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Case Law Details

Case Name : Applied Solar Technologies (India) Pvt. Ltd. Vs Commissioner, Central Goods & Service Tax (Audit-II) (CESTAT Delhi)
Appeal Number : Service Tax Appeal No. 50915 of 2019
Date of Judgement/Order : 20/01/2023
Related Assessment Year :
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Applied Solar Technologies (India) Pvt. Ltd. Vs Commissioner, Central Goods & Service Tax (Audit-II) (CESTAT Delhi)

The third issue that arises for consideration is regarding the invocation of the extended period of limitation in the show cause notice. The relevant portion of the show cause notice invoking the extended period of limitation is reproduced below:

“8. Whereas, from the facts discussed above, it further appears that the assessee, by doing so, had intentionally and willfully suppressed the details of providing/receiving that impugned taxable services and did not file prescribed ST-3 Returns containing the details correctly therein with the intention to short payment/non-payment of the applicable Service Tax on such services. Agreements were never shared by the assessee with the Department so that the nature of these advances could be ascertained from the agreements. Thus there is a clear case of suppression on the part of the assesssee. The assessee was aware about the nature of such advances as he had entered into different types of agreements for different kinds of advances/ security deposits but he has shown under a single heading in his Balance Sheet which reflects his intention to evade the Service Tax. These acts of omission and commission on the part of the assessee resulted in short payment/ non-payment of Service Tax as discussed under aforesaid paras.”

The Commissioner has recorded a finding that though the Agreement referred to the amount as advance but still the appellant made an attempt to treat it as a security deposit, which clearly shows that there was suppression of facts with an intent to evade payment of tax.

There is no error in the finding recorded by the Commissioner in this regard, as indeed the appellant did try to evade payment of service tax by treating the amount as a security deposit when in fact it was clearly an advance, which fact was very specifically mentioned in the Agreement. The intention to evade payment of service tax by suppression of material facts is writ large.

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July 2024