2019 (5) TMI 61 - AT - Service Tax

Scope of SCN - issue of abatement raised later - HELD THAT - Since the appellant has now sought eligibility of the abatement of 50% of service tax liability vide Notification no. 30/2012-ST dated 20.06.2012, this is a fit case to be remanded back to the original authority to examine the eligibility under this exemption notification and decide the matter afresh after following principles of natural justice. Appeal allowed by way of remand.

Summary

Issues:
Appeal against Order-in-Appeal for non-payment of service tax on works contract services, imposition of penalties under Sections 77 and 78 of Finance Act, 1994, eligibility for abatement of service tax under Notification No. 30/2012-ST, calculation of service tax liability, remand to original authority for reevaluation.

Analysis:
The appeal was filed against an Order-in-Appeal for non-payment of service tax on works contract services for the period 2012-13 to 2015-16. The department issued a show cause notice demanding service tax of ?6,80,484 along with interest, proposing to appropriate a partial payment made by the appellants and imposing penalties under Sections 77 and 78 of the Finance Act, 1994. The original authority confirmed the demand with interest and imposed penalties, which were partially upheld by the First Appellate Authority. The appellant contended that they had paid a significant amount before the issuance of the show cause notice, and argued for a reduced liability based on a partnership firm's liability and eligibility for abatement under Notification No. 30/2012-ST. The First Appellate Authority rejected the exemption claim due to lack of evidence.

The Member (Technical) considered the arguments and records presented. Given the appellant's claim for 50% abatement of service tax liability under Notification No. 30/2012-ST, the case was deemed suitable for remand to the original authority for a fresh examination of eligibility under the exemption notification, ensuring due process and principles of natural justice. Consequently, the appeal was allowed by way of remand to the original authority for further evaluation and decision-making.

In conclusion, the judgment addressed the issues of service tax liability, penalties under the Finance Act, 1994, eligibility for abatement under a specific notification, and the need for a reevaluation by the original authority. The decision to remand the case back for reexamination ensured a fair assessment based on the appellant's contentions and the legal provisions applicable, emphasizing the importance of following due process and natural justice in such matters.