Anju Makhija Vs Commissioner (Appeals) (CESTAT Delhi)
Form 26AS Alone Cannot Sustain Service Tax Demand; Residential Rental and Trading Receipts Not Taxable Services; Service Tax Demand Based Solely on Income-Tax Data Quashed; No Extended Limitation Without Positive Evidence of Suppression: CESTAT Delhi
Summary: CESTAT New Delhi allowed the appeal of M/s Anju Makhija and set aside the service tax demand of Rs. 19,72,702/- for the period 2013-14 to 2015-16. The Department had proceeded principally on third-party information received from the Income Tax Department showing gross receipts of Rs. 1,40,65,334/- on which TDS had been deducted. According to the Department, the appellant was neither registered with the service tax department nor paying service tax, and the activities reflected in the income-tax information were not shown to fall within the negative list or an applicable exemption. The demand was therefore raised along with interest under Section 75 and penalties under Sections 77 and 78 of the Finance Act, 1994.
The appellant contended that the receipts could not automatically be treated as consideration for taxable services merely because they appeared in the income-tax return/Form 26AS. She had furnished a detailed reply to the Show Cause Notice explaining the actual nature of the receipts. According to her, amounts were received from commission activities and renting of immovable property for residential use, while certain trading receipts relating to M/s Sawariya Traders could not be attributed to her. The appellant also argued that the extended period was unavailable because the Form 26AS figures were already available with the Department and there was no evidence of fraud, wilful misstatement or suppression.
