2018 (9) TMI 1385 - AT - Service Tax

Jurisdiction - power of Commissioner (Appeals) to make further enquiry in the matter of assessment of tax liability - Extended period of limitation - short payment of Service Tax - Commissioner (Appeals) had not taken those into consideration that the appellant had indeed filed reply to the show cause notice which was not taken on record by the lower authority and ultimately he confirmed the order of the lower authority even after acknowledging the fact that appellant had submitted photocopies of invoices and Cenvat Credit available in its account. Held that - The order of Commissioner (Appeals) is not in conformity to the legal position and the power confered on him. Hence, the order passed by the Commissioner (Appeals) dated 30.01.2018 in order no. NGP/EXCUS/000/APPL/684/17-18 is hereby set aside. The matter is remitted back to the Commissioner (Appeals) for fresh adjudication upon exercise of his power of adjudicating authority in the matter of assessment of service tax liability of the appellant on proper verification of documents available in the record - appeal allowed by way of remand.

Summary

Issues:
Demand of service tax allegedly short paid by the appellant, consideration of appellant's reply to show cause notice, failure to verify documents by adjudicating authority, legal position and powers of Commissioner (Appeals).

Analysis:
The judgment revolves around the confirmation of a demand of service tax allegedly short paid by the appellant, leading to the imposition of interest and penalty. The appellant refuted the allegation of short payment during an audit and justified the full tax payment made by Challan plus Cenvat Credit. However, the adjudicating authority and the Commissioner (Appeals) did not consider the appellant's submissions adequately. The Commissioner (Appeals) acknowledged the appellant's reply to the show cause notice but failed to verify the documents, citing that assessing the appellant's claim was beyond the scope of the notice. The judgment referenced the Hon'ble Supreme Court's decision in MIL India case, emphasizing the Commissioner's responsibility to assess the appellant's tax liability properly.

The Tribunal highlighted the statutory provision and the Supreme Court's pronouncement in the MIL India case to assert that the Commissioner (Appeals) did not act in accordance with the legal position and his conferred powers. Consequently, the Tribunal set aside the Commissioner (Appeals)'s order and remitted the matter back to him for fresh adjudication. The Commissioner (Appeals) was instructed to exercise his power as an adjudicating authority to assess the appellant's service tax liability properly by verifying the available documents and requesting necessary documents from the appellant. The appellant was reminded of their duty to produce the required documents upon notice for the fresh adjudication process.

In conclusion, the Tribunal's judgment focused on ensuring that the Commissioner (Appeals) adheres to the legal framework and exercises his powers appropriately in assessing the appellant's service tax liability. The decision aimed to uphold procedural fairness and thorough verification of documents to reach a just and proper outcome in the matter.