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TMI Blog2022 (7) TMI 718X X X X Extracts X X X X X X X X Extracts X X X X ..... gh said question was neither raised before the lower authorities nor in appeal memorandum before the Tribunal, but sought to be added later as an additional ground by a separate letter. In view of Section 36A of Central Excise Act, 1944 it is only when such document is tendered in evidence against the person who produced the same or from whose custody or control it was seized that the presumption under Section 36A is available - In the present case admittedly none of the alleged invoices / documents was produced by the Appellant or seized from the Appellant s premises or control. In view of the above, when the presumption under Section 36A is not available. The burden of proof is squarely on the Department to prove that the source documents are related to the Appellant and that any taxable services under the source documents were actually provided by the Appellant. This burden has not been discharged in the present case. The department could not have simply accepted the customers documents provided by them on its face value and the same needed strict corroboration which is completely absent in the present case. On the basis of documents/ records received from customers of Ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ness Auxiliary Service , Advertising Agency Service , Market Research Agency Service , Management or Business Consultancy Service and for that they have charged and collected service tax, but failed to deposit the service tax to the government exchequer. Accordingly, show cause notice dated 29-09-2017 was issued proposing the Service tax demand along with interest and penalty. The Additional Commissioner, Surat vide Order-In-Original No. 47/ADJ/ADC-CSM/OA/2017- 18 dated12.04.2018confirmed the demand of service tax along with interest and penalty. Feeling aggrieved, the appellant filed an appeal before the Commissioner (Appeals) who by impugned order -in-appeal dated 09-11- 2018 upheld the order passed by the Additional Commissioner and dismissed the appeal. Aggrieved by the impugned order-in-appeal present Appeal has been filed. 3. Shri Jigar Shah, Learned Counsel along with Shri Ambarish Pandey, Advocate appearing on behalf of the appellant submits that the impugned proceedings are without Jurisdiction, unconstitutional and erroneous, as the department completely failed to comply with the constitutional scheme so applicable after the enactment of the Central Goods and Serv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1994 to demand Service tax. The demand of Service tax should have been proposed under Section 73A of the Finance Act, 1994 and not under Section 73. Therefore, there can be no demand of Service tax as the impugned order is passed without jurisdiction and hence liable to be quashed and set aside. He placed reliance on the following decisions Checkmate Industries Services Vs. CCE, Pune -III, 2016 (44) S.T.R. 290 (Tri. -Mumbai) M/s Fusion India Inc V. CCE ST., Lucknow- 2018 (11) TMI 358 -CESTAT Allahabad. 3.5 He also submits that the show cause notice proposes to recover service tax amounting to Rs. 1,16,59,641/- under Section 73 of the Finance Act, 1994 which is the provision for recovery of Service tax. However, the show cause notice failed to invoke the relevant provision for charging of service tax on alleged activities. In the Finance Act, 1994, Section 66B provides for levy of Service tax on services other than those services specified in the negative list. Since the charging provision was not invoked, no demand is sustainable. He placed reliance on the decision in the case of Frisco Foods Pvt. Ltd. Vs. Commissioner, Customs Central Excise, Dehradun 202 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... um) Frisco Foods Pvt. Ltd. Vs. CCE, Dehradun 2022-VIOL-49-CESTAT-Del- ST 3.9 He further submits that the impugned order relies upon 26AS statements for confirming liability of Service tax. The demand of Service tax cannot be based solely on that basis. He placed reliance on the decisions in M/s Ved Security Vs. CCE, Ranchi-III, 2019(6)TMI 383-CESTAT, Kolkata and M/s Lord Krishna Real Infra Pvt. Ltd. Vs. CCE, Noida 2019(2) TMI 1563- CESTAT Allahabad. 3.10 He also submits that the department has recorded statements of the Directors of the Appellant under applicable provisions of the Finance Act, 1994. Section 9D of Central Excise Act, 1994 provides that a statement made and signed by a person before any Central Excise Officer during the course of inquiry or proceeding shall be relevant for the purpose of proving any prosecution for an offence under the Act. The statement recorded should be first admitted as evidence in accordance with the procedure prescribed in this regard by Section 9D(1)(b) of the Act. The Procedure prescribed in sub-section (1) of Section 9D is required to be scrupulously followed, as much in the adjudication proceedings as in criminal proceedings rela ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... grounds and documents may only be admitted according to the procedure prescribed under Rule 23 of CESTAT (Procedure) Rules, which has not been complied with. The additional arguments tendered by the Appellant now have not been first observed by the Adjudicating Authority. The fresh evidences/documents are not allowed in Tribunal. He placed reliance on the following decisions: (i) Kneader House Vs. CCE, Delhi -I 2013 (290) ELT 249 (Tri- Delhi) (ii) Sterlite Industries (I) Ltd. Vs. CCE Tirunelvelli 2017 (357) ELT 161 (Tri- Chennai) 4.2 He argued that for the GTA service rendered the Appellant have only produced Debit Note/ Consignment note. No supporting details was produced. 4.3 He further submits that Section 73 covers the tax not paid or short paid, which covers the demand made of service tax in present case, while Section 73A covers only two situations viz. 73A (1) covers tax collected in excess than the prescribed rate and 73A(2) covers the situation where any amount representing as service tax has been collected which was not liable to be paid. Here, in this case none of the above two situations is there. He placed reliance on the decision of Bajaj Allianz Life In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and decide the appeal. The relevant observations are as follows : Rule 10 of the 1982 Rules allows the parties to urge grounds not taken in the appeal provided the Tribunal grants leave to the parties to do so. The Tribunal has also been given a wide power to decide the appeal on grounds not taken in the memorandum of appeal. The only limitation on this power of the Tribunal is that the party affected must be given an opportunity of being heard in respect of the new grounds sought to be urged. According to M/s. Davangere Cotton Mills Ltd., the issue had been raised originally before the Tribunal and again before the third member when it was referred to the third member on a difference of opinion. Revenue had ample opportunity of dealing with the submission. Besides, it was submitted, that the issue was in any event being agitated in the matter of M/s. Coats Viyella (India) Ltd. and there was no question of taking the Revenue by surprise. We are of the view that the Tribunal did err in refusing to hear the appellant only on the ground that the ground had not been raised earlier. Rule 10 was sufficiently widely framed to allow the Tribunal to do so. Having regard to the fac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d other financial statement also seized by the department from the business premises of M/s Forward Resources Pvt. Ltd. However, presumption of documents in certain cases under Section 36A of the Central Excise Act is available only when the documents are produced by or seized from the custody or control of the person concerned. For the sake of convenience and ready reference Section 36A of Central Excise Act, 1944 is reproduced below:- Section 36A. - Presumption as to documents in certain cases. - Where any document is produced by any person or has been seized from the custody or control of any person, in either case, under this Act or under any other law and such document is tendered by the prosecution in evidence against him or against him and any other person who is tried jointly with him, the Court shall, - (a) unless the contrary is proved by such person, presume - (i) the truth of the contents of such document; (ii) that the signature and every other part of such document which purports to be in the handwriting of any particular person or which the Court may reasonably assume to have been signed by, or to be in the handwriting of, any particular person ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt company and statement of Shri Jagdishchandra Somani, Director of M/s Forward Resources Pvt. Ltd. However, it is settled law that though the admission is extremely important piece of evidence but it cannot be said to be conclusive and it is open to the person whohas made the admission to show that this is incorrect. We also note that there are numerous decisions of the Tribunal laying down that such admission of persons, cannot be considered to be conclusive evidence to establish the guilt of the assessee. Burden of proof is on the Revenue and same is required to be discharged effectively. The details contained in records of service recipient cannot be accepted as admissible piece of evidence. Moreover, none of the persons on whose statements reliance was placed by the department were cross-examined. The Hon ble P H High Court in case of M/s. G-Tech Industries Ltd. v. Union of India [2016 (339) E.L.T. 209 P H] has held that Section 9D of the Act has to be construed strictly, as mandatory and not merely directory. The Hon ble High Court in the matter of Jindal Drugs Pvt. Ltd. Vs. Union of India 2016 (340) E.L.T. 67 (P H) also held that: 19 . Clearly, therefore, the stage ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rvice tax. 5.5 In the matter of Synergy Audio Visual Workshop Pvt. Ltd. Vs. Commr. of S.T. Bangalore 2008 (10) S.T.R. 578 (Tri. - Bang.), the Tribunal observed as under : The other ground is for confirming demands is that the appellants had shown certain amounts due from the parties in their Income Tax returns and Revenue has proceeded to demand Service Tax on this amount shown in the Balance Sheet. The appellants have relied on large number of judgments which has settled the issue that amounts shown in the Income Tax returns or Balance Sheet are not liable for Service Tax. In view of these judgments, the appellant succeed on this ground also. The impugned order is set aside and the appeal is allowed. In the matter of Calvin Wooding Consulting Ltd. Vs. Commissioner of C.Ex. Indore 2007 (7) S.T.R. 411 (Tri. - Del.) also Tribunal observed as under : 21 . The liability of the recipient cannot arise merely from the fact that, the income-tax was deducted at source, which was the requirement of the Income-tax Act, on the recipient who made payment to the foreign supplier. Such a statutory requirement, as exists under the Income-tax law on the person making the payment to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jasthan and have discharged the Service Tax in Chandigarh and Lucknow, could have been verified with the concerned jurisdictional Chandigarh Commissionerate office. Departmental authority at Jaipur have no jurisdiction to proceed against the respondent for demanding Service Tax without any evidence of taxable service being provided within their jurisdiction. We find that there is nothing in the grounds of appeal which makes us to interfere with the finding of the learned Commissioner (Appeals). The appeal did not advert to any assertion as to how the Service Tax demand can be made when there is no evidence to any taxable service having been rendered in the Jurisdiction of Rajasthan. No inquiries have been conducted by the Revenue to support their case. As such, we find that present appeal is without merit and accordingly, the same is dismissed. In view of the above legal position, we are of the view that the demand of services tax is not sustainable on the basis of TDS /26AS statements. 5.6 Without prejudice, we also find that when the Service tax is demanded on alleged services, it is the responsibility of the department to show that the appellant had rendered these services ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid service are covered under the negative list provided under Section 66D of the Act which reads as under Selling of space for advertisements in print media . Hence, we hold that no service tax demand is sustainable on service provided by Appellant to Indusind Bank Ltd. 5.9 As regard the service provided to M/s. Mohan Infosolution Pvt. Ltd. and M/s Windsor Machine Ltd., we find that in submitted affidavit Appellant fairly admitted that they have paid the services tax on the taxable service provided to remaining entities viz., M/s Mohan Info Solutions Pvt. Ltd. and M/s Windsor Machines Ltd. amounting to Rs. 6,55,327/-. We find that when the tax amount stands already deposited before the issuance of show cause notice, Show Cause Notice was not required to be issued under Section 73(3) of Act. Since the tax amount already been deposited by the assessee, We do not find any reason to uphold the penalty extent to the said service tax deposit amount. 5.10 Further on the basis of documents/ records received from customers of Appellant, revenue alleged that they have collected the service tax payment. However on the basis of records of other persons it cannot be conclude ..... X X X X Extracts X X X X X X X X Extracts X X X X
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