TaxTMI 
TaxTMI 
2025 (7) TMI 634
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....od of October 2014 to March 2015 as discussed above and pass a fresh order after considering and taking into account all the submissions of the appellant, after giving opportunity of being heard to the appellant. The appellant is also directed to submit copies of all the relevant relied upon documents before the adjudicating authority when the case is posted for hearing and decision." 2.1 The Appellant was registered with the Service Tax Department having Service Tax Registration No. AACCH0076JST001 for providing the taxable services defined under erstwhile Section 65B(44) of the erstwhile Finance Act, 1994. 2.2 On scrutiny of third party data, which was received from the Income Tax Department for the F. Y. 2014-15, the Respondent-Department observed difference between the values of sale of services declared in their Income Tax Return (ITR data), values for TDS (TDS data) and Total Gross value provided in Service Tax Returns (STR data). The details of the said difference is under:- Financial Year (Rate of Service Tax) Total amount paid / credited under Section 194C, 194H, 1941, 194J as per 26AS Gross value of services provided (as per STR) Difference between value....
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....ection 78 of the Finance Act, 1994 read with Section 142, Section 173 and Section 174 of the CGST Act, 2017. If duty as confirmed at (1) above, interest and penalty paid within 30 days of receipt of this order then penalty amount stands reduced to 25%. IV) I impose a penalty of Rs.10,000/- (Rupees Ten Thousand only) upon M/s Digilife Distribution and Marketing Services Limited under Section 77(1)(c) of the Finance Act, 1994 read with Section 142, Section 173 and Section 174 of the CGST Act, 2017 and also order for recovery of the same from the noticee. 2.5 Aggrieved Appellant has filed the appeal before the Commissioner Appeals who has modified the Order-In-Original by the impugned order as indicated in Para 1 above. 2.6 Aggrieved Appellant is before the Tribunal. 3.1 I have heard Shri Nikhil Gupta learned Advocate for the Appellant and Shri Santosh Kumar, learned Authorized Representative for the Revenue. 3.2 Arguing for the Appellant learned Counsel submits that • the Commissioner (Appeals) have held demand for the first half year of the Financial Year 2014-15 to be barred by limitation and for the remaining half year he has remanded the matter h....
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....oresaid, I find that in the case of evasion of service tax by way of fraud, collusion, willful misstatement and suppression of facts, provisions of extended period as provided under Section 73(1) of the Act are applicable. 8.2 In the above context, I rely on the case of Cosmic Dye Chemical Vs. Collector 1995 (75) ELT 721 (S.C.)-"the Hon'ble apex Court held that the intent to evade duty must be proved for invoking extended period of limitation." In this case as discussed supra the appellant suppress the fact with intent to evade the service tax. In the case of Anand Nishikawa Company Ltd. Vs. Commissioner, Meerut 2005 (188) ELT 149 (S.C.), the Hon'ble Supreme Court has held that "suppression of facts can have only one meaning that the correct information was not disclosed deliberately to evade the payment of duty." In the case of M/s. Lalit Enterprises [2010 (17) STR 370 (Tri Chennai)], it was held that in the light of the fact that on verification of the records the Department came to know-" that the appellants did not disclose receipt of service charges, therefore, five years period has been correctly invoked and applied against the appellant as the case falls wit....
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.... 1996, Section 12A of the Commercial Courts Act, 2015 and provisos (b) and (c) of Section 138 of the Negotiable Instruments Act, 1881 and any other laws, which prescribe period(s) of limitation for instituting proceedings, outer limits (within which the court or tribunal can condone delay) and termination of proceedings. We have passed this order in exercise of our powers under Article 142 read with Article 141 of the Constitution of India. Hence it shall be a binding order within the meaning of Article 141 on all Courts/Tribunals and Authorities." I also find that the matter of extension of period of limitation under Section 168A of the CGST Act, 2017 was deliberated in the 43rd Meeting of GST Council, while providing various relaxations in the compliances for taxpayers, also recommended that wherever the timelines for actions have been extended by the Hon'ble Supreme Court, the same would apply. In this context the CBIC vide Circular No. 157/13/2021-GST dated 20/07/2021 on the subject matter of limitations of time lines under GST Law, has clarified the following:- (ii) For the purpose of counting the period(s) of limitation for filing of appeals before any a....
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.... limitation of five years is invokable in this case. Therefore, proviso to Section 73(1) of the Finance Act, 1994 along with Section 75 of the Act for appropriate interest read with Section 142and Section 174 of CGST Act, 2017 is invokable in this case." 4.5 Hon'ble Supreme Court has in case of Uniworth Textiles Ltd. [2013 (288) E.L.T. 161 (S.C.)] held as follows: 12. We have heard both sides, Mr. R.P. Bhatt, learned senior counsel, appearing on behalf of the appellant, and Mr. Mukul Gupta, learned senior counsel appearing on behalf of the Revenue. We are not convinced by the reasoning of the Tribunal. The conclusion that mere non-payment of duties is equivalent to collusion or willful misstatement or suppression of facts is, in our opinion, untenable. If that were to be true, we fail to understand which form of non-payment would amount to ordinary default? Construing mere non-payment as any of the three categories contemplated by the proviso would leave no situation for which, a limitation period of six months may apply. In our opinion, the main body of the Section, in fact, contemplates ordinary default in payment of duties and leaves cases of collusion or willful mis....
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....er section 11A(1) of the Central Excise Act, 1944, a proper officer can reopen the approvals/assessments in cases of escapement of duty on account of non-levy, non-payment, short-levy, short-payment or erroneous refund, subject to it being done within one year from the relevant date. On the other hand, the demand for duty in relation to extended period is mentioned in the proviso to section 11A(1). Under that proviso, in cases where excise duty has not been levied or paid or has been short-levied or short-paid or erroneously refunded on account of fraud, collusion or wilful mis-statement or suppression of facts, or in contravention of any provision of the Act or Rules with the intent to evade payment of duty, demand can be made within five years from the relevant date. In the present case, we are concerned with the proviso to section 11A(1). 24. In the case of Cosmic Dye Chemical v. Collector of Central Excise, Bombay (1995) 6 SCC 117, this Court held that intention to evade duty must be proved for invoking the proviso to section 11A(1) for extended period of limitation. It has been further held that intent to evade duty is built into the expression "fraud and collusion" b....
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....m the side of the assessee to find willful suppression. Therefore, in view of our findings made herein above that there was no deliberate intention on the part of the appellant not to disclose the correct information or to evade payment of duty, it was not open to the Central Excise Officer to proceed to recover duties in the manner indicated in the proviso to Section 11A of the Act." 16. In Collector of Central Excise v. H.M.M. Ltd. - 1995 Supp (3) SCC 322 = 1995 (76) E.L.T. 497 (S.C.), this Court held that mere non-disclosure of certain items assessable to duty does not tantamount to the mala fides elucidated in the proviso to Section 11A(1) of the Central Excise Act, 1944. It enunciated the principle in the following way :- "The mere non-declaration of the waste/by-product in their classification list cannot establish any wilful withholding of vital information for the purpose of evasion of excise duty due on the said product. There could be, counsel contended, bona fide belief on the part of the assessee that the said waste or by-product did not attract excise duty and hence it may not have been included in their classification list. But that per se cannot go ....
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.... the period of limitation for issuing a show-cause notice in the case of non-levy or short-levy to five years from a normal period of six months... 54. While interpreting the said provision in each of the aforesaid cases, it was observed by this Court that for proviso to Section 11-A to be invoked, the intention to evade payment of duty must be shown. This has been clearly brought out in Cosmic Dye Chemical case where the Tribunal had held that so far as fraud, suppression or misstatement of facts was concerned the question of intent was immaterial. While disagreeing with the aforesaid interpretation this Court at p. 119 observed as follows : (SCC para 6) '6. Now so far as fraud and collusion are concerned, it is evident that the requisite intent, i.e., intent to evade duty is built into these very words. So far as misstatement or suppression of facts are concerned, they are clearly qualified by the word 'wilful' preceding the words 'misstatement or suppression of facts' which means with intent to evade duty. The next set of words 'contravention of any of the provisions of this Act or Rules' are again qualified by the immediately following words 'with intent to ev....
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.... Aban Loyd Chiles Offshore Limited and Ors. v. Commissioner of Customs, Maharashtra - (2006) 6 SCC 482 = 2006 (200) E.L.T. 370 (S.C.) observed :- "The proviso to Section 28(1) can be invoked where the payment of duty has escaped by reason of collusion or any willful misstatement or suppression of facts. So far as "misstatement or suppression of facts" are concerned, they are qualified by the word "willful". The word "willful" preceding the words "misstatement or suppression of facts" clearly spells out that there has to be an intention on the part of the assessee to evade the duty." 21. The Revenue contended that of the three categories, the conduct of the appellant falls under the case of "willful misstatement" and pointed to the use of the word "misutilizing" in the following statement found in the order of the Commissioner of Customs, Raipur in furtherance of its claim : "The noticee procured 742.51 kl of furnace oil valued at Rs. 54,57,357/- without payment of customs duty by misutilizing the facility available to them under Notification No. 53/97-Cus., dated 3-6-1997" 22. We are not persuaded to agree that this observation by the Commissione....
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....shing mala fides is very heavy on the person who alleges it. The allegations of mala fides are often more easily made than proved, and the very seriousness of such allegations demand proof of a high order of credibility." 25. Moreover, this Court, through a catena of decisions, has held that the proviso to Section 28 of the Act finds application only when specific and explicit averments challenging the fides of the conduct of the assessee are made in the show cause notice, a requirement that the show cause notice in the present case fails to meet. In Aban Loyd Chiles Offshore Limited and Ors. (supra), this Court made the following observations : "21. This Court while interpreting Section 11-A of the Central Excise Act in Collector of Central Excise v. H.M.M. Ltd. (supra) has observed that in order to attract the proviso to Section 11-A(1) it must be shown that the excise duty escaped by reason of fraud, collusion or willful misstatement of suppression of fact with intent to evade the payment of duty. It has been observed : '...Therefore, in order to attract the proviso to Section 11-A(1) it must be alleged in the show-cause notice that the duty of excise ....
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.... Gupta [Final Order No 59773-59774/2024 dated 4.12.2024 in ST/50544, 51815/2017] following has been observed by Delhi Bench: "31. What, therefore, transpires from the aforesaid decisions is that there can be a difference of opinion between the department and an assessee. An assessee may genuinely believe that duty is not leviable, while the department may believe that duty is leviable. The assessee may, therefore, not pay duty in the self-assessment carried out by the assessee, but this would not mean that the assessee has wilfully suppressed facts. To invoke the extended period of limitation, atleast one of the five necessary elements must be established and their existence cannot be presumed merely because the assessee is operating under self assessment. If some duty escapes assessment, the officers of the department can always call upon the assessee to submit further documents and he may also conduct an enquiry. In fact when an audit is conducted, the officers of the audit team scrutinize the records and, therefore, notice should be issued within the stipulated time from the date the audit was conducted. Even otherwise, merely because facts came to light only during the....