TaxTMI 
TaxTMI 
TaxTMI 
2025 (10) TMI 883
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....Thousand Six Hundred and Forty Eight Only) on account of cum- tax benefit as discussed above (iii) Applicable amount of Interest on Rs. 6,99,16,017/- under the provisions of Section 75 of the Finance Act, 1994 shall also be recovered from the Party. (iv) I impose a penalty of Rs. 6,99,16,017/- (Rs. Six Crore Ninety Nine Lakh Sixteen Thousand and Seventeen only) upon the party under Section 78 ot the-Finance Act, 1994." 2.1 The Appellant is registered under Section 69 of the Finance Act 1994 (hereinafter referred to as 'the Act') read with Rule 4 of Service Tax Rules, 1994 vide Registration No. AADCS9234LST001 and is engaged in providing services, covered under the category of Works Contract Service'. 2.2 An intelligence was gathered that the party has rendered 'Works Contract service to M/s Lucknow Development Authority (LDA), related to construction of Jai Prakash Narain International Centre at Vipin Khand, Gomti Nagar Lucknow (hereinafter called as 'JPNIC') but had not paid due service tax on the taxable value received from LDA in lieu of the said construction by wrongly claiming exemption from payment of service tax under notificat....
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....& omissions have contravened the provisions of Rule 6 of the Rules and Section 68 of the Act by evading the payment of Service Tax amounting to Rs. 7,33,72,665/- (Rupees Seven Crore Thirty Three Lac Seventy Two Thousand Six Hundred Sixty Five Only) including Education Cess and Secondary & Higher Education Cess and thus rendered themselves liable for penal action under Section 78 of the Act for the reason of suppressing the material fact and willful misstatement i.e not showing the correct value of taxable services in their ST-3 returns, with intent to evade the payment of Service Tax. 2.5 A Show Cause Notice dated 07.06.17 was issued to the appellant asking them to show cause, as to why:- (i) Service Tax amounting to Rs. 7,33,72,665/- (Rupees Seven Crore Thirty Three Lac Seventy Two Thousand Six Hundred Sixty Five Only) should not be demanded and recovered from them under proviso to Section 73 (1) of the Finance Act, 1994; (ii) Interest at appropriate rate should not be charged and recovered from them under Section 75 of Finance Act 1994 for non-payment of service tax, as mentioned in (i) above, by due dates; (iii) Penalty should not be imposed upon th....
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....(a) of Notification No. 25/2012-ST dated 20,06,2012 is available to them? (ii) Whether party is entitled to the Cum tax benefit while computing tax liability? (iii) Whether extended period is invokable (iv) Whether party is liable to pay interest as per provisions of Sec 75 and Penalty as per provisions of Section of 78 of the Finance Act 1994? On the Ist issue I found that- Party has provided Works Contract Service to Ms LDA in respect of Construction of Jai Prakash Narain International Centre. Party has claimed that Jai Prakash Narain International Centre is predominantly for use other than commerce, industry, or any other business or profession and LDA is a Governmental authority,. Therefore Services provided by them to LDA is exempt from Service Tax by virtue of entry No. 12(a) of Notification No. 25/2012-ST dated 20.06.2012. I found that exemption under entry No. 12(a) of Notification No. 25/2012-ST dated 20.06.2012 is available only when following two condition are satisfied (a) The specified services must be provided to Government or Local authority, or Governmental authority. (b) The specified services ....
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....es Act, 1956 as substituted by section 2(11) of The Companies Act, 2013, defines the term 'Body Corporate' as follows:- (11) 'body corporate' or 'corporation' includes a company incorporated outside India, but does not include (i) a co-operative society registered under an law relating to co-operative societies; and (ii) any other body corporate (not being a company as defined in this Act), which the Central Government may, by notification, specify in this behalf; I found that above definition of the term "'Body corporate' is an inclusive definition and has exclusion clause too. It includes the company incorporated outside India but does not include a Co-operative society and any other body corporate, which the Central Government may, by notification, specify in this behalf, In this regard I found that LDA is neither a Co-operative society nor Central Government has notified it as otherwise. Therefore, I do not find any force in the contentions of party in this regard and LDA cannot be treated as Governmental Authority under the provisions of Service Tax law. On the second condition the party in their defense ....
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....rator', including income tax, service tax TDS and VAT etc. Out of total area of JPNIC, around 55139 Sq Mt has been used for convention and sports centre (CSC) and guest rooms and only 3355 Sq Mt has been used for museum. It clearly shows that the facilities available in JPNIC, barring Museum, will be used for commerce or business and the revenue generated out of this will be liable to taxes under different Laws including Service Tax. From the above it is evident that the civil structure of JPNIC is a structure to be used predominantly for business or profession by the JPNIC Society with the help of selected operator as it will generate revenue by operating the JPNIC in a professional manner by renting of its guest rooms, Conference/training/Meeting rooms, Multi-Purpose Hall, Exhibition spaces. Art Galleries etc. and from sale of goods/ services in Restaurant, Food Court Cafeteria and other Banqueting facilities. The revenue so generated from members/ non-member guests will be shared between the two parties i.e. the JPNICS/LDA, the owner of JPNIC, and the operator. The word business can be defined as "An organization or economic system where goods and services are excha....
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....for rendering services to be treated as inclusive of Service tax due to be paid by ultimate customer unless Service Tax is paid separately by customer as per provisions of Section 67 of the Finance Act 1994. Therefore, I am of the view that party is entitled to cum tax beneft while calculating the service tax liability. Accordingly service tax liability of the party is being recalculated as under:- Period Amount as per General Ledger (Work Completed) Taxable Value for original work (40% of Amount) Service Tax (inclusive Cess) Rate Payable 2013-14 528270070 211308028 12.36 24887247 2014-15 955804863 382321945 12.36 45028770 Total 1484074933 593629973 69916017 On the 3rd Issue that whether extended period is invokable or not, I found that party has contested the invocation of extended period on the following grounds that- (i) they have never suppressed any facts relating to nonpayment of service tax from the Department. (ii) they have recorded all financial transactions in books of accounts as per accounting principles. (iii) they have bonafide impression that service tax was not....
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....x by the party on the services provided to LDA would not be unearthed. In the light of above I came to conclusion that contentions of the party put forth are lame excuses and party has willfully suppressed material information from the department with intent to evade payment due service tax, therefore invocation of extended period as per proviso to Section 73(1) of the Act is legal and proper. Now I came to last issue that whether party is liable to pay interest under section 75 and liable to penalty under section 78. Since in view of above discussions I have already come to conclusion that party has willfully suppressed the taxable value with intent to evade payment of due Service Tax, therefore, I found that interest is recoverable from the party under Section 75 of the Act & party is also liable to penalty under Section 78 of the Act for failure to pay service tax." 4.3 From the facts as narrated by the impugned order, we find that JPNIC is a project funded by Govt. of Uttar Pradesh and LDA was given the task to execute the said work as an intermediary and the project was to be owned by Society formed in the name of JPNIC Society. JPNIC Society was made resp....
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.... with an area of 312 sqm., capacity serving both meals i.e. vegetarian and non-vegetarian menu. 5.2.4 Cafeteria: The JPNIC has 2 cafeterias: one on the fourth floor and one on the ground floor respectively. 5.2.5 Banqueting: The JPNIC has designed one large mother kitchen, one service kitchen, two smaller kitchens each with a restaurant and pantries at all floors well-connected through service-lifts meeting the overall requirements of the JPNIC. 5.2.6 Convention Hal: There is one convention hall with auditorium type sitting with a capacity of approximately 2000 pax with an area of 2486sqm. This convention hall will be equipped with all audio-visual facilities and can be used as an auditorium to host big seminars/ conferences or any other cultural events. The facility has collapsible partitions of approx. 700 pax each. 5.2. 7 Multi-Purpose Court: There is one multi-purpose Court with an area of 588 sqm. This multi-purpose court will be equipped with all audio-visual facilities and can be used as an auditorium to host big seminars/ conferences or any other cultural events. 5.2.8 Conference Hall: There is one big conference hall with classr....
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....s 7152 KV of electricity supply to meet all its-requirements 5.3.5 Power back-up: The JPNIC has 4 nos. of generators with 1500 KVA capacity each and 2 nos. of generators with 1000 KVA capacity each to provide 100% power backup facility to the Centre. 5.3.6 CCTV Surveillance: The JPNIC has a non-intrusive security system in place. 5.3.7 Fire Fighting Equipments: There will be a fully addressable fire detection/ fire suppression system in place. 5.3.8 Server Rooms: There will be fully integrated Wi-Fi connectivity in the JPNIC with well networked server rooms at each floor. 5-3-9 Water Treatment Plant: The JPNIC has a waste water treatment plant in place with a specification of 176 KLD. 5.3.10 Sewage Treatment Plant (STP). The JPNIC has a STP in place with a specification of 200KLD. 5.4 SCOPE OF WORK The scope of work for operating Jai Prakash Narain International Centre (JPNIC) is as follows: The JPNIC Society: LDA will form a society under the Societies' Registration Act, 1860 wherein the JPNIC Society will be formed to look after the affairs of JPNIC. This society will oversee the affairs of the s....
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....ses and dependents and member guests. They will be charged a temporary membership fee for use of various facilities) b) The sports, convention, banqueting and dining facilities will have a provision for use by approximately 4000 persons daily on the basis of 50% occupancy rate for two - three shift use depending on season. c) Occupancy at guest room is expected to be 80% round the year d) Cultural and other activities planned in the convention centre, exhibition halls and other halls will generate businass in the restaurants e) There will be separate membership far health club (for non-members/temporary members) and the revenues earned from this will be shared in the same arrangement as for other facilities between the selected operator and the JPNIC Society. Whereas, the health club facility will be free for registered members with JPNICS, f) The Operator can also go for outdoor catering. (Note: The membership fee will go to the JPNIC society. It will be a revenue stream for the JPNIC Society and not the Operator) 5.4.8 LICENSES & TAXES The acquisition of licenses and payment of taxes will be follows: a) Licen....
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.... upon the member requirements. JPNIC will be having individual members, corporate members and temporary members. The membership fee will go to the JPNICS. JPNICS and operator will comply and pay the respective direct and indirect taxes which are applicable to both during the period of agreement between the 'JPNICS' and the 'Operator', including income tax, service tax, TDS and VAT etc.. From the facts as in the tender document it is quite evident that the facilities being created at the JPNIC are meant for revenue generation which will be accounted for with the JPNICS. Thus we are very clear in our mind that the facilities being created are meant for trade and commercial usage. Commissioner has after analysis of the facts and documents available has concluded that the JPNIC was meant for trade and commerce and hence the exemption under Notification No 25/2012-ST dated 20.06.2012 will not be available to the appellant. 4.5 We further note that Hon'ble Allahabad High Court has in case of Greater Noida Indutrial Development Authority [2015 (40) S.T.R. 95 (All.)] held as follows: "The plea of the appellant that it is performing statutory duties and is a c....
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.... in public interest nor it is a mandatory or statutory functions of the Development Authority. Accordingly such activity of leasing do constitute a taxable service, in our opinion." 4.6 The decision of the tribunal dated 26.11.2024, in the appellant own case relied upon by the appellant is clearly distinguishable. Appellant has in that case claimed refund of Rs 80,64,728/- which was denied by the original authority and in Commissioner (Appeal) allowed the appeal filed by the appellant against such rejection. Revenue filed the appeal before the tribunal against the order in appeal. In that case we found that the appellant had filed the refund claim as sequel to tribunal Final Order No 70039/2019 dated 08.01.2019, wherein tribunal has concluded that the activities undertaken by the appellant for GDA in construction of multi level parking at Vaishali Metro Station was not for commerce and hence liable to exemption under Notification No 25/2012-ST. Revenue had accepted that order on the monetary basis in terms of Litigation Policy. In the present case when we have concluded that the activities JPNIC was meant for commerce, we do not find that this judgement will support the case of ....
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....ion when the manufacturer knew otherwise, is required before it is saddled with any liability, before the period of six months. Whether in a particular set of facts and circumstances there was any fraud or collusion or wilful misstatement or suppression or contravention of any provision of any Act, is a question of fact depending upon the facts and circumstances of a particular case..." 4.9 In case of Grauer & Weil (India) Ltd. [1994 (74) E.L.T. 481 (S.C.)] following was observed after referring to the above facts: 14. As has been observed in the above-quoted passage the question as to whether in a given case the requirements for invoking the proviso are fulfilled or not is one of fact. It has therefore to be ascertained whether in the set of facts and circumstances of the instant case, the Collector and Tribunal were justified in concluding that the appellant was guilty of wilful mis-statement and suppression of facts. On perusal of the record we find that in arriving at the above conclusion the Collector and the Tribunal relied upon the following facts and circumstances :- (i) the reference to the declaration dated April 15, 1981 by the appellants in their le....
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....f Metal Box [1995 (75) E.L.T. 449 (S.C.)] following was held: 9. So far as contention No. 1 is concerned, it is obvious that the Department invoked proviso to Section 11A on the ground that while submitting the price list, the appellant had suppressed material facts. It has been found on record that in the price lists submitted by the appellant details of advances made by Ponds (I) Limited, the wholesale buyer of appellant's goods and that too interest free advances of huge amounts were all suppressed from the Department and, therefore, it has to be held that the duty have been short levied on account of wilful suppression of relevant facts by the assessee. This finding is well sustained on record and calls for no interference. We, therefore, concur with the conclusion reached by the Tribunal that longer period of limitation is available to the Department. We reject contention No. 1. 4.11 As we uphold invocation of extended period of limitation as per proviso to Section 73 (1) of the Finance Act, 1994 we also uphold the penalty levied under Section 78 ibid. In case of Rajasthan Spinning and Weaving Mills Ltd. [2009 (238) ELT 3 (SC)] Hon'ble Supreme Court has held as und....
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....y had no discretion in the matter. One of us (Aftab Alam, J.) was a party to the decision in Dharamendra Textile and we see no reason to understand or read that decision in that manner. In Dharamendra Textile the court framed the issues before it, in paragraph 2 of the decision, as follows : "2. A Division Bench of this Court has referred the controversy involved in these appeals to a larger Bench doubting the correctness of the view expressed in Dilip N. Shroff v. Joint Commissioner of Income Tax, Mumbai & Anr. [2007 (8) SCALE 304]. The question which arises for determination in all these appeals is whether Section 11AC of the Central Excise Act, 1944 (in short the "Act') inserted by Finance Act, 1996 with the intention of imposing mandatory penalty on persons who evaded payment of tax should be read to contain mens rea as an essential ingredient and whether there is a scope for levying penalty below the prescribed minimum. Before the Division Bench, stand of the revenue was that said section should be read as penalty for statutory offence and the authority imposing penalty has no discretion in the matter of imposition of penalty and the adjudicating authority in such cas....
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....Chandrashekharan, Additional Solicitor General submitted that in Rules 96ZQ and 96ZO there is no reference to any mens rea as in section 11AC where mens rea is prescribed statutorily. This is clear from the extended period of limitation permissible under Section 11A of the Act. It is in essence submitted that the penalty is for statutory offence. It is pointed out that the proviso to Section 11A deals with the time for initiation of action. Section 11AC is only a mechanism for computation and the quantum of penalty. It is stated that the consequences of fraud etc. relate to the extended period of limitation and the onus is on the revenue to establish that the extended period of limitation is applicable. Once that hurdle is crossed by the revenue, the assessee is exposed to penalty and the quantum of penalty is fixed. It is pointed out that even if in some statues mens rea is specifically provided for, so is the limit or imposition of penalty, that is the maximum fixed or the quantum has to be between two limits fixed. In the cases at hand, there is no variable and, therefore, no discretion. It is pointed out that prior to insertion of Section 11AC, Rule 173Q was in vogue in which n....
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....¹à¤®à¤¾à¤°à¥‡ दà¥à¤µà¤¾à¤°à¤¾ दी गयी निविदा दरों को गहन विचार विमरà¥à¤¶ à¤à¤µà¤‚ अधà¥à¤¯à¤¯à¤¨ के उपरानà¥à¤¤ हम सà¥à¤µà¥‡à¤šà¥à¤›à¤¾ से 18 85 शरà¥à¤¤ संखà¥à¤¯à¤¾ 1, 3 All liabilities on account of service tax de tatitur cess or any other new tas or ary statutory increase in current taxes such as traile tas, labour cess, excise ele shall be payable on actus! basis by the LDA and no liability shall accrue on lis start of work Te aromlectural and structural denwings and design shall be issued betony 1 Tidi vian 3/9 BOQ Item-0 Distance of dumping ground not given-Rate considered for | km 4. VI VRETT 4/ 10 For Non Schedule proprietary item like-Concrete Block work, Water Proofing adlor 500s etc. we shall provide equivalent item 5. शरà¥à¤¤ संखà¥à¤¯à¤¾ 5 / 11 The elev....
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....‹à¤¨ नमà¥à¤¬à¤°-0522-4030444 नतà¥à¤¥à¥€ -: विषय :- गोमती नगर योजना के विपिन खणà¥à¤¡ में जय पà¥à¤°à¤•à¤¾à¤¶ नारायण अनà¥à¤¤à¤°à¥à¤°à¤¾à¤·à¥à¤Ÿà¥à¤°à¥€à¤¯ केनà¥à¤¦à¥à¤° का निरà¥à¤®à¤¾à¤£ कारà¥à¤¯à¥¤ (पà¥à¤°à¤¥à¤® चराग) महोदय, उपरोकà¥à¤¤ कारà¥à¤¯ हेतॠआपकी सरà¥à¤µà¤¨à¤¿à¤®à¥à¤¨ निविदा à¤à¤Ÿ तदोपरानà¥à¤¤ दिये गये पतà¥à¤° दिनांक 20.04.13 दà¥à¤µà¤¾à¤°à¤¾ संशो....
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....à¥à¤¯à¤¾-8 :- शरà¥à¤¤ संखà¥à¤¯à¤¾-7 :- अनà¥à¤¬à¤¨à¥à¤§ के अनà¥à¤¸à¤¾à¤° कारà¥à¤¯ के आदेश पà¥à¤°à¤¾à¤ªà¥à¤¤ होते हैं. तो कारà¥à¤¯à¤µà¤¾à¤¹à¥€ की जायेगी। अपरिहारà¥à¤¯ कारणों अथवा पूरà¥à¤£ होने के उपरानà¥à¤¤ यथाशीघà¥à¤° अनà¥à¤¤à¤¿à¤® à¤à¥à¤—तान की अनà¥à¤¤à¤¿à¤® à¤à¥à¤—तान की कारà¥à¤¯à¤µà¤¾à¤¹à¥€ की जायेगी। शासन के निरà¥à¤¦à¥‡à¤¶à¥‹à¤‚ के à¤....
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....ओ०आर० की मदों में विसà¥à¤¤à¥ƒà¤¤ डà¥à¤°à¤¾à¤‡à¤‚ग / डिजाइन मातà¥à¤°à¤¾à¤“ं के आधार पर हाईट à¤à¤²à¤¾à¤‰à¤¨à¥à¤¸ का à¤à¥à¤—तान किया जायेगा। शरà¥à¤¤ संखà¥à¤¯à¤¾-7 :- अपरिहारà¥à¤¯ कारणों अथवा शासन के निरà¥à¤¦à¥‡à¤¶à¥‹à¤‚ के कà¥à¤°à¤® यदि कारà¥à¤¯ को बनà¥à¤¦ करने शरà¥à¤¤ संखà¥à¤¯à¤¾-8 :- शरà¥à¤¤ संखà¥à¤¯à¤¾-7 :- अनà¥à¤¬à¤¨à¥à¤§ के अन....