Service Tax
TRT-2025-
Cestat-Ahmedabad
Date:-17-06-22
In:-
Issue Favourable to Tax Payer ?:- 0
Order Date: 17 June 2022
Facts:
- The appellant, M/s T.S. Motors India Private Ltd, is engaged in providing business auxiliary service.
- On scrutiny of the records of the appellant it was noticed that the appellant had not paid service tax from 2004-2005 to 2007-2008 on several items of work, so a show cause notice (SCN) dated 24.10.2009 was issued to the appellant demanding service tax by invoking the extended period of limitation as contemplated under section 73(1) of the Finance Act.
- The Commissioner held that the extended period of limitation was rightly invoked, aggrieved, an appeal has been filed.
Issues:
- Whether the Department was justified in invoking the extended period of limitation of five years
Order:
- The Tribunal was of the opinion that even when an assessee has suppressed facts, the extended period of limitation can be evoked only when “suppression‟ is shown to be willful with intent to evade the payment of service tax.
- Relying on the case of Commissioner of Central Excise, Nagpur v. Ballarpur Industries Ltd., the tribunal held that it was well settled that a SCN is the foundation in the matter of levy and recovery of duty, penalty and interest, and if there was no invocation of Rule 7 of the valuation rules, 1975 in the SCN, it would be not open to Commissioner to invoke the said Rule.
- In the present case, the SCN merely mentions that the appellant suppressed the value of taxable service. The SCN does not mention that suppression was with an intention to evade payment of service tax.
- In the view of the same, the order was set aside and appeal was allowed.
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