TaxTMI 
TaxTMI 
2025 (8) TMI 92
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.... in their annual returns filed under Income Tax Act for the FY 2016-17 and the amount declared in their ST3 Return filed for the same period. Similar differences were also noticed for the period 2017-18. The department, thereafter, called for certain information/clarification from the appellant, however, the appellant, according to the department, did not furnish the relevant documents. However, in terms of Board's policy vide the circular dt.10.03.2017, an opportunity for pre-notice consultation was given to the appellant on 30.09.2021, where they claimed benefit under certain notification i.e., 25/2012 in relation to services provided to various recipients and applicable abatement also. They also submitted the contracts executed with their service recipient and the related invoices. However, the SCN issuing authority felt that the said exemption and abatement claimed by the appellant were not verifiable based on partial documents submitted on record and it was also observed that issue of SCN is the first step in dispute resolution process and noticee would have ample opportunities to present their case in case they wish to establish that incomes declared in Income Tax Returns are....
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....ract, which was post 01.03.2015 and therefore, the said provision would not be applicable. 6. Learned Advocate for the appellant has mainly contested on the grounds that the department has raised the SCN merely based on third party information and has not carried out any independent investigation to arrive at the conclusion as to whether they were providing any taxable service or otherwise. Notwithstanding this submission, he has also submitted that on merits also, they had clearly explained that they have already paid certain service tax in respect of certain contracts and have not paid certain service tax assuming that these were non-taxable service being covered under notification 25/2012. He has further submitted that in respect of agreement from S.No.1 to 8 and from S.No.15 to 19, they had already discharged their service tax liability as was required during the relevant period before due date and that is reflected in their relevant ST3 Returns. He pointed out that even in the chart given at Para 13 in the SCN, there is an admitted fact that they have paid service tax of Rs.97,64,200/-. Some of these agreements and not as indicated in their appeal memorandum. 7. Further,....
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....sues for determination in this case is whether in respect of agreements at S.No.9 to 14, the appellants are entitled for the benefit under S.No.14(c) of notification 25/2012-ST in terms of insertion of Clause (ca) w.e.f. 01.04.2016 insofar as supply of services to APSHCL is concerned. Admittedly, in this case, the entire disputed period is post this amendment. As regards services to other recipient covered in demand, the same has to be seen whether there is any exemption available to them or otherwise. 11. The appellants are mainly contesting the demand on the grounds that the department has raised the demand for the period April, 2016 to June, 2017 on the basis of income as per ITR, income as per 26AS and the service tax paid as per ST3 filed by them. In fact, they have taken higher value among ITR and 26AS and compared the same with service tax paid as per the ST3 returns to work out the differential service tax required to be paid without having conducted any independent enquiry or investigation as to the nature of the services provided by them to different recipients or working out the taxable value in accordance with the provisions under Service Tax Act and Rules. He furthe....
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....ine the issue on merit also. 13. The appellants have contested the demand on the grounds of limitation and invocation of proviso to section 73(1) of the Finance Act, 1994. Their main contention is that in this case since entire demand is based on their own record and there is no other cogent or positive evidence by the department of their having deliberately withholding the information or suppression of any facts with an intent to evade payment of service tax and therefore, invoking extended period is bad in law as held in catena of judgments. We find that in this case, the SCN was served on 20.10.2021, whereas, the due date for filing ST3 return for the subject period is 15.08.2017 and therefore, the date of issuance is clearly beyond the normal time period allowed for serving notice, where the department is unable to substantiate any grounds for invoking extended period. Therefore, in view of the same, demand for the period 2016-17 and 2017-18 (up to June, 2017) is clearly beyond 30 months. We find force in the reliance placed by the appellant on the judgment of Continental Foundation Jt. Venture Vs CCE [2007 (216) ELT 177 (SC)], wherein, inter alia, it was held that suppressi....
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....nd will not sustain on this ground also. 15. We have also examined the applicability of various notifications and entries claimed by the appellants in their support that the services provided by them to certain entities were otherwise exempted from service tax in terms of Notification No. 25/2012-ST. We find that in terms of Mega Exemption Notification No.25/2012-ST dt.20.06.2012, various services were exempted. This exemption notification was further amended by Notification No.09/2016 dt.01.03.2016, whereby, one additional entry was inserted at S.No.14 as under:- "(ca) low cost houses up to a carpet area of 60 square metres per house in a housing project approved by the competent authority under: (i) The "Affordable Housing in Partnership" component of the Housing for All (Urban) Mission/ Pradhan Mantri Awaas Yojana; (ii) Any housing scheme of a State Government." 16. Therefore, as per this entry, low cost houses up to carpet area of 60 sq mtr per house in a housing project approved by the competent authority under the 'Affordable Housing in Partnership' component of the Housing for All (Urban) Mission/ Pradhan Mantri Awaas Yojana or any housing sc....
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....rea of each flat remains the same irrespective of the flats are in the mode of G+1 or G+2 or G+3. Therefore, a holistic evaluation of all these documents would indicate that the construction of flats by the appellant in terms of agreements with APSHCL would get covered within the ambit of entry under S.No. 14(ca) of Notification No.25/2012-ST dt.20.06.2012 as amended by Notification No.09/2016 dt.01.03.2016 because housing schemes are approved by the Government of Andhra Pradesh and the carpet area of individual flat is less than 60 sq mt. Therefore, on this count, the services provided to APSHCL would be exempted. We note that the adjudicating authority has considered all these agreements and has not doubted the authenticity or the amount indicated therein and in fact, he also held that these were in the nature of WCS. Therefore, we find that the demand of service tax amounting to Rs.1,12,50,172/- in respect of services provided to APSHCL would not sustain as the same would be covered under the exemption notification. It is also noted that appellants have already paid an amount of Rs.44,33,308/- in respect of said services. 19. The appellants have also claimed exemption in resp....
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....der the category of construction of government schools relying on the judgment in the case of Banana Ram Choudhary Vs CCE [Final Order No.53149/2017 dt.01.05.2017], wherein, the Tribunal set aside the demand for service tax in respect of construction work carried out for educational institutions. In the facts of the case, it was obvious that services were provided for construction of schools, hostels, etc. Therefore, demand would not be sustainable. d) APHMIDC: In this case also as against confirmed demand of Rs.27,71,345/-, appellants have already paid the same. However, though they are claiming exemption towards construction of hospital, they have not categorically brought out the notification or the provisions under which such services could be exempted and therefore, in view of the same, we are not inclined to accept their explanation that services provided by them to APHMIDC are exempted. e) K. Aruna: In this case, demand confirmed is Rs.3,23,400/- and the same has already been paid before the due date and they have also filed ST3 return. The appellants are not contesting either confirmation of demand or payment of service tax. f) APIIC: In this case....