2018 (8) TMI 1683 - AT - Service Tax

Cable Operator Service - appellant has suppressed the number of Cable TV connections - Held that - From the fact verified on record, it is evident that the appellant has suppressed the number of subscribers from whom the subscription charges have been collected. The amount paid to the link operator depended on the total number of connections given by the appellant - there is no doubt that the appellant had not properly maintained the record of number of connections and charges collected from the subscribers - appeal dismissed - decided against appellant.

Summary

Issues:
- Allegation of non-payment of service tax by the appellant
- Suppression of the number of Cable TV connections by the appellant
- Quantification of suppressed value for service tax calculation
- Justification of the order by the Revenue
- Consideration of submissions from both sides

Analysis:
The judgment by the Appellate Tribunal CESTAT CHENNAI involved an appeal challenging the Order-in-Appeal related to the appellant's provision of Cable TV Services. The appellant received the Cable TV signal from a specific provider, and the department alleged non-payment of service tax on the collected amounts. After investigations and a show-cause notice, it was concluded that the appellant had suppressed the number of Cable TV connections, leading to a service tax demand of ?73,901 along with interest and penalties under relevant sections of the Finance Act, 1994.

The appellant argued that the department's method of calculating the suppressed value by demanding service tax on the amount paid to the link operator was improper. In response, the Revenue justified the calculation by stating that the appellant had collected consideration from subscribers and paid a portion to the link operator, quantified at ?10.36,695. The Revenue defended this figure, considering the suppressed consideration as a small fraction of the total collected amount paid to the link operator.

Upon reviewing the records and submissions from both sides, the Tribunal found that the appellant indeed suppressed the number of subscribers and failed to maintain accurate records of connections and charges collected. Consequently, the lower authority's decision to quantify the demand based on the amount paid to the link operator was deemed appropriate. As a result, the impugned order was upheld, and the appeal was rejected.

In conclusion, the judgment emphasized the importance of maintaining accurate records and highlighted the consequences of suppressing relevant information in tax matters. The decision underscored the authority's role in quantifying tax demands based on available evidence and justifying their calculations in cases of alleged non-compliance.