TaxTMI 
TaxTMI 
2024 (6) TMI 771
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....rns filed by them for the said period. Therefore, on the differential amount of Rs.7,19,93,389/-, service tax of Rs.88,98,383/- @ 12.36% was short paid by the appellant. Therefore, by invoking proviso to sub-section (1) of Section 73 of Finance Act, 1994 for extended period of limitation, appellant was called upon to show cause as to why short paid service tax amounting to Rs.88,98,383/- should not be recovered from them. Appellant was also called upon to show cause as to why they should not pay interest on the said short paid service tax and why they should not be imposed with penalty under Section 78 of Finance Act, 1994. At the end of the show cause notice, there is no list of documents based on which the said show cause notice was relied upon. Appellant vide letter dated 17.09.2020 submitted copy of balance sheet, profit and loss account and copies of ST-3 returns filed for the period from April 2013 to March 2014. Appellant submitted their submissions on 24.12.2020 during personal hearing along with copy of sale/purchase summary, copy of party ledgers, copy of service tax paid challans etc. The said show cause notice was adjudicated through order-in-original dated 27.03.2021 i....
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....in the show cause notice. He has submitted that the present show cause notice is issued in violation of the said instructions. He has further submitted that there are standing instructions for preconsultation with the appellant by the officers of Revenue before issue of show cause notice and the said procedure was also not followed. He has relied on following precedent decisions of this Tribunal:- a. Umesh Tilak Yadav (2024) 159 taxmann.com 336 (Mumbai-CESTAT) b. Commissioner vs. Modern Road Makers Pvt. Ltd. (Appeal No. ST/86984/2021) c. Principal Commissioner vs. SBI Life Insurance Co. Ltd. [2024] 159 taxmann.com 168. d. Lord Krishna Real Infra Pvt. Ltd. 2019 (2) TMI 1563 - CESTAT All. e. Sharma Fabricators & Erectors P Ltd. 2017 (7) TMI 168 - CESTAT All. f. Kush Construction 2019 (5) TMI 1248 - CESTAT All. Learned counsel has submitted that it is no more res integra that only on the basis of difference between figures reflected in ST-3 return and the income reflected in income tax return, demand of service tax on differential value cannot be determined unless the assessee's records are scrutinized and on the basis of the ac....
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....ivities which are mentioned in the definition of service as those which are not covered by such definition becomes important. Therefore, we come to a conclusion that for arriving at amount of service tax not paid or not levied arriving at correct value of taxable service which has not suffered service tax needs to be determined as the first step. 6. Now we will examine the second issue at B above. We note that without examination of any of the records of the appellant on the basis of data received from outside source, Revenue has come to a conclusion that taxable value of Rs.7,19,93,389/- for the period from October 2013 to March 2014 has not been subjected to payment of service tax. In the said show cause notice, no evidence has been brought forward to establish that the said taxable value of Rs.7,19,93,389/- is consideration received for providing service. We examine further the charges levelled as stated above are sustainable or not. We will examine them with reference to the precedent decisions of this Tribunal relied upon by learned counsel for the appellant. For the sake of ready reference, we reproduce below para 4 of final order of this Tribunal in the case of Umesh Tila....
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....ice was issued without examining the activity of the respondent and without examining the reason for difference in turnover reported in income tax return and ST-3 return. It was presumed in the show cause notice that the entire turnover reported in income tax return was on account of provision of taxable service and by calculating 12.36% of that turnover, service tax demand was raised. The fundamentals of prosecution such as framing charges on the basis of admissible evidence is absent in issue of show cause notice. The basic of any proceeding is to frame charges on the basis of assessee's record and establish that the assesse has short paid calculated and pre-determined amount of service tax and then issue them a show cause notice calling for their explanation as to why the stated amount of service tax should not be recovered from them. The burden of proof is on Revenue to establish that the alleged service tax was short paid by the assesse. Unless such burden of proof is discharged by Revenue, such show cause notice cannot sustain. The preset show cause notice is totally presumptive. Further, the difference in turnover in ST-3 return and income tax return could be on account of n....
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.... the said Show Couse Notices are not sustainable, appeal bearing No.ST/890/2010 filed by M/s Sharma is allowed and appeal bearing No. ST/949/2010 filed by Revenue is dismissed. Miscellaneous Applications are also stand disposed of. Cross Objection also disposed of." C) In the case of Kush Constructions [2019 (5) TMI 1248 - CESTAT ALLAHABAD], it was held as follows:- "After hearing both the sides duly represented by Shri A.K. Singh authorized representative of the appellant on behalf of the appellant and Shri Shiv Pratap Singh learned A.R. on behalf of the Revenue, we note that through impugned order service tax of Rs.93,000/- was confirmed alongwith equal penalty. On perusal of record, we note that the appellants were registered with the Service Tax Department and also they were filing ST-3 returns. Revenue has compared the figures reflected in the ST-3 returns and those reflected in Form 26AS filed in respect of the appellant as required under the provisions of Income Tax Act, 1961. We note that without further examining the reasons for difference in two, Revenue has raised the demand on the basis of difference between the two. We note that Revenue cannot raise t....
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....sions of sub-section (1) of Section 73 of Finance Act, 1994. The said provision of Finance Act empowers Revenue for recovery of service tax which has not been levied or which has not been paid or which has been short levied or which has been short paid or which has been erroneously refunded. Therefore, the first step for Revenue is to establish that a specific amount to be demanded through show cause notice by invoking the said provision is service tax either not paid or short paid or not levied or short levied. Therefore, it is essential to establish that the value on which such service tax is calculated is the value under Section 67 and the same is derived from the consideration received by the appellant out of the activity which has to satisfy definition of service under sub-section (44) of Section 65B of Finance Act, 1994. Such type of examination of the facts and arriving at the prima facie view that the appellant had received the consideration by providing service is missing in the show cause notice. We, therefore, hold that the said show cause notice dated 26.06.2020 is not sustainable in law 8. Hence, in view of irregularity in the Show cause and the nonsustainabil....