2018 (10) TMI 1073 - AT - Service Tax

Demand of differential tax - difference between the figures so received from Hindalco and the value of the services reflected by the appellants in ST-3 returns - demand of service tax with interest and penalties - extended period of limitation - Held that - The decision to reassess the service tax in respect of both the appellants for the period from April, 2005 to 31 March, 2010 is already exercised by Revenue by issue of other show cause notices in respect of consideration on account of amount of PF and Bonus. The present show cause notices are reassessment of reassessment for the same period - Such authority is not available to Revenue. Appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Difference in consideration received by contractors and reflected in ST-3 returns.
2. Validity of show cause notices invoking longer period of limitation.
3. Reassessment of service tax for the same period.
4. Consideration of non-taxable services in the value of taxable services provided.

Analysis:
1. The appeals involved contractors providing services to a company, with a discrepancy in the consideration received from the company and the value reflected in the ST-3 returns. The Revenue raised demands based on this difference, leading to show cause notices and subsequent imposition of penalties.

2. The learned Advocate for the appellant argued that the variance in value was due to providing non-taxable services, presenting a list of such services to support the claim. Additionally, reference was made to Annexure-A of the show cause notices, highlighting that the Revenue had already considered the amount of PF and Bonus in other recovery notices for the same period.

3. The Revenue justified the demands based on information from the service recipient and the discrepancy in consideration. However, upon review, the Tribunal found that the present show cause notices were essentially reassessments for the same period, which was not permissible. It was noted that the Revenue should have accounted for all aspects of short levy, including PF and Bonus amounts, before issuing demands.

4. After considering arguments from both sides and examining Annexure-A of the show cause notices, the Tribunal concluded that the present show cause notices were not sustainable. The Tribunal held that the Revenue lacked the authority to reassess reassessments for the same period, and therefore, set aside the impugned orders, allowing both appeals with any consequential relief.

This detailed analysis of the judgment from the Appellate Tribunal CESTAT ALLAHABAD highlights the key issues, arguments presented, and the Tribunal's findings, providing a comprehensive understanding of the legal decision.