2024 (4) TMI 334 - HC - Service Tax

Time limitation - Construction of Residential Complex - Construction of Villas - suppression of facts or not - construction of complexes other than Villas for the period of 01.04.2011 to 31.03.2012 - Consulting Engineer s Service - waiver of penalty u/s 78 - HELD THAT - Considering the aspect of suppression the Appellate Tribunal has noticed that the assessee was issued with show cause notice dated 02.07.2007 for the period 16.06.2005 to 31.12.2006. The said show cause notice was confirmed by order in original Sl. No. 3/2011 dated 31.01.2011. Vide M/S. ADARSH DEVELOPERS VERSUS THE COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX BANGALORE SERVICE TAX- I COMMISSIONER OF CENTRAL TAX BANGALORE NORTH 2018 (8) TMI 1009 - CESTAT BANGALORE the Appellate Tribunal decided in favour of the Respondent/Assessee and held the Respondent was not required to pay service tax for construction service before 01.07.2010. The appellant has failed in demonstrating that the said finding recorded by the Appellate Tribunal is contrary to any specific material on record. The Appellate Tribunal has considered the aspect of suppression from the proper perspective and noticing the settled position of law has rightly held that the aspect of suppression cannot be attributed to the Assessee. The substantial questions of law are answered in the affirmative i.e. in favour of the Assessee and against the Revenue - appeal dismissed.

Summary

Issues involved:
The issues involved in this case are related to the challenge of a Final Order under Section 35G of the Central Excise Act, 1944, regarding demand for service tax, suppression of facts, and imposition of penalties.

Issue 1: Demand for Service Tax
The respondent-Assessee was issued a show cause notice requiring the submission of balance sheets and documents for a specific period. The Order-In-Original held that the Assessee suppressed facts to evade service tax payment, leading to liability for applicable interest. The Appellate Tribunal upheld demands for certain services but set aside others, remanding one for re-quantification.

Issue 2: Suppression of Facts
The substantial questions of law framed by the court questioned the Appellate Tribunal's decision on suppression. The Appellant argued that the Assessee was guilty of suppression, while the Respondent contended that the Tribunal rightly assessed the case. The Tribunal considered the Assessee's history with previous show cause notices and the judgment in the Nizam Sugar Factory case to conclude that suppression could not be attributed to the Assessee.

Judgment Summary:
The High Court admitted the appeal and framed substantial questions of law regarding the demand for service tax and penalty imposition. The Appellant argued suppression of facts, while the Respondent defended the Tribunal's decision. The Tribunal's consideration of the Assessee's past cases and the Nizam Sugar Factory judgment led to the conclusion that suppression could not be established. The Court found in favor of the Assessee on both substantial questions of law, dismissing the appeal and affirming the Tribunal's Final Order.