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TMI Blog2024 (2) TMI 1455X X X X Extracts X X X X X X X X Extracts X X X X ..... ceived. ribunal in a catena of decisions has held that it is well settled law that no demand can be confirmed by comparing the ST -3 returns with balance sheet figures, in the absence of any evidence to the contrary that income in the balance sheet, if excess, reflects the provision of taxable service. As it is the Revenue authorities who have made the allegations of on payment of tax, and as such, the onus to prove the said allegation lies with them to substantiate the allegations. In the case of SBI Life Insurance Company Limited [ 2024 (1) TMI 1161 - CESTAT MUMBAI ] Tribunal held that demand/penalty on the basis of difference between ST-3 Returns and Income tax returns of any period, without further examination to establish that the difference is on account consideration received towards discharge of services, cannot be sustained. Thus, hold that mere difference in figures appearing in the trial balance as compared to the ST 3 returns without any corroborative evidence that taxable services had indeed been provided by the appellant cannot be upheld. It is a fact on record that the appellant was filing his ST-3 returns regularly. The Department did not raise any query or seek any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in Show cause notice solely on figures as appearing in Trial Balance and ST-3 returns is not sustainable. The entire demand proposed in the SCN is based purely on the difference in value of ledger accounts as appearing in the books of accounts and the corresponding figures as reported in ST-3 Returns for the period in dispute, without examining the nature of the entries in the ledger accounts and without examining whether such amounts are for taxable services received /rendered. Consequently, the burden of proof lies on the Revenue as the allegations of short payment/nonpayment of service tax has been made without stating the reasons as to how the differential figures represent taxable services . 3.1 He further submitted that the difference in the figures as reported in the Ledger Accounts and those as appearing in the ST-3 returns are inherent, and was well within the knowledge of the Department, as for the period, prior to the period in dispute, no demand was ever raised on such differential figures. In this connection, he relied upon the following judgements:- Go Bindas Entertainment Pvt. Ltd. Vs. Commissioner of S.T., Noida, 2019 (27) GSTL 397 (Tri-All.), M/s Kush Construction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le to be set aside. 3.4 The learned Counsel further contended that invocation of extended period of limitation and penalty under Section 78 of the Finance Act 1994 is bad in law, as the entire demand proposed on differential figures of Ledger Accounts as appearing in the Trial Balance and as reported in ST-3 without even specifying the reasons as to how such differential figure represents the taxable services on which due service tax, as alleged, has not been paid. On such vague computation, the non-disclosure of such differential figures in ST-3 returns has been alleged as suppression of facts. Further, no positive evidence of suppression of facts coupled with intention to evade the payment of service tax is discernible from the show cause notice. For these submissions, he relied upon the following judgements: - M/s Vandana Global vs. Commissioner (Appeals) CGST, Central Excise Customs, Raipur in Excise Appeal NO. 53026 OF 2018 (Final Order NO. 51135 of 2022 dated 02.12.2022) Uniworth Textiles Ltd. vs. Commissioner of central Excise, Raipur 2013 (288) ELT 161 (SC) 3.5 On the issue of penalty under Section 78, Learned Counsel submits that it is a matter of settled position of law t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed with any reason/explanations. Evidently, the noticee have failed to provide any explanation of the said differences, but still persists following the process of reconciliation, as discussed above. Further, I find that in remaining cases the transaction values arrived at as per trial balance are less than the transaction values shown in corresponding ST 3 returns, which has resulted in excess payment of tax. In this context, it would be expedient to go through the provisions of rule 6(4A) of the service tax rules, 1994, .. 21.1. From the above provisions, it is clear that any amount of service tax paid in excess in a month or quarter to be adjusted in the succeeding month or quarter within the same year only. In the instant case, as per the reconciliation statements, the excess payment of taxes discussed above are related to a year, whereas the short payment tax are related to different year. As such, the excess payment of tax cannot be adjusted against the short payment of tax in terms of provisions of rule 6(4A) of the service tax rules, 1994. Accordingly, I arrive at the conclusion that where the transaction values arrived at as per Trial Balance are on higher side as compared ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the entire amount received by the appellant as reflected in the said returns in the Form 26AS being consideration for services provided and without examining whether the difference was because of any exemption or abatement, since it is not legal to presume that the entire differential amount was on account of consideration for providing services. We, therefore, do not find the said show cause notice to be sustainable. In view of the same is set aside the impugned order and allow the appeal. 6.1.1 In the case of Principal Commissioner, CGST vs. SBI Life Insurance Company Limited (2024 TIOL 202 CESTAT Mumbai), the Tribunal held that demand/penalty on the basis of difference between ST-3 Returns and Income tax returns of any period, without further examination to establish that the difference is on account consideration received towards discharge of services, cannot be sustained. 6.2 Following the above decisions, I hold that mere difference in figures appearing in the trial balance as compared to the ST 3 returns without any corroborative evidence that taxable services had indeed been provided by the appellant cannot be upheld. 6.3 Further, it is a fact on record that the appella ..... X X X X Extracts X X X X X X X X Extracts X X X X
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