2017 (1) TMI 240 - AT - Service Tax

VCES Scheme - rejection as the figures declared by under VCES did not match with the balance sheet and the profit and loss account - Held that - I find that the appellant has given a C.A s certificate which reconciled the figures but the same was not presented before the lower authorities and therefore lower authorities did not get an opportunity to examine the same. On examination of the figures in the profit & loss account and the service tax assessable value did not match for various reasons like the date of payment and date of billing may be different or some services may be for residential renting etc. - matter remanded to the Commissioner (A) to examine the C.A. certificate produced by the appellant and other facts produced by the appellant - appeal disposed off by way of remand.

Summary

Issues:
1. Rejection of declaration under VCES scheme due to discrepancies in figures.
2. Argument regarding comparison of service tax value with balance sheet figures.
3. Appellant's failure to present defense before lower authorities.
4. Consideration of CA's certificate reconciling figures.
5. Discrepancies in profit & loss account and service tax assessable value.
6. Setting aside of impugned order and remand for further examination.

Analysis:
The judgment by the Appellate Tribunal CESTAT MUMBAI dealt with the rejection of a declaration under the VCES scheme by the Revenue due to discrepancies in the figures provided by the appellant. The appellant, engaged in renting immovable property, had filed the declaration which was rejected as the figures did not align with the balance sheet and profit and loss account. The appellant's counsel argued against comparing the service tax value with the balance sheet figures, presenting a certificate from Chartered Accountants reconciling the differences. However, this certificate was not submitted to the lower authorities initially.

The Tribunal noted the appellant's failure to present a defense before the lower authorities but, considering the appellant's individual status and lack of familiarity with the law, decided to examine the issue on merits. The Tribunal acknowledged the CA's certificate reconciling the figures, which was not presented before the lower authorities for examination. Discrepancies in the profit & loss account and service tax assessable value were attributed to reasons like differing payment and billing dates or services related to residential renting. The Tribunal also considered the appellant's filing of returns for the year 2010-11.

Ultimately, the Tribunal set aside the impugned order and remanded the matter to the Commissioner (A) for further examination of the CA certificate and other facts presented by the appellant. The appeal was disposed of by way of remand, emphasizing the need for a thorough review of the reconciled figures and other relevant details. The judgment highlighted the importance of presenting all relevant information and certificates before the authorities for a fair assessment of the tax liabilities under the VCES scheme.