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TMI Blog2024 (6) TMI 770X X X X Extracts X X X X X X X X Extracts X X X X ..... service tax of Rs.56,19,357/- @ 12.36% was short paid by the appellant. Therefore, by invoking proviso to sub-section (1) of Section 73 of Finance Act, 1994 for extended period of limitation, appellant was called upon to show cause as to why short paid service tax amounting to Rs.56,19,357/- should not be recovered from them. Appellant was also called upon to show cause as to why they should not pay interest on the said short paid service tax and why they should not be imposed with penalty under Section 78 of Finance Act, 1994. At the end of the show cause notice, there is no list of documents based on which the said show cause notice was relied upon. Appellant vide letter dated 17.09.2020 submitted copy of balance sheet, profit and loss account and copies of ST-3 returns filed for the period from April 2013 to March 2014. Appellant submitted their reply dated 04.02.2021 to the said show cause notice along with copy of sale/purchase sample bills, copy of party ledgers, copy of 26AS statement, copy of contract agreement for the work undertaken and reconciliation statement of amounts which were not liable to service tax. The said show cause notice was adjudicated through order-in-or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... structions for pre- consultation with the appellant by the officers of Revenue before issue of show cause notice and the said procedure was also not followed. He has relied on following precedent decisions of this Tribunal:- a. Umesh Tilak Yadav (2024) 159 taxmann.com 336 (Mumbai-CESTAT) b. Commissioner vs. Modern Road Makers Pvt. Ltd. (Appeal No. ST/86984/2021) c. Principal Commissioner vs. SBI Life Insurance Co. Ltd. [2024] 159 taxmann.com 168. d. Lord Krishna Real Infra Pvt. Ltd. 2019 (2) TMI 1563 - CESTAT All. e. Sharma Fabricators & Erectors P Ltd. 2017 (7) TMI 168 - CESTAT All. f. Kush Construction 2019 (5) TMI 1248 - CESTAT All. Learned counsel has submitted that it is no more res integra that only on the basis of difference between figures reflected in ST-3 return and the income reflected in income tax return, demand of service tax on differential value cannot be determined unless the assessee's records are scrutinized and on the basis of the activities of the assesse unless it is established that a particular consideration was received for providing service and the same was not covered in ST-3 return, demand cannot be raised. He has submitted that since the sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taxable service which has not suffered service tax needs to be determined as the first step. 6. Now we will examine the second issue at B above. We note that without examination of any of the records of the appellant on the basis of data received from outside source, Revenue has come to a conclusion that taxable value of Rs.4,54,64,051/- for the period from October 2013 to March 2014 has not been subjected to payment of service tax. In the said show cause notice, no evidence has been brought forward to establish that the said taxable value of Rs.4,54,64,051/- is consideration received for providing service. We examine further the charges levelled as stated above are sustainable or not. We will examine them with reference to the precedent decisions of this Tribunal relied upon by learned counsel for the appellant. For the sake of ready reference, we reproduce below para 4 of final order of this Tribunal in the case of Umesh Tilak Yadav reported at [2024] 159 taxmann.com 336 - CESTAT MUMBAI:- "4. We have carefully gone through the record of the case and submissions made. The demand was raised invoking the provisions of sub-section (1) of Section 73 of Finance Act, 1994. The said p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... account of provision of taxable service and by calculating 12.36% of that turnover, service tax demand was raised. The fundamentals of prosecution such as framing charges on the basis of admissible evidence is absent in issue of show cause notice. The basic of any proceeding is to frame charges on the basis of assessee's record and establish that the assesse has short paid calculated and pre-determined amount of service tax and then issue them a show cause notice calling for their explanation as to why the stated amount of service tax should not be recovered from them. The burden of proof is on Revenue to establish that the alleged service tax was short paid by the assesse. Unless such burden of proof is discharged by Revenue, such show cause notice cannot sustain. The preset show cause notice is totally presumptive. Further, the difference in turnover in ST-3 return and income tax return could be on account of non-taxable businesses. So, unless Revenue examines the reasons for the difference, it cannot demand service tax blindly on the basis of difference in the turnover reflected in the two statutory returns. This Tribunal has time and again held as follows:- a) In the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons [2019 (5) TMI 1248 - CESTAT ALLAHABAD], it was held as follows:- "After hearing both the sides duly represented by Shri A.K. Singh authorized representative of the appellant on behalf of the appellant and Shri Shiv Pratap Singh learned A.R. on behalf of the Revenue, we note that through impugned order service tax of Rs.93,000/- was confirmed alongwith equal penalty. On perusal of record, we note that the appellants were registered with the Service Tax Department and also they were filing ST-3 returns. Revenue has compared the figures reflected in the ST-3 returns and those reflected in Form 26AS filed in respect of the appellant as required under the provisions of Income Tax Act, 1961. We note that without further examining the reasons for difference in two, Revenue has raised the demand on the basis of difference between the two. We note that Revenue cannot raise the demand on the basis of such difference without examining the reasons for said difference and without establishing that the entire amount received by the appellant as reflected in said returns in the Form 26AS being consideration for services provided and without examining whether the difference was because of an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tablish that a specific amount to be demanded through show cause notice by invoking the said provision is service tax either not paid or short paid or not levied or short levied. Therefore, it is essential to establish that the value on which such service tax is calculated is the value under Section 67 and the same is derived from the consideration received by the appellant out of the activity which has to satisfy definition of service under sub-section (44) of Section 65B of Finance Act, 1994. Such type of examination of the facts and arriving at the prima facie view that the appellant had received the consideration by providing service is missing in the show cause notice. We, therefore, hold that the said show cause notice dated 26.06.2020 is not sustainable in law 8. Hence, in view of irregularity in the Show cause and the nonsustainability of demand purely on the basis of difference between ST- 3 return and Income Tax returns of any other period, without any further examination to establish that the difference is on account of consideration received towards discharge of services, the following order is passed. THE ORDER 9. The appeal is dismissed and the order passed by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubject show cause notice is held as non- sustainable, we set aside the impugned order passed by learned Commissioner (Appeals) and allow the appeal. (Order pronounced in the open court on 10.06.2024) ADDITIONAL NOTE ON CONCURRING ORDER : - I concur with the ultimate findings of the Hon'ble Member (Technical) in allowing the appeal primarily for the reason that there is no reference to the defence reply to the show cause made in the order passed by the Commissioner and nothing is mentioned as to if any reply to show cause was received at his end before commencement of hearing. To my considered opinion, the same forms the primary basis to confirm a demand raised in the show cause notice in view of clear provision contained in section 73 (2) of the Finance Act, 1994. Further, it is also found from the record that documents as sought for, from the Appellant were duly tendered and some sample invoices of purchase and sale were also filed but computation was made by the adjudicating authority in deducting the amount mentioned in the sample invoices from the figures available in income tax TDS data record. TDS Deductions made by twelve parties was noted against actual Deductions from t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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