Service Tax
TRT-2025-
Cestat Ahmedabad
Date:-28-06-23
In:-
Issue Favourable to Tax Payer ?:-
Order Date – 28 June 2023
Parties: Shree Kankeshwari Enterprise Vs Commissioner of Central Excise & ST, Bhavnagar
Facts –
- The Appellant, Shree Kankeshwari Enterprise, is engaged in providing work contract Services to the State Government, local authority or governmental authority and also to private parties by way of construction of road, bridge, tunnel, ponds or irrigation work, Repairs and Maintenance of civil structure etc.
- Appellant has discharged service tax liabilities from time to time, filed all statutory ST-3 Returns. On verification of 26AS shared by the Income Tax authorities it was found that that the Appellant had short paid Service Tax for the F.Y. 2015-16 to 2016-17.
- Accordingly, a show cause notice was issued demanding the service tax and the same was confirmed with Interest and Penalties.
Issue –
- Whether the alleged demand of Service Tax as confirmed with Interest and Penalties by the Adjudicating Authority is sustainable or not?
Order –
- The Tribunal observed that without conducting any independent inquiry or investigation, the demand of Service Tax cannot be sustained only on the basis of “26AS data” provided by the Income Tax authorities to the Central Excise Officers at Bhavnagar. Service Tax demand cannot be raised on the basis of assessment by the Income Tax Authorities.
- Further, the data provided by Income Tax authorities simply show the details of Income received from sale of services and Service Tax paid thereon. However, in Income Tax Returns, no further details of exemptions availed on services requires to be declared, hence, there may be mis-matched in data of Income tax vis-à-vis Service Tax Returns filed, depending facts of cases.
- Had Commissioner perused/examined 26SAS data correctly before issuance of this SCN dated 19-04-2021, then, scope of SCN would have been with reference to some allegations to deny exemption claimed on one or the other reason. Thus, demand of Service Tax in this SCN only on 26AS data is without application of mind. It is settled that orders beyond scope of SCN are not sustainable in the settled law. The demand of Service Tax confirmed with interest and Penalty by adjudicating authority also deserves to be set aside on this ground.
- Appellant has provided all relevant documents to support their sales transactions. Appellant has also reflected all these transactions in their Books of Account, paid appropriate VAT and Service Tax in respect of sale transactions and Taxable services. Services of Appellant were to Government agencies and even as a sub-contractor were exempted. It was held that Appellant is within four walls for eligibility of the exemption.
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