9911796707
TMI Blog2023 (8) TMI 1321X X X X Extracts X X X X X X X X Extracts X X X X ..... nts and archaeological sites of Remains Act, 1958 (24 of 1958) are liable to service tax w.e.f. 01-04-2015, for the contracts entered after 01.03.2015. The appellant had entered into contracts with the Government Department and other local bodies for construction of buildings after 01.03.2015, executed works and collected the amount for the works executed. They failed to discharge the service tax on the consideration received. Investigation was intiated. Documents were verified and statements were recorded. 1.1 The managing Director of appellant partnership firm deposed inter alia that :- i. M/S SECC, a partnership firm having Shri P. Senthilkumar (himself), Smt. P Parmeswari, Shri. Ramasamy Gounder, Smt. B. Sampoornam, Smt.S.Nandhini, as the partners of the firm. They had not taken service tax registration and are registered only under GST vide GSTIN 33AAUFS3608N1ZM; They were engaged in providing services under the category of works contract services to PWD and other Government Departments of Tamil Nadu; the services provided involves construction of buildings to schools, colleges, court building, office buildings and hospitals; they have not done any work to private parties; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rks contract services to various Government departments namely, PWD buildings (C&M) Division, Namakkal, Erode, Tirupur and Coimbatore, Tamil Nadu Livestock Development Agency, Bharathiar University, PWD Buildings at Udhagamandalam, Madukarai Special Grade Town Panchayat, Tamil Nadu Agricultural University at Coimbatore, Technical Education Division and Postal Division, Chennai; Investigation was initiated on 29.11.2018 and the appellant was issued summons. The appellant has promptly appeared before the Department and given statement under Section 14 of the Act. Subsequently, on 02.08.2018, the appellant submitted the balance sheets and P&L statements, Form-26AS for the financial years from 2015-16, 2016-17 and 2017-18. The contract proceeds of the amounts from the Government department was also furnished. The quantification has been done on such documents. However, due to the Covid-19 pandemic, the appellant could not furnish certain vital documents at the time of investigation and adjudication proceedings. The appellant had replied to the Show Cause Notice on 24.08.2021 based on the records available with them. Being works rendered to Government departments, it took some time for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtments of State Governments. The managing Derector had deposed that based on the work completion as recorded in the measurement book [M-Book] being maintained by the said departments, payments were released through cheque or RTGS. They did not issue bills,. In the instant case, the Point of Taxation is to be determined in terms of Rules 3, 4 and 5 of Point of Taxation Rules, 2011. Rate of service tax during the period was 12.36% 11.4.2015 to 31.5.2015); 14% [1.6.2015 to 15.11.2015), 14.5% 16.11.2015 to 31.5.2016] and 15% [1.6.2016 to 30.6.2017). During the course of investigation. Appellants submitted the Form 26AS and the date wise contract receipts for the entire period. Without considering these documents, the adjudicating authority has considered the total receipts in the profit and loss account and determined the liability by adopting the rate of tax @ 14.5% for 2015-16 and 15% for 2016-17 and 2017-18 for the reasons that the date wise receipt is not available. Thus, the adjudicating authority has acted in excess of his jurisdiction. The Appellants have now produced the bank statements, wherein the date wise receipts are available, which would definitely help the assessing au ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vil Supplies Corporation Vs Principal Commissioner - 2021 (51) GSTL 360 (Mad) [Page 67 of this synopsis), has allowed exemption for the works contract services rendered to government during the period from October, 2015 to June, 2017 which have been erroneously included in the quantification of tax by the department. The Appellants have furnished the details of work orders, which are related to the period prior to 1.3.2015. These details were not available and could not be furnished earlier due to COVID-19 pandemic. Therefore, the tax liability is to be reconsidered. 4.8 The Ld. Counsel has also submitted that Service Tax liability of Rs.35,02,782/- was confirmed based on the reports from various Heads of State Government Departments. Based on such reports, liability was confirmed and observed that the service tax was collected by the Appellants. It is settled law that, when third party evidences are relied, an opportunity should be given to assessee to explain their stand. It can be done either by making such third party to the proceedings or by examining them during the proceedings. This would satisfy the obligations under Sections 9D and 36A of Central Excise Act, 1944, made ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ifficulties faced during the period of Covid-19 pandemic. 8.2 In paragraph 19.3 of the impugned order, it is noted by the adjudicating authority that due to lack of documents, the income as shown in the P&L Statement is taken as the basis for computing the tax liability. The Department has quantified the duty by extending the benefit of abatement, wherever documents are available. Wherever there was no documentary evidence, the quantification of Service Tax was arrived at without extending the benefit of abatement. Needless to say, that in works contract services, as cost of materials also form part of the contract, the benefit of abatement has to be extended to an assessee. 9. The Ld. Counsel for the appellant has argued that the P&L Statement would show the details of value of purchase of goods. However, the Department, though relied upon the income reflected in the P&L account, has not considered the value of goods reflected in the P&L Statement for extending the benefit of abatement. The Ld. Counsel has submitted that the appellant has been able to obtain relevant documents for quantifying the Service Tax demand. 10.1 Another major ground put forward by the Ld. Counsel is th ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
