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2025 (2) TMI 896

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....d into three divisions, viz., 'product division' for sale of goods, 'service division' for installation and maintenance contracts and 'project division' for execution of turnkey projects. On the basis of 'third party data', a generic description for information supplied/gathered from other agencies of government, which, in this case, was the income tax authority concerned, it was determined that, for financial year 2015-16, turnover of services, reported as Rs. 9,34,31,708, appeared to be erroneous inasmuch as the return to the other authority indicated turnover of Rs. 41,93,95,586/-. Repeated enquiries between January 2020 and December 2020 emanating from the jurisdictional authorities administering the remnants of proceedings under the er....

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....ervice on which tax liability had been discharged on the service component, had been duly furnished as also discharge of tax liability under VAT regime of the respective state governments along with the reconciliation for exclusion of value of goods / components to the extent Rs. 38,17,59,208 (comprising 4,57,14,791 by 'product division', Rs. 6,33,265 by the 'service division' and Rs. 3,35,41,152 by the 'project division') but that the adjudicating authority remained unconvinced. He, therefore, submitted that the disposal of show cause notice was erroneous and, thereby, not consistent with the law as set out by the Tribunal in GD Goenka Pvt Ltd v. Commissioner of Central Excise & Service Tax [(2023) 11 Centax 2 (Tri.-Del.)]. Likewise, it wa....

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....hat they appeared to have taken the investigations seriously only after issue of show cause notice. It is also clear from the records that the reconciliation of the two statutory records had been furnished despite which the adjudicating authority preferred to give credence to the filing which appeared to favour recovery of indirect tax without examining the records. This is apparent from '14. It is seen that the noticee have declared total Operational Service Income of Rs.41,93,95,586/- in their ITR, whereas they have declared gross income of Rs. 9,32,96,708/- in their ST3 returns for FY 7015-16, thus it is seen that there is a difference of Rs. 32,60,98,878/-. Towards the difference of Rs. 32,60,98,878/- the noticee in their submissions ....

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....ce income amounting to Rs. 41,93,95,586/- in their statutory records, whereas they have only declared service income of Rs. 9,32,96,708/- in their ST3 returns for FY 2015-16, giving rise to difference of Rs. 32,60,98,878/-. I find that the noticee have failed to substantiate the difference of Rs. 32,60,98,878/- arising between the declared turnover of Rs.41,93,95,586/- in their Income Tax Return (ITR) and the income of Rs. 9,32,96,708/- declared in their Service Tax return for the Financial year 2015-16. 17. Thus, I find that the noticee have failed to declare the differential income of Rs.32,60,98,878/- arising from rendering taxable service in their ST3 returns on which they are liable to pay service tax @ 14.5% amounting to Rs 4,72,84,....