Order Date – 15 July 2022

Facts – 

• The Appellant, Shresth Leasing & Finance Ltd, was engaged in providing services as Commission agents to M/s Windsor Machines Ltd., and Management or Business Consultancy to various customers in India.
• Revenue alleged that appellant neither filed ST-3 returns nor paid any amount of Service tax in respect to the alleged services. Accordingly, show cause notice on 20.10.2016 was issued proposing the Service tax demand along with interest, penalty.
• Aggrieved, the appeal has been filed attaching additional documents before appellant Tribunal for the first time.

Issue – 

• Whether the imposed Service tax, penalty and interest are maintainable and whether the appellant can submit additional documents/ records and additional evidences before the appellate Tribunal in their support?

Order – 

• The Tribunal was of the opinion that, being a final fact finding authority they can very well admit fresh evidence and argument. This issue has been considered by the Hon‘ble Supreme Court, in the case of National Thermal Power Co. Ltd. v. Commissioner of Income Tax, which is to the effect that the Tribunal has jurisdiction to examine the question of law which arises on facts.
• From the submission of appellant it is clear that appellant provided the various types of services to various entities and Department has classified all as commission agent services under the category of business auxiliary service‘ and management consultancy service‘ is legally not correct.
• It was also observed that for confirmation of Service tax demand, revenue also relied upon the TDS /26AS Statement. But relying on M/s Ved Security v. CCE, Rachi, CESTAT Kolkata they 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.
• Therefore, the appeal has been allowed and Service tax, interest and penalty was set aside.