Tamil Nadu Housing Board Vs Commissioner of Central Excise (CESTAT Chennai)
CESTAT Chennai held that extended period of limitation rightly invoked as collection of service tax but withholding the same without remitting to appropriate Government account establishes intention to evade payment of tax.
Facts- The appellant, a body duly constituted by an Act of the Tamil Nadu Legislative Assembly, I engaged in the construction of houses / apartments and allotting dwelling units to eligible persons.
During the scrutiny of records, it was noticed that the appellant was collecting charges towards services like maintenance or government rental quarters, supervision charges collected as a percentage of the maintenance charges, testing charges for testing materials like steel, cement, etc. from the Chennai Corporation for works undertaken by the appellant.
As per revenue, the said services were liable for service tax under different categories. It is noticed that the assessee had not registered with the Department for the services under the respective categories and had also not paid any Service Tax on such services rendered by them to various clients.
Conclusion- The Revenue has not specifically pointed out as to which limb of the above categories covers the scope of the alleged services rendered by the appellant. In the impugned order also, the Commissioner has only referred to Section 65(105)(zzb) which only states – a service to be rendered to a client, by any person, in relation to BAS; and that limb of BAS is not specifically identified by him.
Held that unless a specific charge/service is alleged, put across in the Show Cause Notice and the scope of the services alleged to have been rendered by the appellant stands examined in the context of such service, mere allegation alone is not sufficient to fasten with tax liability.
Held that it is a clear case of suppression of facts, collecting / deducting Service Tax but withholding the same without remitting to the appropriate Government account, the same has also established the intent to evade payment of tax. In view of the above, the extended period of limitation has been rightly invoked and hence, to this extent also, the impugned order is correct.
FULL TEXT OF THE CESTAT CHENNAI ORDER
1. These appeals are filed by the assessee-appellant against the Orders-in-Original Nos. 06 & 07/2012 dated 28.03.2012 passed by the Commissioner of Central Excise, Chen nai-I Com missionerate, Order-in-Appeal No. 332/2015 (STA-II) dated 27.11.2015 passed by the Commissioner of Service Tax (Appeals-II), Chennai and Orders-in-Original Nos. CHN-SVTAX-002-COM-4 to 7- 2016-17 dated 25.01.2017 passed by the Commissioner of Service Tax-II, Chennai.
2. After hearing both sides, we find that common issues are involved and hence, all the cases are considered for common disposal.
2.1 Facts in brief, as could be gathered from the impugned Order-in-Original dated 28.03.2012, are that the appellant, a body duly constituted by an Act of the Tamil Nadu Legislative Assembly, is engaged in the construction of houses / apartments and allotting dwelling units to eligible persons. They are also engaged in renting of commercial complexes and community centres throughout the State of Tamil Nadu for commercial purposes and the appellant is also registered with the Service Tax Department for the provision of services under the category of “renting of immovable property”.
2.2 It appears that the Department carried out a scrutiny of the records and returns filed by the appellant, during which time they appeared to have noticed that the appellant was collecting charges towards various services provided by them, namely: –
(1) Maintenance of Government Rental Quarters;
(2) Supervision charges collected as a percentage of the maintenance charges;
(3) Testing charges for testing materials like steel, cement, etc.
from the Chennai Corporation for the works undertaken by the appellant.
2.3 From the above, it appeared to the Revenue that the above activities of the appellant for which income was received, were liable for Service Tax under: –
(1) Renting of Immovable Property
(2) Management, Maintenance or Repair (MMR)
(3) Business Auxiliary Service (BAS) and
(4) Technical Inspection and Certification Agency (TIC)
It is a fact borne on record that the assessee had not registered with the Department for the above services under the respective categories and had also not paid any Service Tax on such services rendered by them to various clients.
2.4 In the light of the above, it appears that the following Show Cause Notices were issued proposing inter alia to demand Service Tax on the above services: –
(1) Show Cause Notice No. 289/2010 dated 21.04.2010 for the period from 2004-05 to 2008-09;
(2) Show Cause Notice No. 167/20 11 dated 08.04.2011 for the period from April 2009 to March 2010.
2.5 There is no dispute that the Show Cause Notices were issued after invoking the extended period of limitation and it appears that the appellant had filed its reply dated 05.07.2011 contending as under: –
