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TMI Blog2022 (10) TMI 1079X X X X Extracts X X X X X X X X Extracts X X X X ..... on with the intent to evade payment of duty. When the facts are known to both the parties, omission by one party to do what he might have done would not render it suppression. When the Revenue invokes the extended period of limitation under Section 73(1) of the Finance Act, 1994 the burden is cast upon it to prove suppression of fact. An incorrect statement cannot be equated with a willful misstatement. The latter implies making of any incorrect statement with the knowledge that the statement was not correct. Though the proviso to Section 73(1) of the Finance Act, 1994 carves out an exception and permits the authority to exercise their power recovery within 5 years from the relevant date in the circumstances in the proviso, one of it being suppression of facts - mensrea/the intent to evade the tax liability is the core for invoking the extended period over the normal period. Appellants apparently have mentioned themselves to be under the bona fide belief of still not being liable under service tax. Based on the said belief only they neither had applied the registration nor had ever filed the service tax return. The reason for such bona fide belief stands corroborated from the fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 16 to March, 2017 Rs.3,94,053/- 70/2020- CGST-B (Dem.- ST) dated 28.12.2020 118 & 119 (CRM)ST/JD R/2021 dated 20.05.2021 ST/51024/2021 DGGI/JZU/I NV/Gr.A/ST- GST/60/2018- 19/Pt.XX/1957 Dated 10.02.2020 April, 2017 to June, 2017 Rs. 1,32,124/- 71/2020- CGST-B (Dem.- ST) dated 28.12.2020 118 & 119 (CRM)ST/JD R/2021 dated 20.05.2021 2. The appellants herein were receiving commission from M/s. Adarsh Credit Co-operative Society Ltd. for providing various services including that of 'Consultants'. A specific intelligence was gathered by the Officers of DGGI, Jaipur Zonal Unit about appellants to have received commission from M/s. ACCSL in lieu of providing "Business Auxiliary Services" being provided to said M/s. ACCSL. But the service tax was not being paid by the appellants on the amount of the said commission received. Accordingly, the appellants were enquired vide letters dated 01.02.2018 in Appeal No. ST/51585/2019 and dated 21.06.2018 in Appeal Nos. ST/51021/2021, ST/51022/2021, ST/51023/2021 and ST/51024/2021. The appellants vide their respective separate replies had responded to the query of the department but after several repeated reminders to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eived by them in their respective income Tax Returns filed with Income Tax Department. With these submissions the learned Counsel for the appellant has prayed for impugned order to be set aside. She also challenged the invocation of extended period of limitation with the submission that order under challenge is rather liable to be set aside on this sole ground. In alternative cum tax benefit has been prayed to be extended to the appellants. The orders under challenge are therefore prayed to be set aside and appeals are prayed to be allowed. 5. While rebutting these submissions, learned DR has impressed upon that the appellants had never taken the service tax registration despite the 'Business Auxiliary Services' have been made taxable w.e.f. 01.07.2012 for the sole reason that these services are not covered under negative list of Section 66B of Service Tax Act (Finance Act, 2012). The registration was taken only after the investigation in this case was initiated and that to the registration was under non-assessee category. Resultantly, there is no registration till date. It is impressed upon that had the investigation in this case would not started, the appellants would still be e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1994 carves out an exception and permits the authority to exercise their power recovery within 5 years from the relevant date in the circumstances in the proviso, one of it being suppression of facts. I also relied upon the decision of Hon'ble Supreme Court in the case of Pushpam Pharmaceuticals Company Vs. Collector of C.Ex., Bombay reported as 1995 (78) E.L.T. 401 (S.C.), wherein it has been held that the meaning of the word 'suppression' both in law and even otherwise is well known. In normal understanding it is not different that what is explained in various dictionaries unless of course the context in which it has been used indicates otherwise. A perusal of the proviso indicates that it has been used in company of such strong words as fraud, collusion or willful default. In fact it is the mildest expression used in the proviso. Yet the surroundings in which it has been used it has to be construed strictly. It does not mean any omission. The act must be deliberate. In taxation, it can have only one meaning that the correct information was not disclosed deliberately to escape from payment of duty. Where facts are known to both the parties the omission by one to do what he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant. There is no denial to the fact that appellants have not charged service tax from M/s. ACCSL. There is also no denial to the fact that the entire amount of commission was shown by the appellants in their income tax returns and the tax liability under direct taxes was duly discharged by the appellants. These perusals and undisputed facts are sufficient for me to hold that there was no mala fide intent on the part of the appellants to evade the payment of service tax. They rather were under bona fide belief. This Tribunal in the case of Omega Financial Services Vs. Commissioner of C. Ex., Cochin reported as 2011 (24) S.T.R. 590 (Tri.-Bang.) has held that assessee's bona fide belief cannot be doubted and where the assessee proves reasonable cause for such belief and for the failure to not to discharge its liability, the penalty shall not be imposed upon such assessee. This Tribunal had set aside the penalty in that case by invoking Section 80 of Finance Act, 1994. 10. From the entire above discussion, I hold that since there was the scope and belief with the appellants for entertaining the doubt about no liability of theirs to pay the service tax that the application of Se ..... X X X X Extracts X X X X X X X X Extracts X X X X
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