Service Tax
TRT-2025-
Cestat-Ahmedabad
Date:-15-07-22
In:-
Issue Favourable to Tax Payer ?:- 0
Order Date – 15 July 2022
Facts –
- The Appellant, Reynold Petro Chem Ltd., is engaged in providing of various services.
- The Investigation revealed that appellant was engaged in trading as well as providing commission services. Investigation also revealed that Appellant have availed the cenvat credit without having any corroborative evidence.
- Show Cause Notice dated 14-5-2018 was issued proposing Service tax demand along with interest, penalty and disallowance of Cenvat Credit.
- Revenue contended that appellant never filed any reply to SCN before Commissioner nor appeared before him for PH. So, all arguments tendered by the Appellant now have not been first observed by the Adjudicating Authority. The fresh evidences/documents are not allowed in Tribunal.
- Aggrieved the appellant filed an appeal.
Issue –
- Whether the demands of department are without jurisdiction, unconstitutional and erroneous?
Order –
- The Tribunal observed that the transactions records, debit notes/ invoices were provided by the customers to department but, when the presumption u/s 36A is not available, the burden of proof is squarely on the Department to prove that the source documents are related to the Appellants which is completely absent in the present case.
- It was also observed that for confirmation of service tax demand, revenue also relied upon the TDS /26AS Statement. But relying on the case of M/s Ved Security v. CCE, Rachi, CESTAT Kolkata wherein it was held that Income tax and Service tax are two different and independent special Act and their provisions operate in two different fields. Therefore by relying the 26AS /TDS Statement, demand of service tax cannot be made.
- The appellant has produced the copies of input service invoices on the basis of which Cenvat credit has been availed by them. Therefore, the Tribunal did not find any reason to deny the Cenvat Credit.
- Also, regarding the issue related to the admissibility of new evidences in appeal, the Tribunal held that the Cestat has power to consider the new evidences/ grounds, and accordingly the order can be passed, the same view was taken in National Thermal Power Co. Ltd. v. Commissioner of Income Tax case of Supreme Court.
- Therefore the appeal has been allowed and service tax, interest and penalty was set aside.
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