Ajitabh Mishra Vs Commissioner of Central Excise & CGST (CESTAT Delhi)
Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) Delhi has recently set aside a service tax demand against civil contractor Ajitabh Mishra, ruling that the extended period of limitation cannot be invoked when the demand is based solely on information obtained from Income Tax Department disclosures. The case, Ajitabh Mishra Vs Commissioner of Central Excise & CGST, involved a service tax demand of Rs. 16,38,964 for the period 2013–2014. The demand originated from discrepancies identified through Income Tax returns, where Mishra had declared receipts from construction activities. The appellant contended that these receipts were either exempt, pertaining to single residential units, or for charitable construction (Samudhayik Bhavan funded by government schemes). Crucially, Mishra argued that since all income details were duly reflected in his Income Tax returns and balance sheets – public documents accessible to the Revenue – there could be no allegation of suppression of facts, fraud, or collusion that would justify invoking the extended limitation period beyond the normal 18 months.
The CESTAT, after considering the arguments, emphasized that the Revenue failed to produce any evidence of malafide intent or suppression on the part of the appellant. Citing a series of judicial precedents, including C.S.T., New Delhi Vs. Kamal Lalwani, Shri Balaji Industrial Products Ltd. Vs. Commr. Of Cus. & C. Ex., Jaipur, and Antares Services Pvt. Ltd. Vs. Commissioner of C. Ex., Chandigarh, the Tribunal reiterated a settled principle: if a declaration has been made with the Income Tax Department, no suppression of facts can be attributed to the assessee for service tax purposes. The CESTAT noted that Mishra had a bonafide belief that his services were not taxable, a belief substantiated by the full disclosure of receipts in his financial records. Given that the show cause notice for the 2013-2014 period was issued in October 2018, significantly beyond the normal 18-month limitation, the Tribunal concluded that the extended period was not invokable. Consequently, the entire demand was quashed on the grounds of being time-barred, rendering it unnecessary for the Tribunal to delve into the merits of the exemption claims.
