Principal Commissioner of Central Goods And Service Tax And Customs Vs Numal Saikia (Gauhati High Court)
The Gauhati High Court considered an appeal challenging the Final Order dated 11.08.2022 passed by the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Kolkata, in Service Tax Appeal No. 75969/2021. The dispute concerned the levy of Service Tax on works executed by the respondent for various Government authorities, including the PWD, Airport Authority of India, and Indian Railways, for the period 2014–2015 to 2017–2018.
A show cause notice-cum-demand notice dated 21.01.2019 was issued under Section 67 of the Finance Act, 1994, primarily relying on data reflected in Form 26AS under the Income Tax Act for the period 2013–2014 to 2017–2018. The respondent replied to the Principal Commissioner, CGST, contending that the works were covered under Entries 12A, 13, and 14 of the Mega Exemption Notification No. 25/12-ST dated 20.06.2012. The reply included work orders and related documents but not invoices. By order dated 22.10.2021, the Principal Commissioner, CGST, Dibrugarh confirmed a Service Tax demand of ₹6,39,09,190/-.
On appeal, CESTAT set aside the adjudication order on two grounds: first, that Service Tax could not be levied solely on the basis of Form 26AS data; and second, that mandatory pre-show cause notice consultation under the Master Circular dated 10.03.2017 had not been conducted. The Principal Commissioner filed the present appeal raising three substantial questions of law: whether pre-show cause consultation was mandatory in view of Circular dated 11.11.2021; whether Service Tax could be demanded based on Form 26AS; and whether the show cause notice violated CBIC instructions.
