2025 (3) TMI 121 - AT - Service Tax

Non/short-payment of service tax - it is alleged that the appellant had received substantial amounts towards the provision of taxable services but has not discharged due service tax - recovery with interest and penalties - HELD THAT - Undisputedly the services provided by the appellant qualify to be treated as export of services. Thus from the impugned order it is evident that Commissioner (Appeal) has himself dropped the demands in respect of all the services provided for which the BRC s were produced. However in respect of the demands where the BRC s were not produced he proceeded to uphold the demand made along with the interest and penalties. The appellant have stated and produced a copy of certificate from Chartered Accountant to the effect that the amount which i.e. Rs.2, 49, 41, 667/- was also received in foreign exchange - By the above certificate it has been certified that appellant have received the amount also in convertible foreign exchange through banking channels. As this certificate was not produced before the Commissioner (Appeal) at the time of adjudication it is deemed fit to remand the matter back to Commissioner (Appeals) for re-consideration of differential demand confirmed. Conclusion - i) The services provided by the appellant qualified as export of services and demands were dropped where supporting documents were produced. However demands without supporting documents were upheld along with interest and penalties. ii) The appellant presented a certificate from a Chartered Accountant during the appeal certifying that a specific amount was received in foreign exchange through banking channels which was not produced before the Commissioner (Appeals). The Tribunal deemed it fit to remand the matter back to the Commissioner (Appeals) for reconsideration in light of the new evidence. Appeal allowed by way of remand.

Summary

The appeal before the Appellate Tribunal CESTAT Allahabad was directed against an Order-in-Appeal passed by the Commissioner (Appeals) Customs, Central Excise & Service Tax, Allahabad. The Commissioner (Appeals) had partly allowed the appeal filed by the appellant, reducing the confirmation of demand of Service Tax, penalty, and maintaining the rest of the impugned order. The appellant, engaged in providing taxable services, was under investigation for not discharging due service tax despite receiving substantial amounts for taxable services.The show cause notice issued to the appellant raised several issues regarding the non-payment of service tax, interest, and penalties under various sections of the Finance Act, 1994, and the CGST Act, 2017. The order in original confirmed the demand for service tax, interest, and imposed penalties on the appellant for failure to pay service tax and suppressing facts to evade payment. The appellant then appealed to the Commissioner (Appeals), who dropped certain demands but upheld others where no supporting documents were produced.During the appeal hearing, the appellant's counsel requested an adjournment, which was considered by the Tribunal. After reviewing the impugned orders, submissions, and arguments, the Tribunal found that the matter was narrow. It noted that services provided by the appellant qualified as export of services, and demands were dropped where supporting documents were produced. However, demands without supporting documents were upheld along with interest and penalties.The appellant presented a certificate from a Chartered Accountant during the appeal, certifying that a specific amount was received in foreign exchange through banking channels, which was not produced before the Commissioner (Appeals). The Tribunal deemed it fit to remand the matter back to the Commissioner (Appeals) for reconsideration in light of the new evidence.Ultimately, the appeal was allowed, and the matter was remanded back to the Commissioner (Appeals) for a fresh consideration. The Commissioner (Appeals) was directed to decide the appeal on its merits within three months, following the principles of natural justice.This judgment highlights the importance of producing all relevant evidence during adjudication and the Tribunal's role in ensuring a fair reconsideration of matters based on new evidence.