2020 (3) TMI 200 - AT - Service Tax

Validity/scope of SCN - Demand of service tax under different head - the proposal in the show cause notice was for confirmation of demand under Commercial or Industrial Construction Service whereas the demand was confirmed under Erection, Commissioning and Installation Service , Maintenance and Repair Service and Manpower Supply Agency Service - HELD THAT - On perusal of this Tribunal s decision in the case of M/S. MARUBENI INDIA PVT. LTD. VERSUS COMMISSIONER OF SERVICE TAX NEW DELHI 2016 (8) TMI 676 - CESTAT NEW DELHI , it is noted that the demand was raised under Commercial and Industrial Construction Service whereas the same was confirmed under various services other than Industrial Construction Services. In the case of M/s Marubeni India Pvt. Ltd., it was held that as per declaration of law in various cases stated therein allegations are required to be made by revenue very clear in the show cause notice and adoption of classification of service under the heading different than the one proposed in the show cause notice amounts to passing the order beyond the scope of show cause notice - Tribunal in the above stated case made it clear that if the confirmation of service tax is under a different category than the one which was proposed in the show cause notice then such confirmation of demand is not sustainable. Demand do not sustain - appeal allowed - decided in favor of appellant.

Summary

Issues:
Classification of services under different categories than proposed in the show cause notice.

Analysis:
The case involved the appellants who were registered for providing Construction Services for Commercial or Industrial buildings and civil structures. They were issued a show cause notice for short payment of service tax amounting to around ?1.11 crores. The Original Adjudicating Authority confirmed the demand under categories like 'Erection, Commissioning and Installation Service', 'Maintenance and Repair Service', and 'Manpower Supply Agency Service'. The appellant challenged this order before the Tribunal.

The appellant argued that the proposal in the show cause notice was for demand confirmation under Commercial or Industrial Construction Service, but the demand was confirmed under different categories. Citing a precedent, the appellant contended that if the classification of service differs from the one proposed in the show cause notice, the order is not sustainable. The Tribunal considered the submissions and referred to a previous case where it was held that allegations in the show cause notice must be clear, and adopting a different classification of service amounts to passing an order beyond the notice's scope.

After reviewing the case and the precedent, the Tribunal concluded that confirming service tax under a different category than proposed in the show cause notice renders the demand unsustainable. Consequently, the impugned order was set aside, and the appeal was allowed. The Tribunal did not address other grounds raised by the appellant, including the issue of limitation.

In summary, the judgment focused on the importance of aligning the confirmed demand with the categories proposed in the show cause notice. Any deviation from the proposed classification without clear allegations in the notice renders the order unsustainable, as established by legal precedents. The Tribunal's decision emphasized the necessity for coherence between the proposed and confirmed categories to maintain the validity of the demand.