome conduct, repeated calls, visits, and work-related victimisation. The absence of call records on one aspect did not convert the entire case into one of no evidence.

Conclusion: The findings were supported by evidence and were not vitiated as being based on conjecture or surmise.

Issue (iv): Whether the High Court erred in setting aside the penalty.

Analysis: The High Court interfered on technical grounds without applying the governing principles of prejudice, the limited scope of judicial review, and the distinction between sufficiency and existence of evidence. The disciplinary finding of proved sexual harassment was sustainable on the record and the penalty imposed could not be invalidated on the grounds accepted by the High Court.

Conclusion: The High Court erred in law in setting aside the penalty.

Final Conclusion: The disciplinary action was restored and the challenge to it failed; the judgment of the High Court was set aside and the penalty against the respondent stood revived.

Ratio Decidendi: In disciplinary inquiries on sexual harassment, courts interfere only for procedural unfairness causing prejudice or where findings are unsupported by any evidence, and a complaints committee may consider timely additional complaints and actively question witnesses if the procedure remains fair.

Issue 1: Deduction u/s 80P(2)(d) for interest income from cooperative banks

The assessee, a cooperative housing society, filed returns for A.Y 2017-18 claiming a deduction u/s 80P(2)(d) amounting to Rs. 17,79,349 for interest income from cooperative banks. The Assessing Officer (AO) disallowed this deduction, interpreting that cooperative banks do not fall under the purview of "cooperative society" as referred to in Sec. 80P(2)(d) of the Act. Consequently, the interest income was taxed under "income from other sources," leading to an assessed total income of Rs. 17,79,350.

Issue 2: Applicability of judicial precedents regarding deduction u/s 80P(2)(d)

Aggrieved by the AO's decision, the assessee appealed to the CIT(A), who upheld the AO's order. The assessee then appealed to the ITAT. The ITAT considered various judicial precedents, including decisions from the Hon'ble Tribunal in similar cases and the recent judgment by the Hon'ble Supreme Court in Kerala State Cooperative Agricultural & Rural Development Bank Ltd Vs Assessing Officer (2023) 154 taxmann.com 305 (SC). The ITAT concluded that interest income derived by a cooperative society from its deposits with cooperative banks is eligible for deduction u/s 80P(2)(d). The Tribunal relied on multiple judicial decisions supporting this view, including those from the Hon'ble High Courts of Karnataka and Gujarat.

Conclusion:

The ITAT set aside the CIT(A)'s order and directed the AO to allow the deduction u/s 80P(2)(d) for the interest income received from cooperative banks. The grounds of appeal were allowed in favor of the assessee for all assessment years involved (A.Y 2017-18, 2018-19, 2019-20, and 2020-21).

Order Pronounced:

In the result, the four appeals filed by the assessee are allowed. Order pronounced in the open court on 06.11.2023.

Issues: Whether the prosecution could be permitted to recall a witness under Section 311 of the Code of Criminal Procedure, 1973 and produce a certificate under Section 65B of the Indian Evidence Act, 1872 at a later stage before the trial was over, where the electronic devices were already on record as primary evidence.

Analysis: The electronic devices seized in the case were already produced before the Trial Court and were treated as primary evidence. The certificate under Section 65B was sought only to satisfy the legal requirement for proving the CFSL report prepared from those devices. The Court applied the principle that a certificate is unnecessary when the original electronic record itself is produced, and relied on the settled position that non-production of the certificate is a curable defect. It further held that, so long as the trial is not over, the certificate may be produced at any stage if the court finds that no irreversible prejudice will be caused to the accused and the exercise serves the cause of justice.

Conclusion: The prosecution was entitled to recall the witness and produce the Section 65B certificate, and the refusal by the courts below was set aside in favour of the appellant.

Ratio Decidendi: A certificate under Section 65B of the Indian Evidence Act, 1872 may be permitted to be produced at any stage before the conclusion of trial, and a court may allow recall of a witness under Section 311 of the Code of Criminal Procedure, 1973 where doing so causes no irreversible prejudice and advances the search for truth.

ISSUES PRESENTED AND CONSIDERED

1. Whether goods imported and assessed by the importer under Customs Tariff Heading (CTH) 98.02, but challenged by the Department as falling under CTH 22.07, can be provisionally released pending adjudication under Section 110 of the Customs Act, 1962.

2. Whether classification under CTH 98.02 can be examined with reference to the subsequent use of imported goods by downstream buyers (e.g., for sanitizer or vaccine purposes) or must be determined as at the time and point of importation.

3. Whether unexplained delay and apparent back-dating in serving a seizure memo vitiates the Department's refusal to grant provisional release.

4. Whether the existence of an earlier unadjudicated show-cause notice (dated 28th July 2022) affecting prior bill(s) of entry precludes provisional release of a subsequent consignment assessed under the same heading.

ISSUE-WISE DETAILED ANALYSIS

Issue 1 - Provisional release under Section 110 (legal framework)

Legal framework: Section 110 of the Customs Act, 1962 permits provisional release of goods on execution of a bond to secure duty and consequential amounts pending adjudication.

Precedent Treatment: The judgment did not cite or apply any specific external precedents; relief was determined on statutory text and factual matrix.

Interpretation and reasoning: The Court treated Section 110 as enabling provisional release where goods are not prohibited and where adequate security can be furnished to protect revenue. The Court emphasised long-standing import practice by the importer and prior departmental acceptance of classification under CTH 98.02 as relevant factors weighing in favour of provisional release. The Court found the complaint of potential revenue risk insufficient to deny provisional release where duty had already been deposited and a bond could secure differential duty/consequential amounts.

Ratio vs. Obiter: Ratio - provisional release under Section 110 is appropriate where goods are not prohibited, importer is bona fide, classification dispute is unresolved, and security is provided to secure duty differential; Obiter - general observations on administrative conduct and demurrage avoidance.

Conclusion: Provisional release granted upon execution of bond to secure differential duty and consequential amounts, with departmental contentions kept open for adjudication.

Issue 2 - Temporal point of classification: import-time assessment vs subsequent use

Legal framework: Classification under the Customs Tariff is determined by the nature and description of goods at the time of importation and pursuant to tariff chapter notes and headings.

Precedent Treatment: No prior decisions were followed, distinguished, or overruled in the reasons; the Court relied on statutory scheme and accepted import-time assessment principle.

Interpretation and reasoning: The Court rejected the Department's contention that downstream use (by buyers) determining use in sanitizer, vaccine, etc., could alter classification assessed by the importer at import. The Court held that tariff classification is to be seen at the time of import by the importer; there is no condition in chapter 98 requiring that the importer guarantee the subsequent sole use of the goods in laboratories. The Court noted the imported packaging (500 ml bottles) and markings consistent with laboratory chemical usage as indicative of the character declared at import.

Ratio vs. Obiter: Ratio - classification must be assessed as at importation and cannot be overridden merely by evidence of subsequent use by purchasers absent other tariff provisions; Obiter - remarks on absence of specific chapter 98 condition imposing obligation on importer regarding subsequent use.

Conclusion: Subsequent use by buyers does not justify refusal of provisional release nor automatic reclassification where import-time description and packaging support classification under CTH 98.02.

Issue 3 - Effect of delay and apparent back-dating of seizure memo on refusal to release

Legal framework: Administrative fairness and probity in seizure/communication are relevant to relief under Article 226 and to decisions on provisional release; unexplained procedural irregularity may inform exercise of discretion.

Precedent Treatment: No authorities cited; determination made on facts and timing.

Interpretation and reasoning: The Court observed that the seizure memo bore an earlier date than its posting/receipt and that service occurred after the petition was filed and first listed, creating an unexplained delay. In this context the Court found substance in the petitioner's allegation of back-dating and held that such procedural irregularity undermined the Department's justification for withholding provisional release. The Court treated the seizure irregularity as a factor supporting grant of interim relief but did not adjudicate the legality of seizure itself.

Ratio vs. Obiter: Ratio - unexplained delay or irregularity in serving a seizure memo is a relevant factor in exercising discretion to grant provisional release; Obiter - observations on postal/tracking timings as evidentiary matter for credibility.

Conclusion: The unexplained delay in serving the seizure memo contributed to the conclusion that provisional release should be ordered on bond; the Department's conduct did not justify continued detention pending final adjudication.

Issue 4 - Impact of pending, unadjudicated show-cause notice on provisional release of later consignments

Legal framework: Pending show-cause notices give rise to dispute but do not ipso facto preclude provisional relief for subsequent consignments where statutory prerequisites for release are met.

Precedent Treatment: No authority applied; Court relied on established administrative principles and case-specific facts.

Interpretation and reasoning: The Court noted an earlier show-cause notice (28th July 2022) relating to prior bill(s) which remained unadjudicated; despite this, the Department had historically cleared imports under CTH 98.02. The Court held that absence of adjudication on prior entries does not automatically bar provisional release of a subsequent consignment where the importer is regular, duty has been paid, the goods are not prohibited, and security can be furnished. The Court explicitly kept all classification contentions open for adjudication, thereby preserving the Department's substantive remedies while granting interim relief.

Ratio vs. Obiter: Ratio - a pending unadjudicated show-cause notice regarding earlier entries does not, by itself, preclude provisional release of a subsequent import where statutory conditions for release are satisfied; Obiter - comments preserving departmental rights to adjudicate classification later.

Conclusion: Provisional release was ordered despite prior pending show-cause notice; substantive classification disputes to be resolved in appropriate proceedings.

Relief and Directions

Provisional release of the subject consignment ordered on execution of a bond to secure differential duty and consequential amounts; respondents directed to release goods within two weeks of bond execution; all classification issues left open for adjudication; no costs awarded.

Issues: (i) Whether payment of net present value and compensatory afforestation charges for diversion of forest land for mining constituted consideration for a declared service of tolerating an act under section 66E(e) read with section 65B of the Finance Act, 1994. (ii) Whether the demand of service tax, interest and penalty could be sustained, including invocation of the extended period.

Issue (i): Whether payment of net present value and compensatory afforestation charges for diversion of forest land for mining constituted consideration for a declared service of tolerating an act under section 66E(e) read with section 65B of the Finance Act, 1994.

Analysis: The charges were payable by operation of law for diversion of forest land under the forest conservation regime and not pursuant to any voluntary arrangement by which the Government agreed to tolerate an act or situation for a consideration. The payment was a statutory levy aimed at environmental protection and ecological regeneration, and not a quid pro quo for any service rendered by the Government to the appellant. The ingredients of a service, namely activity for another for consideration, and of declared service by agreeing to tolerate an act, were therefore absent.

Conclusion: The payment did not amount to consideration for a declared service and no service tax was payable on that count.

Issue (ii): Whether the demand of service tax, interest and penalty could be sustained, including invocation of the extended period.

Analysis: Since the levy itself was not maintainable, the consequential demand of interest and penalty could not survive. The payment had been made openly in accordance with law, with no suppression of facts established on the record. In the absence of suppression, the extended period was not available and penalty under section 78 could not be imposed.

Conclusion: The demand of service tax, interest and penalty was unsustainable and the extended period could not be invoked.

Final Conclusion: The appeal succeeded and the impugned order was set aside in full, leaving no service tax liability on the disputed statutory payments.

Ratio Decidendi: A statutory payment made by operation of law for environmental clearance and forest diversion cannot be treated as consideration for tolerating an act under the service tax law, and without suppression of facts the extended period and penalty cannot be invoked.