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TMI Blog2024 (7) TMI 185X X X X Extracts X X X X X X X X Extracts X X X X ..... r Sl No 13 of the said notification before the original authority which has been rejected only in specific cases and appellant has not challenged the rejection at the time of argument of the appeal. The demand made in respect of the services provided by the appellant to the said trust have been held to be exempted where the services were for charitable causes in terms of the said notification under that entry. There are no merits in the submissions made by the appellant in this respect. Demand made in respect of the services provided to M/s Madhucon Projects in relation to construction of toll Plaza at Jaipur Highway - HELD THAT:- It is evident that the demand has been confirmed for the reasn that appellant were unable to substantiate their claim that they were providing the services to M/s Madhucon Project for construction of Toll Plaza by way of a proper certificate. Impugned order records the reason for rejection of the said certificate. The said certificate which was produced have not be produced before us in this appeal. Instead a copy of work order dated 18.10.2010 given by M/s Madhucon Projects Limited to appellant has been produced. This work order is in respect of Construc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pplicable rates under Section 75 o the Act. I drop rest of the demand; 2. I also order to appropriate the service tax amounting to Rs 62,507.00 (Rupees Sixty Two Thousand Five Hundred and Seven only) deposited by the noticee against the above confirmed demand; 3. I also impose a penalty of Rs 36,44,549.00 (Rupees Thirty Six Lakh Forty Four Thousand Five Hundred and Forty Nine only) upon the noticee under Section 78 of the Finance Act, 1994; 4. I confirm the demand of late fee amounting to Rs 2,20,000 (Rupees Two Lakh Twenty Thousand only) from the noticee under Rule 7C of the Service Tax Rules, 1994, 5. I also impose a penalty of Rs 20,000.00 (Rupees Twenty Thousand only) upon the noticee under Section 77(1)(a), 77(1)(b) and 77 (2) of the Finance Act, 1994 2.1 Appellant is registered with and is providing/ receiving services under taxable category of Work Contract Services and Legal Consultancy Services 2.2 Investigations undertaken revealed that appellant had not paid service tax on the services provided by them to M/s Amar Nath Ashram Trust, UP State Construction and Infrastructure Development Corporation Ltd, Bulandshahar, Thakur Giriraj Ji Maharaj Trust, Govardhan, Jal Nigam, M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 20.06.2012. Reliance on decisions in case of Kanwarji Construction Co [2017 (12) TMI 1379 CESTAT New Delhi Ratan Das Gupta Co [2017 (3) GSTL 247 (T-Del)] Anand Construction Co [2013 (32) STR 451 (T-Del)] The services provided by them to the M/s Amar Nath Trust and also M/s Ginni Filament are work contract services on which service tax liability is to be computed on 40% of the Gross Amount charged. Impugned order holds these services as repair and maintenance and computed service tax on 70% of gross value. They have deposited the service tax payable on the services provided to M/s Ginni Filament by computing the tax payable on 40 % of gross amount. Services provided by them to M/s Madhucon Projects are in relation to construction of toll Plaza at Jaipur Highway. These services being in relation to road are excluded from the definition of work contract services as defined under Section 65 (105) (zzzza) of the Finance Act, 1994. Reliance on Rajendra Singh Bhamboo [2019 (22) GSTL 278 (T-Del)] Jagdish Prasad Agarwal [2017 (3) GSTL 455 (t-Del)] IDAA Infrastructure Pvt Ltd. [2014 (34) STR 87 (T-Mum)] Roller Centrevs [2013 (31) STR 293 (T-Ahmd)] Circular No 147/16/2011-ST dated 21.10 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... c) of Notification No. 25/2012-S dated 20.06.2012 only construction related work in respect of building owned by an entity registered under section 12AA of the Income Tax Act, 1961 and meant predominantly for religious use by general public are exempted from payment, of service tax. Here the noticee has constructed college/ hostel building and other misc. construction work, thus the services provided by Noticee to Amar Nath Ashram Trust are leviable to service tax. As per Point (i) of second proviso to Rule 3 of the Point of Taxation Rules, 2011, in case of continuous supply of service where the provision of the whole or part of the service is determined periodically on the completion of an event in terms of contract, the date of completion of each such event shall be deemed to be the date of completion of provision of service. Accordingly the taxable value of such services provided by the noticee on or after 01.07.2012 is calculated as per Form 26AS of noticee as under: TABLE-A Details of Work Contract Service provided by Noticee to Amar Nath Ashram Trust, Mathura on or after 01.07.2012 (Amount in ₹) Sl. No. Period/ Financial Year Service provided in respect of construction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icee. From the documents available on record , it has also been proved that the noticee have failed to file the required periodical returns in time as such the noticee is liable to penal action under Rule 7C of the Service Tax Rules, 1994 as well as Section 77 of the Act ibid. 30.1 I find that there are evidences on records which show that the noticee had knowingly and willfully suppressed material facts. The noticee failed to bring the relevant facts as outlined above to the notice of the Department. If the enquiry would not have been initiated against the noticee, this evasion of Service Tax by the noticee has remained un-noticed and the noticee would have succeeded in evading the payment of service tax. Therefore, the noticee, with intent to evade payment of Service Tax, had willfully suppressed the facts from the department and contravened various provisions of the Act and the Rules made there under. Hence, the noticee is liable for penal action under Section 78 of the Act. 31. On the basis of above discussion, the taxability on services provided by the noticee (as detailed in Table-B) and service tax liability thereon (as detailed in Table-C) comes as under Table A (Amount in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 06067.60 TOTAL 22510401 15757280.70 370766.15 1576833.75 F Y 2013-14 1 Ginni Filaments Ltd 902266 631586.20 12.36% 39032.03 39032.03 2 Ginni Filaments Ltd. 1935082 1354557.40 12.36% 83711.65 83711.65 3 Amar Nath Ashram Trust, Mathura 12938754 9057127.80 12.36% 0.00 1119461.00 Total 15776102 11043271.40 122743.67 1242204.67 F Y 2014-15 1 Ginni Filaments Ltd 3359598 2351718.60 12.36% 145336.21 145336.21 2 Ginni Filaments Ltd. 2229505 1560653.50 12.36% 96448.39 96448.39 3 Amar Nath Ashram Trust, Mathura 5392625 3774837.50 12.36% 0.00 466569.92 Total 10981728 7687209.60 12.36% 241784.60 708354.51 Grand Total 52111813 37331343.70 12.36% 735294.42 3644548.51 32. For calculation of penalty under Section 78 of the Act, I find that under first proviso to the section 78 of the Act there is provision that between the period from 08.04.2011 to date of enactment of Finance Act, 2015 (i.e. 14.05.2015), if the details relating to transactions, are recorded in specified records maintained under any other law, the penalty imposable under Section 78 is only 50% of tax evaded. Since the noticee has failed to submit any statutory records showing that these amounts of various services provided by them ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vices cannot thus be justified and needs to be rejected. 4.4 In respect of demand made in respect of the services provided to M/s Madhucon Projects from te impugned order it is evident that the demand has been confirmed for the reasn that appellant were unable to substantiate their claim that they were providing the services to M/s Madhucon Project for construction of Toll Plaza by way of a proper certificate. Impugned order records the reason for rejection of the said certificate. The said certificate which was produced have not be produced before us in this appeal. Instead a copy of work order dated 18.10.2010 given by M/s Madhucon Projects Limited to appellant has been produced. This work order is in respect of Construction of Toll Booth at Bharatpur Jaipu Highway including all finishing size 1.5 X 3.00 m . This work order do not specify any thing in respect of road construction contract between NHAI and M/s Madhucon Projects. We on the basis of the above work order are not in position to hold that appellant while undertaking the said work were acting as sub contractor to the main contractor in relation to construction of road. In absence of any evidence to the contrary we do no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... benefit of exemption under Sl No 9 of the Notification No 25/2012-ST is not admissible to them. None of these decisions have decided the issue in post negative list era. 4.6 Appellants did not challenged the demand made in respect of the services provided by the appellant to M/s Ginni Filament before the original authority or before us. There only contention before us is in respect of computation of the service tax payable. In view of the observations made in para 4.3 supra we do not find merits in the appellant challenge to the computation of the tax liability. 4.7 It is fact on record that though appellants were providing the taxable services they had never taken the registration nor had filed any return during the period under dispute. They were also not paying the service tax due. We find that in absence of any registration and filing of the returns the appellant have suppressed the relevant information with intent to evade payment of service tax due and extended period of limitation has been rightly invoked for making this demand. Reliance placed on the decisions in case of,- o Jitendra Lalwani [2017 (51) STR 312 (T-Del)] Kamal Lalwani [2017 (49) STR 552 (T-Del)] do not suppo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... if a person 16illful16y fails to furnish in due time the return of income required under Section 139(1), he shall be punishable with rigorous imprisonment for a term which may extend to one year or with fine. It is clear that in the former case what it intended is a civil obligation while in the latter what is imposed is a criminal sentence. There can be no dispute that having regard to the provisions of Section 276C, which speaks of 16illful failure on the part of the defaulter and taking into consideration the nature of the penalty, which is punitive, no sentence can be imposed under that provision unless the element of mens rea is established. In most cases of criminal liability, the intention of the Legislature is that the penalty should serve as a deterrent. The creation of an offence by Statute proceeds on the assumption that society suffers injury by and the act or omission of the defaulter and that a deterrent must be imposed to discourage the repetition of the offence. In the case of a proceeding under Section 271(1)(a), however, it seems that the intention of the legislature is to emphasise the fact of loss of Revenue and to provide a remedy for such loss, although no do ..... X X X X Extracts X X X X X X X X Extracts X X X X
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