TaxTMI 
TaxTMI 
2026 (1) TMI 851
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....53 dated 29.09.2022 passed by the Assistant Commissioner of CGST, Division-II, Bareilly is held as correct, legal and proper." 2.1 The appellant is provider of Taxable Service as defined under the Finance Act, 1994 and they are holding Service Tax Registration No. AAGCM9094HSD001. He is providing Storage of warehousing services, Business Aux. Services, GTA Service, Business Support Service and Works Contract Service. 2.2 On the basis of information received from the Income Tax department for the period 2015-16 that appellant have received towards sale of services to Rs.1,27,68,488/-. 2.3 On receipt of said information appellant vide letters dated 04.04.2019, 09.05.2019 and 01.12.2020 were asked to submit reasons for difference found in value of services as per ST-3 and ITR data for the F.Y. 2015-16, 2016-17, 2017-18 (Apr-Jun) along with supporting documents. Appellant vide his letter dated 14.09.2020 submitted a copy of Form 26AS, profit and loss account and agreement dated 10.06.2015 between them and M/s lon Exchange Purified Drinking Water P. Ltd., Mumbai. 2.4 On scrutiny of the documents it was observed that the appellant had received amount against sale of services ....
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....making this demand for various grounds appellant is liable to penalty. 2.9 Show cause notice dated 14.12.2020 was issued to the appellant, asking them to show cause as to why:- "i) Service Tax amounting to Rs. 20,71,984/- (including Cesses), not paid by them, payable on taxable services income received during FY 2015-16, 2016-17, 2017-18 (Apr Jun) should not demanded and recovered from them under the proviso to Section 73 (1) of Finance Act, 1994 read with Section 83 of the Act, and further read with Section 38A of Central Excise Act, 1944 and Section 174 of the Central Goods and Services Tax Act, 2017 ii) Interest on the demand of service tax at the applicable rate should not be recovered from them under them under the provisions of Section 75 of the Finance Act, 1994. iii) Penalty should not be imposed upon them under Section 78 of Finance Act, 1994 for the reason of suppressing the material fact and value wilfully with the department with intent to evade payment of Service Tax." 2.10 The said show cause notice was adjudicated as per the Order-in-Original No.22-ST-DEM/AC/BLY-II/2022 dated 29.09.2022 holding as follows:- "ORDER i. I det....
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....e adjudicating authority has confirmed demand of Service Tax of Rs.20,71,984/- under Section 73(1) with interest under Section 75 and imposed penalty equal to the quantum of demand under Section 78 of the Finance Act, 1994. The demand of Service tax was confirmed by the adjudicating authority holding that the appellant has not disputed the difference between the value of services declared in the ST-3 returns filed for the impugned period and the value of services shown in the Balance sheet of the relevant period. 7.2 I find that the appellant was working as a Carrying and Forwarding agent and was receiving payments against the same. On comparing the value of services declared in the ST-3 returns filed for the impugned period and the value of services shown in the Balance sheet of the relevant period demand of Service tax was made on such differential value. 7.3 Further, it was also observed that the appellant has incurred expenses on inward transportation and the demand of Service tax was made on the basis of the difference between the value of GTA services declared in the Balance sheet and the value of services of GTA declared in their ST-3 returns filed for the ....
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....er (Appeals) any evidence, whether oral or documentary, other than the evidence produced by him during the course of the proceedings before the adjudicating authority except in the following circumstances, namely:- (a) where the adjudicating authority has refused to admit evidence which ought to have been admitted; or (b) where the appellant was prevented by sufficient cause from producing the evidence which he was called upon to produce by adjudicating authority; or (c) where the appellant was prevented by sufficient cause from producing, before the adjudicating authority any evidence which is relevant to any ground of appeal; or (d) where the adjudicating authority has made the order appealed against without giving sufficient opportunity to the appellant to adduce evidence relevant to any ground of appeal. 7.7 Juxtaposition to the statutory provisions supra in the instant case the appellant has submitted new facts by even contradicting their own stand before the adjudicating authority. The appellant has not made any grounds that the adjudicating authority has not admitted any legal evidence or that they were prevented from the sufficie....
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....ce (SCN), para 9, refer to Annexure-A to the SCN, it has been examined by the SCN issuing authority and the amount of service tax has been worked out. Further, the CBIC, vide instruction dated 26.10.2021, instructed on the issue of ITR-TDS data received from Income Tax Department that "Needless to mention that in all such cases where the notices have already been issued, adjudicating authorities are expected to pass a judicious order after proper appreciation of facts and submission of the notice" Thus, also in view of the above, I have seen the documents submitted by the noticee. Also the representative submitted the facts at the time of personal hearing. I find that in the show cause notice the quantification of gross value of receipt of service has been done on the basis of third party data received from the Income Tax department and during further enquiry conducted by the department, which is correct. I find that in the Show Cause Notice (SCN) para 8 & 9 the differential value has been worked out which was never challenged by the noticee during submission of defence reply dated 20.05.2021 not during the course of recording of personal hearing held on 06.07.2021 and 28.02.2022. ....
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....ee's reply is silent in this regard. Thus, from the above. I find that the noticee is failed to defend his case, I find that the service tax which was already paid by the noticee is already considered in the show cause notice. I find that the submission of the noticee is incorrect and far away from the fact. No corroborative evidence furnished in his defence and therefore I am not agree with the differential calculation method and written submission of the noticee. I find that the difference calculation of the noticee is hypothetic and having no base. I also find the difference worked out through instant SCN by the department is correct and proper and having force. The noticee is deliberately not declared the correct value in the mandatory ST-3 returns during F.Y. 2015-16, 2016-17 and 2017-18 (Apr-Jun). I find that the noticee is registered with the department and the service provided by the noticee is under tax net under Section 65B (44) of the Finance Act, 1994. The receipt is under IT Act and balance sheets which have direct nexus with Service Tax and they are covered under Finance Act, 1994 under taxable services. The noticee must have to be complied with the provisions of ....
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.... their under has been correctly invoked in the SCN in question. I also find that if the department would not ask for the information from the Income Tax department (information from third party sources), the said short/non payment of service tax would not be unearthed. From this, I find that the demand of service tax in question is proper and legal and I am determining and confirming the said demand of service tax of Rs. 20,71,984/- under Section 73 (2) of the Finance Act, 1994." 4.4 The facts which has been taken in the show cause notice from ITR and the financial records of the appellants are not in dispute, even otherwise all the financial records were duly audited by the auditors/chartered accountants of the appellant. Taking note of the above, Commissioner (Appeals) has not allowed appellant to make submissions against his own records as per Rule 5 of Central Excise and Service Tax Rules. Can there be any submission contrary to the audited record of the appellant himself. Further, appellant never in proceedings below have sought to produce invoices etc., showing receipts against those invoices. They also have not produced any documents in respect of GTA services received by....
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....ordship then was a Judge of the Nagpur High Court in Rajeshwar Vishwanath Mamidwar & Ors. vs. Dashrath Narayan Chilwelkar & Ors., AIR 1943 Nagpur 117 Para 43). In Sukhbiri Devi And Ors. Versus Union Of India (Uoi) And Ors.[2022 SCC Online SC 1322], the Supreme Court observed as follows: 3. At the outset, it is to be noted that the challenge in this appeal is against concurrent findings by three Courts, as mentioned hereinbefore. The scope of an appeal by special leave under Article 136 of the Constitution of India against the concurrent findings is well settled. In State of Rajasthan vs. Shiv Dayal [(2019) 8 SCC 637] reiterating the settled position, this Court held that a concurrent finding of fact is binding, unless it is infected with perversity. It was held therein:- "When any concurrent finding of fact is assailed in second appeal, the appellant is entitled to point out that it is bad in law because it was recorded de hors the pleadings or it was based on no evidence or it was based on misreading of material documentary evidence or it was recorded against any provision of law and lastly, the decision is one which no Judge acting judicially could reasonably....
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.... section[ 66B] in such manner and within such period as may be prescribed. (2) Notwithstanding anything contained in subsection (1), in respect of [such taxable services as may be notified by the Central Government in the Official Gazette, the service tax thereon shall be paid by such person and in such manner as may be prescribed at the rate specified in section [66B] and all the provisions of this Chapter shall apply to such person as if he is the person liable for paying the service tax in relation to such service. Provided that the Central Government may notify the service and the extent of service tax which shall be payable by such person and the provisions of this Chapter shall apply to such person to the extent so specified and the remaining part of the service tax shall be paid by the service provider. SECTION 70. Furnishing of returns.- (1) Every person liable to pay the service tax shall himself assess the tax due on the services provided by him and shall furnish to the Superintendent of Central Excise, a return in such form and in such manner and at such frequency and with such late fee not exceeding twenty thousand rupees, for delayed....
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....ase Hon'ble Apex Court has observed as follows: "9. We are not really concerned with the other issues as according to us on the challenge to the extended period of limitation ground alone the appellants are bound to succeed. Section 11A of the Act postulates suppression and, therefore, involves in essence mens rea. 10. The expression "suppression" has been used in the proviso to Section 11A of the Act accompanied by very strong words as 'fraud' or "collusion" and, therefore, has to be construed strictly. Mere omission to give correct information is not suppression of facts unless it was deliberate to stop the payment of duty. Suppression means failure to disclose full information with the intent to evade payment of duty. When the facts are known to both the parties, omission by one party to do what he might have done would not render it suppression. When the Revenue invokes the extended period of limitation under Section 11A the burden is cast upon it to prove suppression of fact. An incorrect statement cannot be equated with a willful misstatement. The latter implies making of an incorrect statement with the knowledge that the statement was not correct. ....
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....issue of invocation of extended period, I find that in the facts of the case, it is obvious that the Appellants were following certain method of calculation for discharge of Service Tax which was not proper or in accordance with the applicable laws, Rules, etc. The whole discrepancy was noticed only on detailed verification and plausible submissions made by the Appellants. Some of the submissions like deduction of Service Tax paid to the vendors, though accepted by the Commissioner (Appeals), and not disputed by Revenue, are debatable on the fair reading of applicable legal provisions which require service provider to discharge Service Tax and the service recipient is required to pay the Service Tax. The recipient of service on which service tax has been paid is also entitled to take credit and utilize against his further liability subject to provisions of Cenvat Credit Rules. Therefore, the payments including Service Tax made to the sub-contractor cannot suo moto become eligible for deduction from the gross value of recipient, which is required to be taken as basis for discharge of Service Tax. Since the Commissioner (Appeals) has already given the benefit in this regard and this ....
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....the facts considered were that the Department had taken five years to serve the SCN and also in view of the unit of the Respondent being audited during the said period several times and there was physical inspections by the Department as well. No such facts are on record in the present case. 27. Similarly, in the case of Blue Star Ltd (cited supra), there was some bonafide belief as regards entry number of the product under erstwhile Item No. 29A(3) in view that facts were known to the Department as well as many High Courts have taken a view that tax on walk-in coolers will not be covered under Item No. 29A(3) and therefore, this case is also distinguishable in view of the facts that there was nothing on record to suggest that Appellants had any bonafide belief regarding method of calculation of gross value in view of any conflicting Court cases or directions of the Department regarding applicable method of valuation or claim of abatement in respect of their services etc. 28. Similarly, in the case of Damnet Chemicals Pvt Ltd (cited supra), the Hon'ble Supreme Court, inter alia, held that non-mentioning of license agreement in the classification list would not....
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....st facto approval, the appellant claimed that they had not used any imported input such as fertilizer, plant growth regulations, etc. in growing flowers sold in DTA, despite having imported green house equipment, raw materials like Live Rose Plants and consumables like planting materials and fertilizers. Therefore, it prima facie appeared that suppression by the appellant was "wilful". The burden of proving to the contrary rested upon the appellant, which the appellant failed to discharge by failing to establish that the imported inputs were not used in the production of the cut flowers sold in DTA. In view thereof, the authorities below have rightly invoked Section 28 of the 1962 Act and allied provisions. 4.9 Thus I do not find any merits in the submissions made by the appellant to effect that demand is hit by limitation and extended period could not have been invoked as per the proviso to Section 73 (1) of the Finance Act, 1994. As I uphold the invocation of extended period of limitation as per proviso to Section 73 (1), the penalty under section 78 follows as has been held by the Hon'ble Apex Court in case of Rajasthan Spinning and Weaving Mills Ltd. [2009 (238) ELT 3 ....