Suppression Or Wilful Concealment Not Attributable To Assessee When Departmental Authorities Differ On Taxability Of Services: CESTAT

The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that suppression or wilful concealment not attributable when the departmental authorities have differed themselves on the taxability of the services. The Bench of Binu Tamta (Judicial) and P.V. Subba Rao (Technical) has observed that, “When the two departmental authorities have differed themselves on the taxability of the services under a specific category, no suppression or wilful concealment with intent to evade payment of duty can be attributed to the assessee.” In this case, the assessee is engaged in providing services to Nagar Nigam, Kota of labour supply for street light maintenance, laying cables, new light fittings on poles, erection of PCC/RCC Poles and drawing cables under various work orders. The Department found that the assessee is providing taxable services to Nagar Nigam, however, they neither obtained Service Tax Registration nor filed the Service Tax Returns As the assessee failed to provide necessary information, the Department issued a show cause notice on the services provided under the category of Manpower Recruitment and Supply Agency, Management, Maintenance or Repair Service and Erection, Commissioning or Installation Service. The Adjudicating Authority confirmed the demand. Aggrieved by the decision of Adjudicating Authority, the assessee filed an Appeal before Commissioner (Appeals) upheld the order of the Adjudicating Authority. The assessee has challenged the order passed by the Commissioner (Appeals) before the Tribunal The assessee contended that the services provided by them were under the Bonafide belief that no service tax was payable on the value of the services rendered by them to Nagar Nigam as the services were not for commercial or industrial use and, therefore, nonpayment of service tax is not intentional. Whereas it was contended by the department that the assessee had not cooperated with the investigation and have not submitted any documents, as a result, the Department had no recourse but to rely on the documents procured from the Nagar Nigam. The Tribunal pointed out that the invocation of the extended period is not justified in the absence of any strong allegation or positive act, pointing towards fraud, collusion, or any wilful mis statement or suppression of facts with intent to evade payment of duty. So, the extended period is not invokable, and no penalty is imposable on the assessee. The Tribunal opined that “The peculiar facts of the present case also do not justify invocation of the extended period of limitation for the simple reason that the Adjudicating Authority had made the services taxable under the category of “Management, Maintenance or Repair Service‟, whereas the Adjudicating Authority had classified them under “Manpower Recruitment and Supply Agency Service” In view of the above, the Tribunal allowed the appeal and remanded back to the Commissioner (Appeal) to re-consider the issues. Counsel for Appellant/ Assessee: Vijai Kumar Counsel for Respondent/ Department: Jaya Kumari Case Title: M/s Bhardwaj Construction and Electricals Versus Commissioner of CGST and, Service Tax, Excise and Customs Case Number: Service Tax Appeal No. 50967 OF 2017 Click Here To Read/Download Judgment

Suppression Or Wilful Concealment Not Attributable To Assessee When Departmental Authorities Differ On Taxability Of Services: CESTAT

Mehak Dhiman

This is a premium content
Available exclusively to
Our subscribers

INR 1099+GST

Tags

Mehak Dhiman

Suppression Or Wilful Concealment Not Attributable To Assessee When Departmental Authorities Differ On Taxability Of Services: CESTAT

Mehak Dhiman

This is a premium content Available exclusively to Our subscribers

INR 1099+GST

Tags

Mehak Dhiman

This is a premium content
Available exclusively to
Our subscribers