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TMI Blog2025 (1) TMI 1262X X X X Extracts X X X X X X X X Extracts X X X X ..... of Rs.63,08,221/- along with interest and imposed equal amount of tax as penalty. The impugned order has also confirmed recovery of irregular CENVAT credit amounting to Rs.3,69,162/- along with interest and equal amount of irregular credit as penalty. 2. The issues involved in the demand of Service Tax and availment of irregular credit, are as under: - Sl. No. Description of Service Service Tax (Rs.) Cess (Rs.) Total (Rs.) 1 "Support service of Business or Commerce" On the amount received against Cost sharing of the expenses incurred by the appellant on behalf of the group Companies 60,39,000 1,81,170 62,20,170 2 Rental income On the differential value between P&L and ST-3 48,678 1460 50,138 3 Car ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that demand of Service Tax on cost sharing is not sustainable. 3.2. The appellant also submits that the issue is covered by the decision of the CESTAT, Ahmedabad in the case of Hazira Lng Pvt. Ltd. v. Commissioner of Service Tax, Ahmedabad [Final Order No. A/11349/2022 dated 02.11.2022 in Service Tax Appeal No. 596 of 2011 - CESTAT, Ahmedabad]. 4. Regarding the demands of service tax of Rs.50,138/- Rs.22,032/- and Rs.15,881/-, totalling to Rs.88,051/-, the appellant submits that these demands have been raised on the differential value of Profit & Loss Account and ST-3 returns. The appellant submits that they had categorically submitted before the ld. adjudicating Authority that such difference was due to different method of accounting; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rranted. In support of their claim, the appellant relied on the decision by Tribunal, Kolkata in the case of Balajee Machinery v. Commissioner of C.G.S.T. & Excise, Patna-II [2022 (66) G.S.T.L. 440 (Tri. - Kol.)]. As the entire demand is barred by limitation, the appellant contends that the demand confirmed on this count is not sustainable. 6. Thus, the appellant prayed for setting aside the demands and allowing their appeal. 7. The Ld. Authorized Representative of the Revenue reiterated the findings in the impugned order. 8. Heard both sides and perused the appeal records. 9. Regarding the demand of Service Tax of Rs.62,20,170/- on cost sharing among the group Companies under the category of 'Business Support Service', we obser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xpenditure, both the parties agreed that there should be a common pipeline. Once HCN is received through the said common pipeline, it comes first to GSFC's premises and from there it is diverted in the ratio of 60 : 40, meaning thereby that GSFC receives 60% of the HCN whereas GACL receives 40% of the supply in accordance with their respective requirement. To enable GACL to receive this HCN through common pipeline, arrangement/agreement was entered into between these two parties. For this purpose, handling facilities were installed in the premises of GSFC. However, fact remains, for which there is no dispute, that for installation of these facilities both the parties had contributed towards the investment. Since the said handling facilities ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tegory of 'Business Support Service' is not sustainable and accordingly, we set aside the same. 10. Regarding the demand of service tax of Rs.88,051/-, we observe that these demands have been raised on the differential value of Profit & Loss Account and ST-3 returns. The appellant submitted that the Profit & Loss Account is prepared on accrual basis whereas Service Tax is payable on receipt basis and thus, there is a difference between the values declared in the ST-3 and Profit and Loss Account. We observe that the ld. adjudicating authority has not given any finding regarding the liability of service tax on the differential value. It is the settled position of law that demand of Service Tax cannot be confirmed merely on the ground ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its VAT return on which VAT has been paid at applicable rate. From the above, it appears that the major demand has been computed on the sales turnover." 10.1. Thus, by relying on the decision cited supra, we hold that the demand of service tax of Rs.88,051/-, confirmed merely on the basis of the differential value between the Profit & Loss Account and ST-3 returns is not sustainable and accordingly. we set aside the same. 11. Regarding the demand of Rs.3,69,162/- confirmed in the impugned order on account of ineligible CENVAT Credit, we find that the issue was raised on scrutiny of ST-3 return for the year 2007-08. It is alleged that the appellant have taken CENVAT credit amounting to Rs.3,55,108.00, but failed to produce the copies of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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