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2023 (6) TMI 1247 - AT - Service TaxDemand of Service Tax confirmed on account of difference in ST 3 return vs ITR filed by the Appellant - case of appellant is that NO DUE CERITIFCATE DATED 16.12.2016 received from the service tax department for the alleged financial year 2015-16 - Invocation of extended period of limitation - HELD THAT - The appellant s business was scrutinised by the service tax department for FY 2015-16 for which a NO DUE certificate was already issued to the appellant by the same service tax department based on ITR filings on 2016. Thus, issuance of present SCN by the department in 2021 based on the same ITR findings cannot be sustained as the department was already in knowledge of the activities of the Appellant and had also given a no due certificate to the appellant. For issuance of SCN involving extended period of limitation, suppression has to be brought on record which has not been done in this case by the revenue. Though the appellant had not appeared in the adjudication proceedings, yet the certificate issued by the department in 2016 clearly establishes that the records were already scrutinised by the revenue in 2016 itself and hence department cannot invoke extended period of limitation to confirm the demand for the same year. The impugned order dated 16.02.2022 set aside on grounds of limitation itself and the appeal stands allowed.
Issues involved:
The issues in this case involve the confirmation of service tax demand for FY 2015-16 based on a difference in ST 3 return versus ITR filed by the Appellant, and the invocation of the extended period of limitation for raising the demand. Confirmation of service tax demand: The appellant filed an appeal against the adjudication Order-in-Original confirming the demand of service tax for FY 2015-16 due to a variance in ST 3 return and ITR filings. The department issued a Show Cause Notice (SCN) based on the ITR filed for that financial year. The appellant contended that being engaged in government contracts, it was not required to be registered with the service tax department, supported by a NO DUE CERTIFICATE received in 2016. The appellant argued that the demand for FY 2015-16 could not be sustained as the department was already aware of the business activities, citing the judgment of NIZAM SUGAR FACTORY. Additionally, the appellant relied on various tribunal decisions to support the claim that no demand can be raised by invoking the extended period of limitation for differences in ST 3 and ITR returns. Invocation of extended period of limitation: The Tribunal found that the service tax department had scrutinized the appellant's business for FY 2015-16, issuing a NO DUE certificate in 2016 based on ITR filings. The issuance of a subsequent SCN in 2021 based on the same ITR findings was deemed unsustainable as the department was already aware of the appellant's activities and had previously given a no due certificate. The Tribunal noted that for the invocation of the extended period of limitation, suppression had to be established, which was not done by the revenue in this case. Despite the appellant's non-appearance in the adjudication proceedings, the certificate issued by the department in 2016 indicated that the records were already scrutinized, leading to the decision to set aside the impugned order on grounds of limitation, allowing the appeal with consequential benefits as per law.
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