TMI Blog2022 (7) TMI 656X X X X Extracts X X X X X X X X Extracts X X X X ..... Forward Resources Pvt. Ltd., department seized the records/documents containing Income tax TDS statements of Appellant. It is mandate of law that presumption of documents in certain cases under Section 36A of the Central Excise Act is available only when the documents are produced by or seized from the custody or control of the person concerned. In view of Section 36A of Central Excise Act, 1944 it is only when such document is tendered in evidence against the person who produced the same or from whose custody or control it was seized that the presumption under Section 36A is available - In the present case admittedly none of the alleged invoices / documents was produced by the Appellant or seized from the Appellant s premises or control. When the presumption under Section 36A is not available, the burden of proof is squarely on the Department to prove that the source documents are related to the Appellants and that any taxable services under the source documents were actually provided by the Appellant. This burden has not at all been discharged in the present case. The department could not have simply accepted the customers documents provided by them on its face value and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e form of Bank Details or any documents recovered from the business premises of the Appellant by which it can be concluded that Appellant have collected the Service tax. In the present matter department clearly failed to prove the case that Appellant have collected the service tax from their customers. The show cause notice alleged that Appellant have provided business auxiliary services, whereas appellant have provided the GTA services as discussed above. Even if it is assumed that appellant have provided the business auxiliary service the impugned show cause notice has not specified under which clause of the definition of Business Auxiliary Service the activity of the Appellant falls. For determining the taxability of services, it very important to specify the activity of the assessee. In the absence of the specification of the exact sub-heading under which the service falls, taxability of service cannot be decided. CENVAT Credit - HELD THAT:- The charges against the Appellant are that they have not produced the input service documents on which they have taken cenvat Credit. It is contrary to this fact, the appellant has recorded the receipt of the input services in their ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 27.03.2018confirmed the demand of service tax and disallowed the Cenvat Credit. Being aggrieved, the appellant filed an appeal before the Commissioner (Appeals) who by impugned order-in- appeal dated 01-11-2018 upheld the order passed by the Additional Commissioner and dismissed the appeal. Aggrieved by the impugned order-in- appeal present Appeals has been filed. 3. Shri Jigar Shah, Learned Counsel along with Shri Ambarish Pandey, Advocate appearing on behalf of the appellant submits that the impugned proceedings are without Jurisdiction, unconstitutional and erroneous, as the department completely failed to comply with the constitutional scheme so applicable after the enactment of the Central Goods and Service tax, 2017. In the present case, the legislature has omitted the provisions of Chapter V of the Finance Act, 1994. Thus, Section 6 of the General Clauses Act, 1897 shall not be applicable in view of the Judgment of Hon ble Supreme Court in case of Rayala Corporation Vs. Directorate of Enforcement, 1969 (2) SCC 412, supra. Therefore, no proceedings can be initiated, and no liability can be fastened by the Government in respect of any alleged violation or noncompliance of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed without jurisdiction and hence liable to be quashed and set aside. He placed reliance on the following decisions : Checkmate Industries Services Vs. CCE, Pune -III, 2016 (44) S.T.R. 290 (Tri. -Mumbai) M/s Fusion India Inc V. CCE ST., Lucknow- 2018 (11) TMI 358 -CESTAT Allahabad. 3.4 He also submits that the show cause notice proposes to recover service tax amounting to Rs. 1,16,59,641/- under Section 73 of the Finance Act, 1994 which is the provision for recovery of Service tax. However, the show cause notice failed to invoke the relevant provision for chagrining of service tax on alleged activities. In the Finance Act, 1994, Section 66B provides for levy of Service tax on services other than those services specified in the negative list. Since the charging provision was not invoked, therefore, no demand is sustainable. He placed reliance on the decision in the case of Frisco Foods Pvt. Ltd. Vs. Commissioner, Customs Central Excise, Dehradun 2022-VIOL-49-CESTAT-Del-ST. 3.5 He argued that the show cause notice baldly alleged that the Appellant have rendered taxable services. However, the show cause notice does not analyse the activities allegedly carried ou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to Rs. 11,34,259/- shown by them in their ST-3 returns. However, due to some difficulty on the part of the Director of the Appellant, they could not file their reply to show cause notice and no evidences such as documents/copy of invoices/cenvat credit register etc. could be placed for the consideration of the Ld. Adjudicating authority. He produced the copies of the invoices and CENVAT register maintained by the Appellant. 3.9 He also submits that the show cause notice relies on the statements of the directors of the Appellant to allege the rendition of services. The statements of the directors of the Appellant were recorded under duress and pressure. The show cause notice alleges rendition of services and collection of service tax without any documentary evidence. It is well established principle of law that demand of service tax cannot be confirmed merely on the basis of statements. The Appellant have produced enough documents to support their claim that they have not provided any taxable services for which they may be held liable for service tax. He placed reliance on the following decisions: Godavari Khore Cane Transport Co. 2013(29)STR 32 Mahesh Sunny Enterprise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cedure as per Section 9D, submission of Debit Notes of GTA, Authenticity of invoices of truck hired of Rajasthan Goods Carriers and Vaibhav Roadways and demand can be made for extended period or not as submitted by appellant. New grounds and documents may only be admitted according to the procedure prescribed under Rule 23 of CESTAT (Procedure) Rules, which has not been complied with. Appellant never filed any reply to SCN before Commissioner nor appeared before him for PH. So, all arguments tendered by the Appellant now have not been first observed by the Adjudicating Authority. The fresh evidences/documents are not allowed in Tribunal. He placed reliance on the decisions: Kneader House Vs. CCE, Delhi -I 2013 (290) ELT 249 (Tri- Delhi) Sterlite Industries (I) Ltd. Vs. CCE Tirunelvelli 2017(357)ELT 161 (Tri-Chennai) 4.1 As regard the availment of Cenvat Credit by the Appellant he submits that ST return of service provider does not commensurate with Appellant s claim and condition of Rule 4(7) of Cenvat Credit Rules not fulfilled. Cenvat invoices of M/s Mehmood Construction Pvt. Ltd. show that appellant has received manpower services but it is not understood what is th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Court (Three Member Bench), in the case of National Thermal Power Co. Ltd. v. Commissioner of Income Tax, reported in 1998 (99) E.L.T. 200 (S.C.), which is to the effect that the Tribunal has jurisdiction to examine the question of law which arises on facts, as found by the authorities below, and having bearing on tax liability of assessee, even though said question was neither raised before the lower authorities nor in appeal memorandum before the Tribunal, but sought to be added later as an additional ground by a separate letter. 5.1 In the matter Devangere Cotton Mills Ltd. v. Commissioner - 2006 (198) E.L.T. 482 (S.C.) the question arose whether the third member of the Customs, Excise and Gold (Control) Appellate Tribunal to whom the case was referred on difference of opinion between the Bench of two members could permit an additional ground to be raised under Rule 10 of the Customs, Excise and Gold (Control) Appellate Tribunal (Procedure) Rules, 1982. The Supreme Court held that the Tribunal has got wide power to hear and consider a new ground and decide the appeal. The relevant observations are as follows : Rule 10 of the 1982 Rules allows the parties to urge ground ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly, impugned orders of both the authorities are hereby quashed and set aside. Parties are requested to be relegated to the Commissioner (Appeals) for consideration of these issues afresh. Accordingly, the Commissioner (Appeals) is directed to examine all the grounds raised before it by both the sides in accordance with law and both the parties are directed to cooperate in proceeding with the matter with requisite promptness. Appeal is, accordingly, allowed. Rule is confirmed. No order as to costs. In view of the above precedent law, we are of the considered opinion that the Law/Rules has not precluded CESTAT from considering new grounds/ evidence. We do not find merit in the pleas of the Ld. Departmental representative in this regard. 5.2 We find that in the present matter it is on record that during the search at the premises of the Appellants, no invoices/ debit notes etc., raised to their customers were found. In the present matter, transactions records were called from the various customers of Appellant. The said alleged debit notes/ invoices were provided by the customers to department. Further it is on record that during the search at the premises of M/s Forward Resou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on which is completely absent in the present case. 5.3 Further, the Section 83 of the Act states that sections of the Central Excise Act 1944, as stipulated and in force from time to time shall apply so far as may be in relation to ServiceTax as they apply in relation to duty of excise. Section83 of the Finance Act reads as under : - 83. Application of certain provisions of Act 1 of 1944 . - The provisions of the following sections of the Central Excise Act, 1944, as in force from time to time, shall apply, so far as may be, in relation to Service Tax as they apply in relation to a duty of excise :- sub-section (2A) of section 5A, sub-section (2) of Sections 9A, 9AA, 9B, 9C, 9D, 9E, 11B, 11BB, 11C, 12, 12A, 12B, 12C, 12D, 12E, 14, 15, 15A, 15B, 31, 32, 32A to 32P (both inclusive), 33A, 34A, 35EE, 35F, 35FF, to 35-O (both inclusive), 35Q, 35R, 36, 36A, 36B, 37A, 37B, 37C, 37D, 38A and 40. 5.4 In view of the above section 83 of the Finance Act, 1994 a relevant section 9D is applicable in the case of service tax matters also. The department for confirmation of service tax demand relied on the statement of the Director of the Appellant, We observed that, it is settle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he interests of justice. In the present matter the Adjudicating Authority had failed to follow the requirement of Section9D of the Act regarding examination in chief of witness, therefore demand of service tax on the basis of statements of persons cannot be sustainable. 5.5 We also find that in present mattes revenue demanded the service tax under the ―Business Auxiliary Service‖ alleged to have been provided to M/s Chemieorganic Chemicals Pvt. Ltd., M/s Farmson Pharmaceutiacal Gujarat Pvt. Ltd., M/s Lupin Ltd., M/s Anuh Pharma Ltd., M/s Mehta API Pvt. Ltd. and M/s Supreet Chemicals Pvt. Ltd. However, Director of Appellant s company filed affidavit along with supporting documents that the nature of services provided to above customers were in nature of goods transport agency services. When the Service tax is demanded on alleged services, it is the responsibility of the department to show that the appellant had rendered these services to customers with positive evidences. In the present case department failed to do so. The Appellant produced the copies of Debit Notes/ Consignment notes and copies of invoices raised by the transporters to the appellant along with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tatement. Income tax and service tax are two different/ separate and independent special Act and their provisions operate in two different fields. Therefore by relying the 26AS /TDS Statement under the Service Tax Act, demand of service tax cannot be made. We also find the support from the decision of M/s Ved Security Vs. CCE, Rachi -III 2019(6) TMI 383 CESTAT, Kolkata wherein it was held that the value of taxable services cannot be arrived at merely on the basis of the TDS statements filed by the clients inasmuch as even if the payments are not made by the client, the expenditure are booked based on which the form 26AS is filed, which cannot be considered as value of taxable services for the purpose of demand of Service tax. 5.8 In the matter of Synergy Audio Visual Workshop Pvt. Ltd. Vs. Commr. of S.T. Bangalore 2008 (10) S.T.R. 578 (Tri. - Bang.), the Tribunal observed as under : The other ground is for confirming demands is that the appellants had shown certain amounts due from the parties in their Income Tax returns and Revenue has proceeded to demand Service Tax on this amount shown in the Balance Sheet. The appellants have relied on large number of judgments which has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ). The appeal did not advert to any assertion as to how the Service Tax demand can be made when there is no evidence to any taxable service having been rendered in the Jurisdiction of Rajasthan. No inquiries have been conducted by the Revenue to support their case. As such, we find that present appeal is without merit and accordingly, the same is dismissed. In the matter of Calvin Wooding Consulting Ltd. Vs. Commissioner of C.Ex. Indore 2007 (7) S.T.R. 411 (Tri. - Del.) also Tribunal observed as under : 21 . The liability of the recipient cannot arise merely from the fact that, the income-tax was deducted at source, which was the requirement of the Income-tax Act, on the recipient who made payment to the foreign supplier. Such a statutory requirement, as exists under the Income-tax law on the person making the payment to deduct tax at source, as a tax collecting agency of the Revenue, does not exist under the provisions of the ServiceTax law, and no obligation was cast upon the recipient of the service to make any deduction from the amounts payable by way of consideration, under the statutory provisions. Authorization to pay Servicetax under a contractual arrangement whic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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