Case Law Details
Saumya Developers Vs C.C.E. & S.T.-CGST & Central Excise (CESTAT Ahmedabad)
Saumya Developers, in a legal battle against the Central Excise authorities, challenged a Service Tax demand of Rs. 18,10,742/- along with interest and penalties, as upheld by the Order-In-Appeal. The crux of the issue revolved around whether Saumya Developers were liable to pay this demand.
The case originated from a Show Cause Notice issued on March 25, 2021, for the fiscal years 2015-16 to 2017-18, based on data shared by the Income Tax authorities. The subsequent Order-In-Original confirmed the Service Tax demand, leading Saumya Developers to appeal the decision. The appeal was partially allowed by the Order-In-Appeal, upholding a reduced Service Tax demand. Dissatisfied, Saumya Developers brought the case before the CESTAT Ahmedabad.
Shri P.P. Jadeja, representing Saumya Developers, contended that the Service Tax demand was unsustainable due to several reasons. Firstly, the Show Cause Notice was flawed and lacked essential details, rendering subsequent orders invalid. Secondly, the demand was based solely on Income Tax data without independent inquiry, which is essential for a valid Service Tax demand. Moreover, the order exceeded the scope of the Show Cause Notice, making it legally untenable. Additionally, Saumya Developers argued that they hadn’t sold any residential units, thus absolving them of Service Tax liability under the Construction of Residential Complex services.
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