9911796707
TMI Blog2025 (1) TMI 788X X X X Extracts X X X X X X X X Extracts X X X X ..... - (i) Services relating to development of plots : The respondent was found engaged in the purchasing the agriculture land from the land owners and surrendering the same to the Jaipur Development Authority (JDA) for approval under 90B & 90A and after JDA approves the map, they issue patta to booking holder and thereafter on behalf of their patta, JDA issues patta. On verification of the records the respondent was found to have charged and collected sums from their customers/clients for the development of land/plots/shops, in addition to the sale value of the plots/shops. These sums were recorded in their books of accounts as "Land Development Receipt." The department formed an opinion that these activities fall under the definition of 'service' as per Section 65B(44) of the Finance Act, 1994, and considered those as taxable services under Section 65B(51) of the Act. (ii) Works Contract Services: The Respondent is a recipient of WorksContract Services where both the service provider and recipient are located in India. As per Section 68(2) of the Act read with Rule 2(I)(d)(i)(t)(c) of the Service Tax Rules, 1994, and Notification No. 30/2012-ST dated 20.06.2012, as amended, M/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Finance Act 1994. While adjudicating the said Show Cause Notice the original adjudicating authority vide Order in Original (O-I-O) no. 47-17-18 dated 22.03.2018 had accepted the said proposal except that the demand of Rs. 7416000/- on an amount of Rs. 6 crores (miscellaneous income received in the disputed period) which was surrendered to Income tax department on the ground of access cash found from the premises of the respondent during survey by income tax department. With respect to remaining three proposals i.e. demand on development charges, for providing work contract service and for receiving rent-a-cab service, the original adjudicating authority has held that the respondent was providing taxable services without discharging their service tax liability. Hence has confirmed the remaining demand. Being aggrieved of dropping of demand of Rs.74,16,000/-, the department has filed the present appeal. 2. The respondent has not appeared in this matter though the notice of hearing, initially, was unserved upon the respondent however the department got the same served later. The copy of receipt of notice is placed on record by the department. After the said service, more than four ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the charge has been proposed to be sustained in absence of documentary proof of purchase and sale of land. The fact of the matter is once the Noticee admitted non-accounted income and declared the same during the course of survey proceedings (of income Tax Deptt.) they were not under any legal obligation to produce documents. It is simple common sense that unaccounted for income can be generated only in those cases where the transactions have not been taken on record and, therefore, seeking documentary proof of what has not been taken on record, it too harsh and arbitrary as the same can never be available on record. The Noticee has submitted a ledger account of miscellaneous income for the period 01.04.2012 to 31.03.2013 wherein entries of cash receipts against miscellaneous income have been made. The miscellaneous income pertains to he period 15.04.2012 to 09.08.2012 and debited to the cash account. Cash receipt vouchers have also been placed on record again reflecting miscellaneous income. Nature of the source of such income has been declared by the Noticee during the course of assessment proceedings and accepted by the income tax authorities. The Noticee have also submitted a l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ties. Consequently, the demand of Rs. 74,16,000/- of service tax on 'Real Agent Agent's Service' does not sustain and deserves to be dropped." 6. We observe from the above paragraph of O-I-O that the demand in question was dropped on the ground that department had not provided any evidence to indicate any connection between the miscellaneous income of Rs. 6 crores declared to IT department with any taxable service provided / receipt by the respondent. We further observe that the present demand was proposed based on the statement of the director of the respondent where he simply stated that the amount disclosed to IT department was received from construction services. Apparently and admittedly, the respondent was providing various taxable services the said statement is not admissible in evidence till corroborated by any documentary evidence. Subsequent to the impugned order also the department has not produced any evidence to prove that the respondent had generated said disputed income / amount disclosed to IT department on account of providing taxable services. The proposal of demand of service tax on the income declared under survey to IT department cannot otherwise sustain. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er than the declared consideration for taxable service. We not that the appellants categorically asserted that they did not provide any other service other than those, the details of which have been submitted to the lower authorities. The Revenue also could not print out excess receipt on these contracts or the taxable service which gave them the consideration escaping the tax. In the absence of specific allegation with reference to the nature of service or the service recipient it is not tenable to hold an income of the appellant even if it is admitted to be an actual income, as consideration for a taxable service. The minimum requirement to tax an assessee for service tax is to identify the nature of their taxable service along with the recipient of such service. In the present case all identified contracts for the identified service recipients have been examined and concluded by the lower authority. No service tax liability can be fastened on unidentified service for unidentified service recipient. There is no provision for such summary assumption even under Section 72 of the Finance Act, 1994. Admittedly, the said section provides for arriving at the taxable value to be based o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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