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2021 (10) TMI 95 - CESTAT ALLAHABADRejection of sales turnover - Non-filing of returns - It appeared to Revenue that the appellant have submitted ST-3 returns only for the period April, 2015 to September, 2015 (filed on 08.04.2018) and the other three half yearly returns were not found on the electronic record, and it appeared such returns have not been filed - HELD THAT:- There is no such assumption and presumption available to the Adjudicating Authority for rejection of sales turnover. Even a best judgment assumption has to be based on documents and information on record. Further after going through the provisions of Section 40A(3A) and (4), it has been provided - where an allowance has been made in the assessment for any year in respect of any liability incurred by the assessee for any expenditure, and subsequently during any previous year the assessee makes payment in respect thereof, otherwise than by an account payee cheque drawn on a bank or account payee bank draft, the payment so made shall be deemed to be the profits and gains of business or profession and accordingly chargeable to income tax as income of the subsequent year, if the payment or aggregate of payments made to a person in a day, exceeds twenty thousand rupees - such provisions of Section 40A(3A) of the Income Tax Act, have no relevance for the purpose of determination of liability under the provisions of service tax. Revenue cannot deny the giving of credit for the challan(s) deposited during investigation, or tax paid using cenvat credit. The respondent - Revenue is directed to reconcile the challan(s) with the assistance of the appellant and to give credit of each and every challan deposited by the appellant. Accordingly, this ground is also allowed in favour of the appellant. The substantial demand set aside, penalty under section 76 is set aside. Penalty under section 77(2) is reduced to ₹ 5,000/- per return or ₹ 15,000/- in total. Penalty under section 70 read with Rule 7C of Service Tax Rules is reduced to ₹ 5,000/-. Appeal allowed.
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