TaxTMI 
TaxTMI 
2025 (10) TMI 1075
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....ECP6969QST001 for providing/receiving taxable services under the category of 'Management, Maintenance & Repair'. 2.2 The Respondent have entered tripartite agreement for maintenance and repair of residential complex with developers of residential complexes i.e. M/s SVP Builder (P) Ltd. and M/s Friend Land Developers. In the said contract, it was stipulated that the owner of the flats would pay advance maintenance charges for 30 months at the time of taking possession of the flat to developers. These advance maintenance charges were collected by the developers of residential complexes and then transferred to the Respondent. 2.3 Revenue initiated an investigation against the Respondent to find out the correctness of the Service Tax paid. During the course of investigation from ST-3 return of the party filed for the period 2013-14 to 2017 it was noticed that the Respondent was not showing details of the advance receipt in the respective column of ST-3 Returns for the period 2013-14 to 2017 it was noticed that the Respondent was not showing details of advance receipt in the respective column of ST-3 Returns for the period from 2013-14 to 2017-18. Respondents were asked to....
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....ce Tax amounting to Rs 92,01,341/- (Rupees ninety two lakh one thousand three hundred forty one only) inclusive of Education Cess, Higher Education Cess, Swachh Bharat Cess and Krishi Kalyan Cess should not be demanded and recovered from them under Section-73 of the Finance Act, 1994 by invoking extended period of limitation, (ii) An Interest at appropriate rate on non-paid Service Tax amounting to Rs. 92,01,341/-(Rupees ninety two lakh one thousand three hundred forty one only) should not be demanded and recovered from them under Section 75 of the Finance Act, 1994, (iii) Penalty should not be imposed on them under Section 77 of the Finance Act, 1994, (iv) Penalty should not be imposed on them under Section 78 of the Finance Act, 1994 for their various acts of omission and commission, as mentioned in the foregoing paras. 2.7 Show Cause Notice has been adjudicated as per Order-In-Original No.19/JC/ST/GZB/2018-19 dated 27.02.2019 holding as follows:- "Order (i) I hereby reduce the Service Tax demand of Rs.92.01.341/- to Rs.70.37.702/-. I, therefore, confirm the demand of Service Tax amounting to Rs 70,37,702/- (Rupees Seventy Lakh Thir....
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....tting aside the dismissal and restore the appeal. 3.2 Thus matter has been taken up for consideration Ex-parte in terms of Rule 21 of CESTAT Procedure Rules, 1982. 3.3 Heard Ms. Chitra Srivastava learned Authorized Representative for the Revenue who reiterates the ground taken the appeal. 4.1 We have considered the impugned order alongwith the submissions made in the appeal and during the course of argument. The impugned order records as follows:- "6. I have carefully gone through the facts and records of the case as well as the submissions made by the appellant. The appellant has contended that the extended period was not available as the department had already issued a show cause notice no 18/COMMR/ST/GZB/2014-15 dated 10.10.2014 for the previous period from April, 2009 to March, 2013, on the same issue which had already been adjudicated vide OIO No. 08/COMMR/ST/GZB/2015-16 dated 15.12.2016 and against which the appeal filed by the appellant was pending in the Tribunal. I find that in his reply to the SCN the appellant had made the said submission before the adjudicating authority who instead of considering the submission of the appellant and recording his findi....
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....the part of the manufacturer or producer or conscious or deliberate withholding of information when the manufacturer knew otherwise, is required before it is saddled with any liability. Further, the Hon'ble Apex Court in the case of Tamil Nadu Housing Board Versus Collector of Central Excise, Madras (1994 (74) ELT 9 (SC), Interalia, held that "when the law requires an intention to evade payment of duty then it is not mere failure to pay duty. It must be something more. That is, the assessee must be aware that the duty was leviable and it must deliberately avoid paying it. The word 'evade in the context means defeating the provision of law of paying duty. It is made more stringent by use of the word "intent. In other words the assessee must deliberately avoid payment of duty which is payable in accordance with law". 6.2 I, therefore, hold that extended period was not available for raising the demand in the SCN issued when the appellant had already been issued a show cause notice for the previous period. The demand of service tax beyond the normal period was, therefore, not sustainable. Accordingly, penalty equal to the demand of service tax imposed under Section 78 ....
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.... of legality, fairness and reason at higher appellate forums. I find that the impugned order has not been passed conforming to the above directions of the Board which the adjudicating authority was bound to follow. Under the circumstances, I am of the considered view that the contentions of the appellant are required to be examined for passing a speaking order after giving the opportunity to the appellant for submission of documents/ evidence in support of his contentions. 6.4 Regarding demand of service tax on Mandap Keeper, the appellant has contended that the entire amount was paid through challans and shown in ST-3 retums. I find that no separate demand has been raised in respect of Mandap Keeper Services, In fact, the demand is based upon the total receipt of the amount during the said period as shown in the ledgers maintained by the appellant. The contention of the appellant that he had already paid the entire service tax on the said services on abated value, therefore, needs to verified in terms of relevant provisions/ notifications as applicable at the relevant time, and if the service tax against the said service was paid then the same was required to be adjusted ....
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....s pending in the Tribunal and accordingly, he has ordered that the demand of service tax beyond the normal period was, therefore, not sustainable and therefore penalty equal to the demand of service tax imposed under Section 78 of the Finance Act, 1994 is also not sustainable. As is apparent from the facts of the case, in his Order-in-Appeal dated 10.06.2020 the Commissioner (Appeals) has taken superficial note of the premise of the subject case but has arbitrarily altogether disregarded the same while coming to the final conclusion and passing the subject order and thus the said order is a non speaking order. After the issuance of the initial SCN dated 10.10.2014 and the confirmation of the said demand vide the said order dated 15.12.2016, it was statutorily binding on the part of the said party to show the requisite details in their ST-3 returns and in case of non-compliance they were required to inform the department that despite issuance of the SCN for the earlier period they continued to follow the earlier practice of not declaring the value of the subject service in their ST-3 returns. The facts of the case amply prove that the said party was not showing details of advance ma....
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....r Show Cause Notice on the same issue has been issued the Respondent the impugned order concluded that invoking extended period of limitation for the subsequent period would not be a correct proposition. 4.6 It has been further observed in the impugned order that demand made on the basis of balance-sheet for the respective year and such documents provided by the Respondents and no evidence has been adduced to substantiate the allegation of mala fide intention of the Respondents. Therefore, it has been concluded that extended period of limitation could not have been invoked nor penalty under Section 78 can be imposed. 4.7 For invoking extended period of limitation and for imposition of penalty under Section 78 following has been stated in the Show Cause Notice:- "7. Further, it appears that the party had suppressed the correct value of the taxable services provided by them, during the period 2013-14, 2014-15, 2015-16, 2016-17 and 2017-18( up to June 2017), in as much as they failed to declare the correct amount received against taxable services provided to be provided by them in the returns, as prescribed under Section 70 of the Act ibid, and thus escaped proper self-....
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....ty was reconciled with their financial statements and ST-3 returns. I find that they wilfully suppressed the relevant facts with intent to avoid proper payment of tax and therefore extended period was rightly invoked for demand of tax. I have considered the case laws cited by the party and find that the same are not applicable in the present case. The Hon'ble Supreme Court in the case of Pashupati Spinning & Weaving Mills Ltd [2015-TIOL-54-SC-CX) has held that non-disclosure of facts in RT-12 returns amounts to suppression of facts. The Service Tax law being para materia with Central Excise law, the ratio of said decision is equally applicable to the instant case. In view of the settled legal position on the issue of suppression of facts by the Apex Court, the decisions cited by the party are of no assistance. Hence, I do not discuss those cases. In view of the above decisions, the suppression of facts on the part of the party is fully established as they never disclosed to the department about receiving of advance. Hence, invocation of extended period for demand of Service Tax is legal and justified. It has also been observed that under Section 70 of the Finance Act, 1994, eve....
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....- 1995 Supp (3) SCC 462 = 1995 (78) E.L.T. 401 (S.C.), while interpreting the proviso of an analogous provision in Section 11A of The Central Excise Act, 1944, which is pari materia to the proviso to Section 28 discussed above, made the following observations : "4. Section 11A empowers the Department to re-open proceedings if the levy has been short-levied or not levied within six months from the relevant date. But the proviso carves out an exception and permits the authority to exercise this power within five years from the relevant date in the circumstances mentioned in the proviso, one of it being suppression of facts. The meaning of the word both in law and even otherwise is well known. In normal understanding it is not different that what is explained in various dictionaries unless of course the context in which it has been used indicates otherwise. A perusal of the proviso indicates that it has been used in company of such strong words as fraud, collusion or wilful default. In fact it is the mildest expression used in the proviso. Yet the surroundings in which it has been used it has to be construed strictly. It does not mean any omission. The act must be deliberate.....
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....uticals Company v. C.C.E. [1995 (78) E.L.T. 401 (S.C.)], this Court has held that the extended period of five years under the proviso to section 11A(1) is not applicable just for any omission on the part of the assessee, unless it is a deliberate attempt to escape from payment of duty. Where facts are known to both the parties, the omission by one to do what he might have done and not that he must have done does not constitute suppression of fact." 15. In Anand Nishikawa Co. Ltd. v. Commissioner of Central Excise, Meerut - (2005) 7 SCC 749 = 2005 (188) E.L.T. 149 (S.C.), while again referring to the observations made in Pushpam Pharmaceuticals Company (supra), this Court clarified the requirements of the proviso to Section 11-A, as follows :- "26... This Court in the case of Pushpam Pharmaceuticals Company v. Collector of Central Excise, Bombay (supra), while dealing with the meaning of the expression "suppression of facts" in proviso to Section 11A of the Act held that the term must be construed strictly, it does not mean any omission and the act must be deliberate and willful to evade payment of duty. The Court, further, held :- 'In taxation, it ("suppr....
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....o duty does not invite the wrath of the proviso, we fail to understand how the non-payment of duty on disclosed items, after inquiry from the concerned department meets, with that fate. 17. In fact, the Act contemplates a positive action which betrays a negative intention of willful default. The same was held by Easland Combines, Coimbatore v. The Collector of Central Excise, Coimbatore - (2003) 3 SCC 410 = 2003 (152) E.L.T. 39 (S.C.) wherein this Court held :- "31. It is settled law that for invoking the extended period of limitation duty should not have been paid, short levied or short paid or erroneously refunded because of either fraud, collusion, wilful misstatement, suppression of facts or contravention of any provision or rules. This Court has held that these ingredients postulate a positive act and, therefore, mere failure to pay duty and/or take out a licence which is not due to any fraud, collusion or willful misstatement or suppression of fact or contravention of any provision is not sufficient to attract the extended period of limitation." [Emphasis supplied] 18. We are in complete agreement with the principle enunciated in the above ....
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....bservations show that the words "with intent to evade payment of duty" were of utmost relevance while construing the earlier expression regarding the misstatement or suppression of facts contained in the proviso. Reading the proviso as a whole the Court held that intent to evade duty was essentially before the proviso could be invoked. 55. Though it was sought to be contended that Section 28 of the Customs Act is in pari materia with Section 11-A of the Excise Act, we find there is one material difference in the language of the two provisions and that is the words "with intent to evade payment of duty" occurring in proviso to Section 11-A of the Excise Act which are missing in Section 28(1) of the Customs Act and the proviso in particular... 56. The proviso to Section 28 can inter alia be invoked when any duty has not been levied or has been short-levied by reason of collusion or any wilful misstatement or suppression of facts by the importer or the exporter, his agent or employee. Even if both the expressions "misstatement" and "suppression of facts" are to be qualified by the word "wilful", as was done in the Cosmic Dye Chemical case while construing the proviso....
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.... mind. Black's Law Dictionary, Sixth Edition (pp 1599) defines "willful" in the following manner :- "Willful. Proceeding from a conscious motion of the will; voluntary; knowingly; deliberate. Intending the result which actually comes to pass... An act or omission is "willfully" done, if done voluntarily and intentionally and with the specific intent to do something the law forbids, or with the specific intent to fail to do something the law requires to be done..." 23. In the present case, from the evidence adduced by the appellant, one will draw an inference of bona fide conduct in favour of the appellant. The appellant laboured under the very doubt which forms the basis of the issue before us and hence, decided to address it to the concerned authority, the Development Commissioner, thus, in a sense offering its activities to assessment. The Development Commissioner answered in favour of the appellant and in its reply, even quoted a letter by the Ministry of Commerce in favour of an exemption the appellant was seeking, which anybody would have found satisfactory. Only on receiving this satisfactory reply did the appellant decide to claim exemption. Even if one wer....
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.... subsequent show cause notice." From the above it is quite evident that bench has itself held that limitation is a mixed question of fact and law and needs to be determined in accordance with the facts of the particular case and the provision of law. On consideration of the facts of the present case and law available we impugned order concludes that extended period of limitation will not be applicable. Hence we do not find any merits in the reliance placed by Revenue on this decision. b. In Chhatariya Dehydrates Exports [2020 (33) G.S.T.L. 432 (Tri. Ahmd.)], Ahmedabad bench has observed as follows: 7. The next claim of the appellant is invocation of extended period in the second show cause notice. Ld. Counsel has relied on the decision of Hon'ble Apex Court in the case of Nizam Sugar Factory (supra). Ld. AR has relied on the decision of the Tribunal in the case of Uniworth Textiles Limited (supra) wherein in Paras 5.3 and 5.4, the following has been observed :- "5.3 On carefully considering the rival submissions on this point, we are of the view that the ratio of the Hon'ble Supreme Court's judgments in the cases of P&B Pharmaceutical Pvt. Ltd. v....
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....as suppression of facts and consequently, extended period has been rightly invoked, in the subsequent notice also. From the para 3 of the show cause notice it is evident that first letter seeking the information for the period 2013-14 to Jun 2017 was issued to the appellant vide letter dated 22.09.2017 and was followed by the reminders dated 10.10.2017 and 23.10.2017. These letters were followed by summons dated 20.03.2018 and 28.03.2018. The show cause notice for the period April 2009 to March 2013 invoking extended period of limitation was issued on 10.10.2014 and adjudicated by Order in Original dated 15.12.2016. From the above it is evident that Revenue itself had never sought any information in respect of the issues covered by the show cause notice dated 10.10.2014, which were in their knowledge till 22.09.2017. Thus this decision is completely distinguishable on facts. c. Hon'ble Madras High Court has in Days Inn Deccan Plaza [2016 (45) S.T.R. 502 (Mad.)] observed as follows: "11. With regard to the contention that extended period of limitation cannot be invoked and the applicability of the decision in the case of Nizam Sugar Factory (supra), it is ....
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...., the petitioner has not filed their returns in form ST-3. However, on a perusal of the impugned order, it is seen that the second respondent has not recorded such a finding, but what has been recorded is that the petitioner has failed to file Cenvat Credit Profroma, as stipulated under the Rule and failed to declare the service in the ST-3 return in any other manner. Thus, the submission made on behalf of the petitioner also does not merit consideration. 16.For all the above reasons, no grounds have been made to interfere with the impugned order and the present attempt of the petitioner is only to resurrect a stale claim, apart from the entire attempt being barred by principles of estoppel. For all the above reasons, no grounds have been made out by the petitioner to interfere with the impugned order." From the perusal of the above it is evident that in this case has recorded a finding of fact by pointing to the facts that amounted to suppression in the facts of that case and has concluded that extended period of limitation has been rightly invoked. The finding of fact as noted earlier, do not lead to conclusion that extended period of limitation could have been ....