2015 (10) TMI 1737 - HC - Service Tax

Valuation - Mandap Keeper service - Whether Tribunal was right in holding that no evidence was produced by Appellant regarding quantum of room rent treating 80% of the consolidated charges collected as room rent and that entire consideration received by Appellant was towards banquet hall and liable to service tax under Mandap Keeper Service? - Held That - Opportunity to produce evidence could have been given by Tribunal during the course of appeal and same was dismissed on a technical ground - Opportunity to produce evidence granted - Impugned order quashed - Matter remanded back - Decided in partly in favour of assessee.

Summary

Issues:
1) Dismissal of appeal by Tribunal for lack of evidence
2) Appellant's contention regarding nature of services provided
3) Tribunal's failure to provide opportunity to produce evidence
4) Substantial questions of law raised in the appeal

Analysis:
1) The Tribunal dismissed the appeal of the Assessee due to the lack of relevant evidence presented. The Tribunal's order referenced the absence of necessary evidence as the grounds for dismissal. The Assessee, represented by Mr. Shah, argued that the demand was based on the misconception that the Appellant provided Mandap Keeper service, whereas the Appellant actually operated a resort. It was highlighted that in previous cases, the Tribunal had ruled that room rent should not be considered part of Mandap Keeper Service.

2) The Appellant's representative contended that the Tribunal had previously ruled in favor of the Assessee in similar circumstances. However, this time, the Appellant was not given the opportunity to present evidence such as a Chartered Accountant's certificate. Due to the lack of evidence, the Assessee failed to convince the Revenue of the similarities in the present case.

3) On the other hand, Mr. Jetly argued that the Tribunal's findings were based on factual evidence and the lack of proof, which did not raise any substantial legal questions. He asserted that the appeal lacked merit and should be dismissed. The High Court examined the Tribunal's order, noting that the Tribunal was aware of conflicting contentions and previous rulings in favor of the Assessee.

4) The High Court found that the Tribunal should have either allowed the production of crucial evidence or remanded the matter back for further consideration. Consequently, the High Court concluded that the appeal raised substantial questions of law, specifically related to the evidence regarding room rent and the nature of services provided. The Court emphasized the importance of affording the Appellant the opportunity to present the necessary evidence to ensure justice and prevent any miscarriage of justice.

In conclusion, the High Court quashed the Tribunal's order, reinstated the appeal, and directed the Tribunal to permit the Appellant to submit additional evidence. The Court clarified that it had not expressed any opinion on the service tax demand and interest, leaving these matters open for further consideration. The High Court allowed the appeal, emphasizing the importance of providing a fair opportunity to present evidence and ensuring a just decision based on all relevant facts.