TaxTMI 
TaxTMI 
2013 (12) TMI 1495
X X X X Extracts X X X X
X X X X Extracts X X X X
....of 75 per cent. of the contract value on the ground that the value of the goods supplied under the annual maintenance contract is only 10 per cent. 2. The assessee is engaged in the business of sale of computer hardware and software and registered under the VAT Act. They also provide consulting services to various plants and annual maintenance contract. In relation to these AMC services, the assessee has discharged service tax on 90 per cent. of such AMC turnover. The assessee has charged VAT on the applicable rate of 10 per cent. on 10 per cent. of the AMC turnover. The service is rendered by the assessee on all India basis by filing the income tax returns in terms of the Finance Act. For the assessment year 2006-07, the assessee ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ssessing authority, after looking into the entire material produced before him, was of the view that out of the total turnover, 10 per cent. of the turnover represents the value of the goods supplied and sold and therefore, he levied a VAT on 10 per cent. of turnover. Accordingly, accepting the said order, the assessee has been paying taxes on 10 per cent. of the turnover under the VAT Act and 90 per cent. of the turnover as service tax. Even for the year 2006-07, he had paid the tax accordingly. It is in that context, three proposition notices were issued. The assessee replied and produced all the materials, but still, not being satisfied, now the authorities have come to the conclusion that 75 per cent. of the total turnover represents th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the orders were passed in the reassessment proceedings, where 10 per cent. was held to be the value of the goods supplied, they accepted the said finding and they are paying a VAT on 10 per cent. and service tax on 90 per cent. Now, the authorities issued proposition notices, three in number, to the assessee, for which, reply has been given and all documents produced. However, they have issued notices to the customers and on the basis of the socalled information collected from them, they have come to the conclusion that the total value of the goods supplied is 75 per cent. The said material collected by the customers is not put to the assessee nor given any opportunity to cross-examine them and in the orders also, we do not find any referen....
X X X X Extracts X X X X
X X X X Extracts X X X X
....certainly by giving cogent reasons based on the legal evidence, it is open to the assessing authority to do so. But, before deviating from the old practice, it is now well established that there should be material to show the justification for deviating from the past practice and should also be based on the legal evidence. In the instant case, though the authority has collected material from the customer, the same is not reflected in the order and the said material is not put to assessee and the say of the assessee is not obtained and therefore, that material cannot be acted upon. The proper course would be to furnish the statements of all the customers to the assessee and have the say of the assessee in the matter and if it makes a request....