Surendra Gundu Shetty Vs Commissioner of Cen. Excise & ST (CESTAT Mumbai)
In a recent decision, the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) Mumbai ruled in favor of Surendra Gundu Shetty, a fruit seller, who was erroneously issued a show cause notice (SCN) demanding service tax payment.
The appellant, Surendra Gundu Shetty, who operates a fruit-selling business, was accused of failing to pay service tax for the period from April 2015 to June 2017. A show cause notice dated December 4, 2020, was issued based on data from the Central Board of Direct Taxes, alleging that Shetty’s activities were not covered under the negative list of services and thus subject to service tax. However, Shetty did not receive this notice as it was sent to an incorrect address in Vashi, Navi Mumbai, while his business was actually located in Dombivli, Thane.
Upon receiving the final order dated March 19, 2022, only in November 2022, Shetty promptly contested it. The Commissioner (Appeals) dismissed his appeal as time-barred, citing the delay in filing. However, the CESTAT Mumbai found that the initial notice and order were improperly served. The tribunal noted that the appellant’s business activities fell under the negative list as per Section 66D of the Finance Act, 1994, which excludes trading of goods from service tax.
