At, Customs Excise Service Tax Appellate Tribunal Principal Bench New Delhi
By, THE HONORABLE JUSTICE: S.K. MOHANTY
By, MEMBER AND THE HONORABLE JUSTICE: B. RAVICHANDRAN
For Petitioner: Narender Singhvi, Advocate And For Respondents: Sanjay Jain, Authorized Representative (DR)
1. The appeal is against order dated 17/10/2012 of Commissioner (Appeals), Bhopal. The appellants are engaged in providing taxable services under various categories and were registered with the Department for such payment. They were also filing regular ST-3 returns with the Department. The dispute in the present case relates to non-payment of service tax on certain consideration which is shown in their annual balance sheet for the year 2005-2006 and which appeared to have been not declared in the statutory ST-3 returns. Based on the difference between the ST-3 returns and the annual balance sheet, the Revenue entertained a view that the appellant short paid service tax and accordingly issued show cause notice dated 25/11/2009 to demand and recover the short paid service tax of Rs. 34,48,000/-.
2. The learned Counsel appearing for the appellant submits that the whole proceedings are so vague that the appellant is not able to defend their case. The show cause notice simply compared the annual balance sheet of the appellant and tallied it with the ST-3 returns. Noting there is a difference, a short levy demand was made against the appellant. The nature of service rendered and the service recipient and the amount attributable to such service has not been explained at all in the show cause notice. The appellant filed detailed break up figures and defended their case. Still the lower authorities proceeded to confirm the demand without verifying the details or justifying the demand.
3. The learned AR submitted that it is for the appellant to satisfactorily explain the difference between the balance sheet and the statutory returns. Since they were registered with the Department for payment of service tax under BAS the short levy was apparently towards that service only.
4. We have heard both the sides and perused the appeal record. The only point on which the present demand is made that there is difference between the statutory returns and the annual balance sheet. We have examined annual balance sheet as explained/submitted by the appellant. Admittedly, the appellants have more than one business premises through which the taxable service were provided. These were registered with the Department and discharging the service tax. The balance sheet of the appellant as a whole did not distinguish the different service centres. Further, we note that the show cause notice did not give any reason to allege short levy except the difference between balance sheet and the ST-3 returns. We note in the appellant's own case for the earlier period, same dispute came up before the Tribunal in : 2015 (37) S.T.R. 308 (Tri. - Del.). It was observed that in the show cause notice there is not even single line describing as to what service was rendered by the appellant which is sought to be covered. Further, examining the defence submissions, the Tribunal held that the appellants were not liable to service tax. In the present case, neither the notice nor the lower authorities have justified the demand for short levy or short payment of tax with any cogent reason. The burden of explaining the difference amount being not taxable income has been shifted to the appellant. This will be against the very basis of tax levy. It is the Department which alleged short payment and at least basic preli
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minary supporting evidence of such short payment has to be made so that the appellant can defend their case. 5. In view of the above discussion, we find no legal justification to sustain the impugned order for the reasons stated above. Accordingly, the impugned order is set aside. The appeal is allowed. (Order dictated and pronounced in open court.)