TaxTMI 
TaxTMI 
2026 (2) TMI 1011
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....hereby confirm the demand of interest on the amount mentioned above at (1), against the party under Section 75 of the Finance Act, 1994 read with Section 174 of Central Goods & Services Lax Act. 2017. (iii) I impose penalty of Rs. 30,69,837/- (Rupees Thirty Lakh Sixty Nine Thousand Eight Hundred Thirty Seven Only) upon the party under Section 78 of the Finance Act, 1994 read with Section 174 of Central Goods & Services Tax Act, 2017, (iv) I impose penalty of Rs. 10,000/- upon the party under Section 77(1)(c) of the Finance Act. 1994 read with Section 174 of Central Goods & Services Tax Act, 2017 for not furnishing the requisite documents before the department." 2.1 Appellant is registered with the Department with Service Tax Registration No.AADCG3474GST001 and is engaged in providing taxable services as defined under Section 65B(44) of the Act read with Section 66D of the Finance Act, 1994. 2.2 On the basis of information received from the Income Tax Department, it was observed that for the Financial year 2014-15 appellant in their service tax return they had declared total value of Rs.1,69,27,602/-. Thus it was observed that appellant had short paid s....
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....reme Court is available, demand uptil September 2014 is beyond the period of five years from the relevant date. • In terms of the various decisions and circulars showing the benefit of the above order of Hon'ble Supreme Court is not available to the revenue. • Appellant is registered with the department and have filed ST-3 returns, accordingly, the demand made by the invocation of extended period of limitation is any way barred by limitation. 3.3 Learned Authorized Representative reiterates the findings recorded in the orders of the lower authorities. 4.1 I have considered the impugned orders along with the submissions made in appeal and during the course of argument. 4.2 For rejecting the appeal of the appellant, impugned order records the following findings:- "5.6 As regards to the contention of the appellant that the SCN is time-barred as it was issued after the statutory limitation period of five years from the relevant date and provisions of Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 are not applicable, I find that Section 73 of the Finance Act, 1994, provides that the d....
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....strued strictly. The initial burden is on the Department to prove that the situation visualized by the proviso existed. But the burden shifts on the assessee once the department is able to produce material to show that the appellant is guilty of any of those situations (fraud, collusion, wilful mis-statement, suppression, etc.) visualized in the Section. I derive support for this finding in the decision of the Hon'ble High Court of Judicature at Allahabad in N.K.G. Infrastructure Ltd. Vs Union of India [2017 (346) E.L.T. 109 (All.)] where the Hon'ble High Court quoted the ratio of the judgment of the Hon'ble Apex Court in Commissioner of C. Ex., Aurangabad Vs Bajaj Auto Ltd. [2010 (260) ELT 17 (S.C.)]. I also rely upon the decision of the Hon'ble High Court of Judicature at Madras in Commr. of C. Ex., Salem Vs Salem Co-Operative Sugar Mills Ltd. [2014 (35) S.T.R. 450 (Mad.)] in which the Hon'ble High Court quoted the observation of the Hon'ble Apex Court in Tamil Nadu Housing Board Vs Collector of Central Excise, Madras and Another [1994 (74) ELT 9 (S.C.)] thus "[Once] the department is able to bring on record materials to show that the appellant is guilty o....
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....tation, the Tribunal held that the assessee had duly filed ER-1 returns on a monthly basis. Under the circulars of the Central Board of Excise and Customs, the Range Officer was required to carry out a detailed scrutiny of the ER-1 returns and if this had been done, the short payment would have been detected. There was no evidence of any collusion between the assessee and the jurisdictional Central Excise Officers. The short payment was detected when an audit team visited the premises and examined the records but this, as the Tribunal held, could have been detected even by the jurisdictional Range Officer much earlier. In the circumstances, it was held that there was no suppression of fact or wilful misstatement on the part of the assessee and no ground was, therefore, available for invoking the extended period of limitation. In addition, the Tribunal observed that in the present case, the situation was revenue neutral since, in the facts of the case, the entire duty paid by the assessee in respect of the clearances of MS tanks and radiators to its transformer unit was available to the transformer unit as Cenvat credit. In other words, the Cenvat credit was available not to a third....
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....ctivities, that the department was already aware of the nature of the appellant's operations as early as in 2013. Despite such awareness, the department issued the show cause notice after an inordinate delay, well beyond the ordinary period of limitation, and sought to justify it by invoking the extended period. 9.2 ......... 9.3. It is a settled principle of law that, for the department to invoke the extended period of limitation, there must be an active and deliberate act on the part of the assessee to evade payment of tax. Mere non-payment of tax, without any element of intent or suppression, is not sufficient to attract the extended limitation period. In this regard, reference may be made to the following judgments: (i) Padmini Products v. CCE [(1989) 4 SCC 275] "12. Shri V. Lakshmi Kumaran, learned counsel for the appellant drew our attention to the observations of this Court in CCE v. Chemphar Drugs and Liniments, Hyderabad [(1989) 2 SCC 127 : 1989 SCC (Tax) 245] where at p. 131 of the report, this Court observed that in order to sustain an order of the Tribunal beyond a period of six months and up to a period of five years in v....
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....e, and in view of the fact that there was scope for believing that it was exempt under Schedule annexed to the first notification i.e. No.55 of 1975, being handicrafts, the appellant could not be held to be guilty of the fact that excise duty had not been paid or short-levied or short-paid or erroneously refunded because of either any fraud or collusion or wilful misstatement or suppression of facts or contravention of any provision of the Act or Rules made thereunder. These ingredients postulate a positive act. Failure to pay duty or take out a licence is not necessarily due to fraud or collusion or wilful misstatement or suppression of facts or contravention of any provision of the Act. Suppression of facts is not failure to disclose the legal consequences of a certain provision. Shri Ganguly, appearing for the Revenue, contended before us that the appellant should have taken out a licence under Rule 174 of the said Rules because all the goods were not handicrafts and as such were not exempted under Notification No. 55 of 1975 and therefore, the appellant were obliged to take out a licence. The failure to take out the licence and thereafter to take the goods out of the factory ga....
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....six months on the ground that these dhoop sticks, etc. were not handicrafts entitled to exemption, we set aside the order of the Tribunal and remand the matter to the Tribunal to modify the demand by confining it to the period of six months prior to issue of show-cause notice and pass consequential orders in the appeal on the question of penalty and confiscation. The appeal is allowed to the extent indicated above and the matter is, therefore, remanded to the Tribunal with the aforesaid directions. This appeal is disposed of accordingly." (ii) CCE v. Chemphar Drugs and Liniments [(1989) 2 SCC 127] "7. The respondent filed an appeal before the Tribunal. The Tribunal considered the matter and noted that the appellant's case was that the demand for duty for the period beyond six months was timebarred; and the respondent's case was that the demand for the period beyond 6 months from the receipt of show-cause notice, was time-barred inasmuch as there was no suppression or misstatement of facts by the appellant with a view to evade payment of duty. In support of its claim the respondent produced classification list approved by the authorities during the period 197....
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....he appellants' case is that value of the goods under T.I. 68 was not required to be included but the Revenue's plea is that only value of the specified goods under Notifications Nos. 71/78 and 80/80 was not required to be excluded." 8. On the aforesaid view the Tribunal came to the conclusion that the demand raised on this for a period beyond 6 months was not maintainable. 9. Aggrieved thereby, the Revenue has come up in appeal to this Court. In our opinion, the order of the Tribunal must be sustained. In order to make the demand for duty sustainable beyond a period of six months and up to a period of 5 years in view of the proviso to sub-section (1) of Section 11-A of the Act, it has to be established that the duty of excise has not been levied or paid or shortlevied or short-paid, or erroneously refunded by reasons of either fraud or collusion or wilful misstatement or suppression of facts or contravention of any provision of the Act or Rules made thereunder, with intent to evade payment of duty. Something positive other than mere inaction or failure on the part of the manufacturer or producer or conscious or deliberate withholding of information whe....
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.... meaning that the correct information was not disclosed deliberately 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 render it suppression." (iv) CCE v. Punjab Laminates (P) Ltd. [(2006) 7 SCC 431] "12. At no point of time, the Revenue doubted the correctness or otherwise of the manufacturing process or the ingredients disclosed by the respondent. The stand of the respondent that the industry as such had adopted the same manufacturing process and had been extended the benefit of the exemption notification of 1989 has not been called in question. If the stand of the manufacturer is correct, there was no reason as to why it should be singled out. 13. This Court decided Bakelite Hylam Ltd. [(1997) 10 SCC 350] on 10-3-1997. The impugned notice was issued only on 9-12-1997 evidently relying on or on the basis thereof. 14. It is not a case where the respondents had not disclosed the activities of manufacturing products carried out by them by declaration or otherwise. They responded to each and every query of the appella....