TaxTMI 
TaxTMI 
2019 (11) TMI 1207
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....yment of service tax with interest and further imposition of penalty of equal amount of tax under Sections 77 and 78 of the Finance Act, 1994 (hereinafter referred to as 'the Act of 1994'). 2. Appellant-M/s. Chhattisgarh Steel Castings (P) Ltd. is having service tax registration No.ST/JML-/332/CSCPL/ GTA/2005 as appellant being liable to pay service tax on 'Transportation of Goods by Road' as goods transport agency being recipient of service and also registered under the category of 'Business Auxiliary Service' as provider of service. The main business of appellant was of steel casting and other collateral smelting industries. 3. During the course of audit of the accounts of appellantnoticee, it revealed that income shown in balance sheet for the year 2006-07 under the head of 'income' of Rs. 2,67,98,881/- and similarly for the year 2005-06 under the head of 'other income', it has been shown as Rs. 2,87,72,791/-. In the balance sheet under the head of 'other income' during the year 2006-07, they have also shown income of Rs. 1,84,86,132/- and during the year 2005-06, Rs. 2,50,00,000/-. On query being made by the Authority, it was ....
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....e appellant as to why the service tax cannot be imposed on him for engaging himself in service of a "Real Estate Agent" during the year 2005-06 and 2006-07. The appellant did not reply to notice and on being given personal hearing after seeking several dates, one Chartered Accountant appeared on his behalf, in which, he raised a defence that income has been shown in the books of account of the appellant; the accounts have been produced before the authorities, therefore, there was no question of suppression of facts. He submitted that period of assessment is of 2005-06 and 2006-07 whereas show cause notice has been issued on 22/01/2010, therefore, the notice is barred by limitation and the noticee is nowhere involved in any activities of nature bringing him within the definition of "Real Estate Agent". The appellant dealt with purchase and sale of land only in the capacity of 'buyer and seller' and hence, there cannot be any service tax liability on the noticee. The demand itself does not survive on merit and limitation, therefore, there is no occasion for imposition of penalty. 6. The Adjudicating Authority after taking into consideration the material available before it ....
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....g Officer had wrongly invoked the extended period of limitation for issuance of notice; though the alleged transaction for the year 2005-06 and 2006-07 and notices have been issued only in the year 2010; the Revenue failed to prove that appellant was aware of its liability for payment of service tax as "Real Estate Agent" or he deliberately and willfully suppressed the payment of service tax for evading tax, therefore, there was no question for invoking extended period of limitation. In view of aforementioned arguments, he submitted that as non-payment of service tax was not intentional or willful, no penalty can be imposed under the Act of 1994. He further submitted that the appellant entered into an agreement for purchase of land at village Chorhata in District Rewa (M.P.) and the property was being purchased for the purpose of extension of its industry, therefore, there was no occasion for him to enter into the business of real estate and to provide service of Real Estate Agent. He lastly submitted that the service tax with interest has already been deposited and he is only challenging the imposition of penalty. 11. Learned counsel for the appellant relied upon the judgments p....
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....ted that act of appellant cannot be said to be simple purchase and sale of the land. He further submitted that aforementioned income earned by the appellant comes within the purview of definition of "Real Estate Agent" and he supported the impugned order passed by the CESTAT. 13. We have heard learned counsel appearing for both the parties. 14. Before proceeding with the case, it will be beneficial to have a glance of some of the relevant definitions as provided under the Act of 1994. Sections 65(88), 65(89) and 65(105)(v) of the Act of 1994 reads as under :- "65(88) Real Estate Agent- A person engaged in rendering any service in relation to sale, purchase, leasing, renting of a real estate and includes a real estate consultant. 65(89) Real Estate Consultant- A person who renders in any manner, either directly or indirectly advice consultancy or technical assistance in relation to evaluation, conception, design, development, construction, implementation, supervision, maintenance, marketing, acquisition or management of real estate. 65(105)(v) Taxable Service- Any service provided or to be provided to any person, by a real estate agent in relation to real estate." 15. Fr....
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.... Department that there was suppression of facts. The liability of payment of income tax and service tax are two different and separate statutory liability to be discharged by the persons engaged in business. The appellant who is already registered under the service tax for 'transportation of Goods by Road' as well as 'Business Auxiliary Service', therefore, it cannot be said that appellant was not aware about the liability of payment of service tax on the income so received from the transactions, which make's him liable for payment of service tax. The appellant did not get himself registered as a "Real Estate Agent" and paid service tax on the amount of income received by him. 19. The act of appellant clearly shows that he suppressed the facts, therefore, the period of limitation is to be counted from the date of knowledge of the Departmental Authority as provided under sub-section 3(ii) of Section 11A of the Act of 1944. The word "suppression of facts" has been dealt with by the Hon'ble Supreme Court in the matter of Pushpam Pharmaceuticals Company v. Collector of Central Excise, Bombay reported in 1995 Supp (3) SCC 462. 20. The Adjudicating Authority h....
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....tatute - No canon of interpretation permits exercise of rewriting statutory provision. Appellate Tribunal's order-Demand-Limitation -Extended period- knowledge of Department, effect-Tribunal introduced novel concept of date of knowledge and imported into proviso to Section 11A(1) of Central Excise Act, 1944, a new period of limitation of six months from date of knowledge-Reasoning that once knowledge acquired, there is no suppression, fallacious as merely because Department acquires knowledge, suppression not obliterated - Tribunal order contrary to provisions of Section 11A ibid and not sustainable - Order quashed and set aside. 17.2 Further the Hon'ble Supreme Court in the case of CCE Visakhapatnam vs. Mehta & Co. reported in [2011 (264) ELT 481 (SC)] held that "Demand-Limitation-Relevant date for computation of extended period for show cause notice - Cause of action is date of knowledge- Department came to know of manufacture of furniture from information provided by buyer in 1997-Date of knowledge is attributable to 1997- Reply sent by respondent on 27/02/1997 for letter from Department-Limitation if computed from such date, show cause notice issued on 15/05/2000 ....
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....by the Noticee during the year 2006-07 for services as above is Rs. 19,80,609/- as a Real Estate Agent as detailed in pre-paras. The Noticee evaded the payment of service tax by suppressing of facts and done in contravention of the Rule 6 and 7 of the Service Tax Rules, 1994 and Section 70 and Section 68 of the Finance Act, 1994. They had not taken registration under the Category of a Real Estate Agent as provided under Rule 4 of the Service Tax Rules, 1994 read with Section 69 of the Finance Act, 1994. They also had not filed S.T.-3 returns under Rule 7 read with Section 70 of the Finance Act, 1994 towards services of real estate agent. Therefore, they are liable for penal action under Section 77 and 78 of the Finance Act, 1994." 23. The finding recorded by the Assessing Officer for imposition of penalty under Sections 77 and 78 of the Act of 1994 has been affirmed by the Appellate Authority as well as the CESTAT. We are of the considered view that there is no error or infirmity in the said findings recorded by the Assessing Officer and affirmed by the Appellate Authority and the CESTAT. 24. On a specific query made by this Court, the appellant placed on record the minutes of ....