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TMI Blog2024 (3) TMI 352X X X X Extracts X X X X X X X X Extracts X X X X ..... nts have shown income as per ITR/TDS for the year 2012-2013 as Rs. 6,36,27,376/- whereas value of services on which service tax is payable as per Max-ST3 returns is shown as Rs. 5,61,14,132/-, thereby resulting in difference of Rs. 69,35,707/- on which service tax has not been paid. According by the Department had issued Show Cause Notice (SCN) demanding service tax on differential value of Rs. 69,35,707/- under Section 73(1) of the Finance Act, 1994 along with interest and proposing penalties under Section 70, 77 and 78 ibid. The said SCN was adjudicated by original authority in confirming the adjudged demands along with interest, fine/late fees and imposed penalties under Sections 73 and 75 ibid, vide Order-in-Original No. CGST/PUNEII/ JC/026/2019-20 dated 16.10.2019 which was received by the appellants on 30.10.2019. Being aggrieved with the above order, the appellants have preferred an appeal before the Principal Commissioner (Appeals) by filing an application on 17.03.2020 i.e., four months and seventeen days after receipt of the said original order dated 16.10.2019. On the basis of the legal provisions under Section 85(3A) ibid, providing for a time limit of two months for fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... turns, and when the records were audited by the Department, the correct amount of taxable value of services were identified and they have paid service tax accordingly. However these facts have not been considered by the authorities below, on the merits of the case. The show cause proceedings have simply demanded the service tax on the basis of highest difference between the value of services declared in the ITR for income tax purpose and the value of services indicated in ST-3 returns filed, without considering the explanations offered by the appellants. Thus he claimed that the appellants did not contravene any of the legal provision. 3.2 In support of their stand, the learned Advocate had relied upon the following decisions of the Tribunal and the judgement of the Hon'ble Supreme Court, in the respective cases mentioned below: (i) Jagdish Ispat Pvt. Ltd. Vs. The Commissioner, Raipur - Final Order No. 51670/2019 (Tri.- Delhi) (ii) Yapp India Automotive Systems Pvt. Ltd. Vs. C.C.E. & S.T, Pune-I - Final Order No. A/86775/2018 (Tri.-Mumbai) (iii) Banshidhar Sewbhagovan & Company Vs. Collector of Central Excise - 1990 (50) E.L.T. 192 (S.C.) 4. Learned Authorised Representa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty, made on and after the Finance Bill, 2012 receives the assent of the President, relating to service tax, interest or penalty under this Chapter: Provided that the Commissioner of Central Excise (Appeals) may, if he is satisfied that the appellant was prevented by sufficient cause from presenting the appeal within the aforesaid period of two months, allow it to be presented within a further period of one month. (4) The Commissioner of Central Excise (Appeals) shall hear and determine the appeal and, subject to the provisions of this Chapter, pass such orders as he thinks fit and such orders may include an order enhancing the service tax, interest or penalty: Provided that an order enhancing the service tax, interest or penalty shall not be made unless the person affected thereby has been given a reasonable opportunity of showing cause against such enhancement. (5) Subject to the provisions of this Chapter, in hearing the appeals and making order under this section, the Commissioner of Central Excise (Appeals) shall exercise the same powers and follow the same procedure as he exercises and follows in hearing the appeals and making orders under the Central Excise Act, 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eriod of three years from the date on which such appeal is filed. xx xx xx xx xx (4) Save as provided in the National Tax Tribunal Act, 2005, orders passed by the Appellate Tribunal on appeal shall be final." 6.3 From plain reading of the above legal provisions, it transpires that for the period relating to the present case in hand i.e., subsequent to amendment introduced through the Finance Bill, 2012, the Commissioner (Appeals) in an appeal filed before him could consider a case for hearing and determination of the appeal for passing an order, if the same is filed within a period of two months from the date of receipt of the order-in-original. Further, if a case has been made out showing that there was sufficient cause by which the appellant was prevented from filing an appeal within a period of two months, he may allow it to be presented within a further period of one month. Thus, the maximum period within which the Commissioner (Appeals) can entertain an appeal before him is three months. As in the present case the appeal has been filed by the appellants beyond the prescribed maximum period of three months, there is no legal provision under which the same could be obtain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndone the delay after the expiry of 30 days period. 9. Learned counsel for the appellant has emphasized on certain decisions, more particularly, I.T.C.'s case (supra) to contend that the High Court and this Court in appropriate cases condoned the delay on sufficient cause being shown. 10. Sufficient cause is an expression which is found in various statutes. It essentially means as adequate or enough. There cannot be any straitjacket formula for accepting or rejecting the explanation furnished for delay caused in taking steps. In the instant case, the explanation offered for the abnormal delay of nearly 20 months is that the appellant concern was practically closed after 1998 and it was only opened for some short period. From the application for condonation of delay, it appears that the appellant has categorically accepted that on receipt of order the same was immediately handed over to the consultant for filing an appeal. If that is so, the plea that because of lack of experience in business there was delay does not stand to be reason. I.T.C.'s case (supra) was rendered taking note of the peculiar background facts of the case. In that case there was no law declared by this Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led beyond the time limit provided in law, and the first appellate authority is unable to entertain the appeal on account of timebar, the course of option available to the person aggrieved is to appeal before the next appellate authority i.e., the Tribunal in this case, who could consider such a case in terms of the legal provisions of the respective Acts and pass such order as it thinks fit, in confirming, modifying or annulling the decision or order appealed against or refer the case back to the authority which passed such order or direct for fresh adjudication of the case. 6.7 In this context, we are of the considered view that in the factual matrix of the case, where the mis-match of the figures of 'sales receipts' taken from Form 26AS statement relevant to income tax purpose with the value of taxable services for payment of service tax, requires detailed examination of the facts of the case along with various documents relevant to the issue by the original authority. We further note that when the details furnished by the appellants such as Audit Report No.ST/104/2014-15 of the department providing 'Sales reconciliation' after perusal of records maintained by the appellants, w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtment has challenged the dropping of demand contending that the failed to appreciate the importance of Form 26AS in assessing the service tax liability. It has been repeatedly held that no demand can sustain merely on the basis of the difference in figures in ST-3 and Form 26AS as there is difference in the methodology in preparing both the records and Form No. 26AS is not a statutory document for determining the taxable turnover under the service tax provision. In this connection reliance can be placed on the decisions of the Tribunal in Quest Engineers & Consultant Pvt. Ltd. v. Commissioner, Central Goods & Service Tax and Central Excise 2021 (10) TMI 96- CESTAT Allahabad and Krishna Construction Co. v. C.C.E. & S.T.-Bhavnagar 2022 (8) TMI 644- CESTAT Ahmedabad. 30. Regarding the extended period of limitation, the Commissioner observed that the infractions came to the knowledge of the department only during scrutiny and under self-assessment regime it was necessary for the appellant to make full disclosure in the ST-3 returns. Thus, failing to file the ST-3 returns properly infers malafide intent to evade tax and so the extended period of limitation would be invokable and int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ay not be issued indiscriminately based on the difference between the ITR-TDS taxable value and the taxable value in Service Tax Returns. It is once again reiterated that instructions of the Board to issue show cause notices based on the difference in ITR-TDS data and service tax returns only after proper verification of facts, may be followed diligently. Pr. Chief Commissioner /Chief Commissioner (s) may devise a suitable mechanism to monitor and prevent issue of indiscriminate show cause notices. Needless to mention that in all such cases where the notices have already been issued, adjudicating authorities are expected to pass a judicious order after proper appreciation of facts and submission of the noticee." 8.2 In the instant case, we find that the merits of the case have not been examined by the authorities below and by the Principal Commissioner (Appeals), as he had rejected the appeal filed by the appellants only on the basis of limitation of time. Thus we are of the considered view, that the ends of justice would be met, if the case of the appellants was examined on merits by allowing the case to be heard by the original authority in fresh adjudication of the case, by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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