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2022 (4) TMI 735 - AT - Service TaxLevy of Service Tax - Construction service - cash amount deposited in Bank and income disclosed under Income Disclosure Scheme (IDS), 2016 - Circular No. 1053/02/2017-CX dated 10.03.2017 - HELD THAT:- The revenue has not come forward with the evidence that the Appellant have generated the disputed income on account of providing taxable service. Therefore in absence of concrete evidence on record, the service tax cannot be demanded on the basis of assumption and presumption.The department has not been able to support their allegation with evidence that the said disclosed income under IDS scheme were collected for providing services of construction Service. There is merit in the contention of the appellant that it is settled principal of law that the burden of proving a fact is on the person who alleges the same but the department did not produce any evidence on record to prove that the disclosed Income under Income Tax Disclosure Scheme, 2016 pertained to construction activity and that the charges of income was generated out of taxable activity without any evidence was not sustainable in the absence of cogent, convincing and tangible evidences. Income tax and service tax are two different/ separate and independent special Act and their provisions operating in two different fields. Therefore by relying the income disclosed in income tax provision, without undertaking any independent investigation under the Service Tax Act, demand of service tax cannot be made. In the case of M/S. RAVI FOODS PVT. LTD. & OTHERS VERSUS CCE, HYDERABAD [2010 (12) TMI 290 - CESTAT, BANGALORE], it was held that admission by assessee to Income Tax department as regards undisclosed/suppressed sales turnover cannot be held to be on account of clandestine removal of their final products, in the absence of any other corroborative evidence. The meaning of “income” has been defined under Section 2(24) of the Income tax Act, 1961 is very wide and it cover all types of Income. Income can also be earned from taxable, non-taxable, exempted activity. The provisions of Income-tax Act and IDS scheme are having specific scope, purpose and intent, as decided by the legislature. Further, under the Income tax, income declared by the assessee cannot be assumed that the said income earned from taxable service only, whereas under the income tax “income” have wide meaning. In the present matter department‟s allegation that the income disclosed under the IDS scheme is attributable to construction services provided to their clients/ customers is based on the assumption that Appellant have no other activity except construction service. In the present matter Appellant also produced the details of payment received after obtaining Business use (BU) i.e. sales of flats, shop etc. after receipt of the completion certificate. Therefore it cannot be said that the income declared by the Appellant under IDS Scheme is attributable to the taxable service provided by them to their clients. In this case, evidence gathered by the Department is not sufficient to establish even the preponderance of probability. Therefore, the demand on the ground that the income declared under IDS scheme is earned from the taxable service is not sustainable. Appeal allowed - decided in favor of appellant.
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