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2017 (3) TMI 1102 - AT - Service TaxValidity of SCN - incomplete information in SCN - whether the SCN have been issued without alleging short payment/non-payment of Service tax and/or is vague? - Held that - the SCN is defective as it do not have or annexed the contents of letter dated 21.01.2009 issued by DGCEI to the office of Commissioner, Customs and Central Excise, Meerut-I. Non supply of copy of information received by DGCEI from EPFO or any other source, render the SCN vague - There is no allegation in the SCN that the appellant had filed wrong returns and returns filed have been found to be prima-facie wrong, without reference to the books of account maintained by the State Bank of India - SCN, based on incomplete information, not sustainable - appeal allowed - decided in favor of appellant.
Issues:
- Allegations in show cause notice regarding Service Tax payment - Defects in show cause notice - Adjudication of the case - Appeal decision and penalties imposed Allegations in Show Cause Notice Regarding Service Tax Payment: The issue in this appeal revolved around the validity of the show cause notice issued without specific allegations of short payment/non-payment of Service Tax. The notice was based on intelligence from DGCEI, Bangalore, indicating that a bank was providing services related to the operation of accounts of EPFO without paying Service Tax. The State Bank of India had allegedly not discharged its Service Tax liability on the services provided to EPFO, leading to the issuance of the notice. However, upon scrutiny, it was found that the notice lacked crucial details and failed to establish a clear accusation against the appellant. The information provided was incomplete and not sustainable, leaving the appellant unaware of the specific allegations against them. Defects in Show Cause Notice: The appellate tribunal found that the show cause notice was defective as it did not include or attach the contents of the letter from DGCEI dated 21.01.2009, which was crucial for understanding the basis of the allegations. Additionally, the notice lacked a copy of the information received from EPFO or any other source, rendering it vague and mechanically issued without proper application of mind. The tribunal highlighted that there were no specific allegations regarding incorrect filing of returns or any reference to the State Bank of India's accounting records. Due to these deficiencies, the tribunal deemed the show cause notice as untenable and set it aside, granting relief to the appellant. Adjudication of the Case: The show cause notice was adjudicated earlier, resulting in a reduced amount being confirmed as Service Tax short paid along with interest, and penalties imposed under relevant sections of the Finance Act, 1994. The appellant then appealed to the Commissioner (Appeals), who upheld the demand and penalties but set aside one of the imposed penalties. However, upon further review by the appellate tribunal, it was determined that the initial show cause notice was defective and lacked essential details, leading to the decision to set aside the impugned order and allow the appeal. Appeal Decision and Penalties Imposed: After considering the arguments and examining the records, the appellate tribunal concluded that the show cause notice was flawed and not sustainable due to its incomplete and vague nature. As a result, the tribunal set aside the impugned order and allowed the appeal in favor of the appellant. The appellant was granted consequential benefits as per the law, highlighting the importance of providing clear and specific allegations in legal notices to ensure a fair and transparent adjudication process.
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