Shree Kankeshwari Enterprise Vs Commissioner of Central Excise & ST (CESTAT Ahmedabad)
CESTAT Ahmedabad held that services related to construction of roads etc. the Government authorities/ agencies are covered under Mega Exemption of Service Tax notification no. 25/2012-ST and hence demand unsustainable.
Facts- Appellant is engaged in providing work contract Services to the State Government, local authority or governmental authority and also to private parties by way of construction of road, bridge, tunnel, ponds or irrigation work, Repairs and Maintenance of civil structure etc. Appellant is Registered as AA class Road contractor with Gujarat Government, providing service for construction/repair of Roads, Repairs and Maintenance of roads, civil structure etc. to R & B Department of Gujarat Government and Panchayat etc. in Gujarat and private parties.
Appellant had obtained Service Tax Registration and paid Service Tax, when taxable services were provided. Appellant has discharged service tax liabilities from time to time, filed all statutory ST-3 Returns. The Income Tax authorities shared Appellant‟s data of 26AS shown in Income Tax Returns. Perusing said data shared by Income Tax authorities, Central Excise officers at Bhavnagar noticed that the Appellant had short paid Service Tax for the F.Y. 2015-16 to 2016-17.
The Show Cause Notice demanding total Service Tax of Rs.4,02,21,381/- was issued on the basis of the said 26AS data. However, Order-In-Original confirmed the demand of Rs. 3,95,32,273/- with interest and imposed penalties on the Appellant. Hence, Appellant is before this Tribunal.
Conclusion-Eligibility criteria in this case is providing services to Government Authorities in public work on Roads, Bridges etc, which is not denied in this O-I-O. Appellant has given detailed clarification and documents for services and submitted that they are eligible for exemption by clause No. 12(d), 12(e), 12A(a), 13(a) and 29(h) of Notification No. 25/2012-ST which allows the exemption in services provided to the Government, a local authority or a governmental authority.
Department was fully aware of the facts that Appellant had paid Service Tax and filed ST-3 Returns for FY 2015-16 to 2016-17 intimating their claim of Exemption of Notification No. 25/2012-ST, department should have objected on availment of exemption within normal time limit, if revenue had any doubts on the availment of exemption. This being a case of interpretation of provisions, charge of suppression of facts, willful misstatement, fraud, etc., cannot be leveled, for initiation of SCN beyond the normal time limitation. It is settled law that there must be deliberate attempt by the Appellant to suppress the facts from Department with an intention to evade payment of Service Tax, which is not existing in this case.
FULL TEXT OF THE CESTAT AHMEDABAD ORDER
This appeal is directed against the impugned Order-in-Original No. BVR-EXCUS-000-COMM-009-2022-23 dated 14-09-2022. The issue involved in this Appeal is whether alleged Service Tax liability arises against the Appellant for the period during the F.Y. 2015-16 to2016-17 or otherwise.
2. Brief facts of the case are that Appellant is engaged in providing work contract Services to the State Government, local authority or governmental authority and also to private parties by way of construction of road, bridge, tunnel, ponds or irrigation work, Repairs and Maintenance of civil structure etc. Appellant is Registered as AA class Road contractor with Gujarat Government, providing service for construction/repair of Roads, Repairs and Maintenance of roads, civil structure etc. to R & B Department of Gujarat Government and Panchayat etc. in Gujarat and private parties. Appellant had obtained Service Tax Registration No: ABOFS6733MSD002 and paid Service Tax, when taxable services were provided. Appellant has discharged service tax liabilities from time to time, filed all statutory ST-3 Returns. The Income Tax authorities shared Appellant‟s data of 26AS shown in Income Tax Returns. Perusing said data shared by Income Tax authorities, Central Excise officers at Bhavnagar noticed that the Appellant had short paid Service Tax for the F.Y. 2015-16 to 2016-17. Superintendent of Central Excise, Bhavnagar requested Appellant vide letter No. AR-RJL/3rd party-DGARM/Reg/2020-21 dated 15-04-2021 to provide details of Income receipts and to submit documents related to Service Tax paid, which was not responded by the Appellant who claims not to have received the said letter dated 15-04-2021. The Show Cause Notice No.V/15-126/DEM/HQ/20-21 dated 19-04-2021 demanding total Service Tax of Rs.4,02,21,381/- was issued on the basis of the said 26AS data. However, Order-In-Original No. BVR-EXCUS-000-COMM-009-2022-23dated 14-09-2022 confirmed the demand of Rs. 3,95,32,273/- with interest and imposed penalties on the Appellant. Hence, Appellant is before this Tribunal by Service Tax Appeal No. ST/10921/2022-DB.
3. Shri P. P. Jadeja, Learned Authorized Representative, appearing for Appellant vehemently submits against SCN dated 19-04-2021 and that the demand confirmed by impugned Order-in-Original is not sustainable. He submits that Appellant as a Registered unit under Service Tax, has paid Service Tax and filed all statutory ST-3 Returns; that Appellant has provided services to the State Government, local authority etc. which wereexempted by Service Tax Notification No. 25/2012-ST vide Sr. Nos. 12(d),12(e), 12A(a), 13(a)and 29(h).SCN dated 19-04-2021 has not considered the facts and the Order-In-Original thereon is beyond SCN, which is not sustainable in the law, considering facts and exemption availed.
3.1 He also submits that it is settled principal of law that Service Tax demand cannot be raised on the basis of data of the Income tax Authorities, without conducting any independent enquiry. He submits that the data of Income Tax in 26AS relied upon in SCN/O-I-O does not have its evidentiary value in absence of any independent evidence. He submits that by relying 26AS data for demand of service tax cannot be made. He has relied upon the following decisions :-
