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TMI Blog2025 (1) TMI 674X X X X Extracts X X X X X X X X Extracts X X X X ..... scrap sale details in balance sheet of Financial Year 2016-17 and Trial Balance April -17 to June-17 that there is a difference in sale value of scrap as reported in balance sheet/trial balance and ER-1 filed by the appellant. The assessable value shown in the balance sheet was higher than the one reflected ER-1 resulting into the difference of Rs.61,47,001/- on which the central excise duty of Rs.7,68,375/- was payable. The said amount along with the proportionate interest was proposed to be recovered from the appellant along with the proposal of imposition of penalty under Section 11AC of Central Excise Act, 1944 vide Show Cause Notice No. 14/18-19 dated 21.08.2019. The said show cause notice also proposed the demand of service tax of Rs.82,313/- not paid on clearance of exempted goods and the service tax amounting to Rs.15,206/- not paid on the difference of scrap sale. Both these amounts were also proposed to be recovered along with interest with the imposition of penalty under same provision. While adjudicating the said show cause notice, the original adjudicating authority has dropped the demand of Rs.82,313/- on clearance of exempted goods under the provision of Rule 6(3) o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Kutchh Steels Pvt. Ltd. Vs. CCE & ST, Rajkot reported as 2023 SCC OnLine CESTAT 653. The allegation of clandestine removal of goods is also based on difference in sales figures in ER-1 and balance sheets. It is submitted that the said difference cannot be the basis. 3.2 Learned counsel further mentioned that the Chartered Accountant Certificate certifying the reconciliation of difference in balance sheet and ER-1 was placed before the adjudicating authorities but the certificate has not been considered. Law is settled that CA certificate is sufficient evidence except proved otherwise. There is no evidence of the department contrary to the CA certificate. Commissioner (Appeals) has committed an error while ignoring the relevant document. Learned counsel also mentioned that the question framed by the adjudicating authority i.e. 'if the sample were free how it led to income generation?' is beyond the scope of show cause notice. The order under challenge is liable to be set aside on this ground itself. Reliance has been placed on the following decisions: (i) CGS Systems International (I) Pvt. Ltd. Vs. Commissioner of Central Tax, Bengaluru reported as 2021 (48) GSTL 375 (Tri.-Bang. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... payment of service tax, there is no infirmity when extended period has been invoked while issuing the show cause notice. With these submissions, learned Departmental Representative has relied upon two other decisions i.e. in the case of Warsi Buildcon Vs. Principal Commissioner of Customs, Central Excise and Service Tax, Indore reported as 2024 (3) TMI 286 CESTAT New Delhi and the decision of Hon'ble Supreme Court in the case of Union of India Vs. Dharmendra Textile Processors reported as 2008 (13) SCC 369. With these submissions, the order under challenge is prayed to be upheld and the appeal is prayed to dismissed. 5. Having heard both the parties, the rival contentions and after perusing the entire record, Iobserve that initially three issues were raised in the show cause notices, however demand with respect to two of the issues stands already dropped, One being settled under SVLDRS, 2019 scheme. The demand which has been confirmed is of Rs.7,68,375/- i.e. differential amount of duty. Due to difference in gross income as per balance sheet/trial balance and value of ER- 1 returns, clandestine removal has also been alleged based on the said difference. The moot controversy to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clandestine removal of goods, has been upheld by Hon'ble Apex Court in the case of Commissioner Vs. R.A. Castings Pvt. Ltd. reported as 2011 (269) ELT A108 (SC). In light of this discussion, I hold that the department has failed to prove the allegations of clandestine removal of goods and noticed difference in the balance sheet compared with the ER-1 return is the presumptory basis of raising the said allegation. The findings in the impugned order to this aspect are therefore liable to be set aside. 7. Issue No. 2 7.1 To adjudicate this issue, I find that find that it is a settled principle of law that service tax can be levied only when there is a clear identification of service provider, service recipient and consideration paid for the same. In the absence of any such evidence of the service recipient and the service provided, service tax cannot be demanded and confirmed. For this reason, I am of the considered opinion that it is not open for the Department to raise demands on the basis of other statutory returns like Income Tax Returns or balance sheets without proving that such service has been rendered by the assessee and consideration thereof has been received. Similarly, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee Polyfil Vs. Commissioner of Central Excise & Service Tax reported as (2024)16 Centax 433 (Tri.-Ahmd) has held that the certificate issued by Chartered Accountant is alone a valid piece of evidence even without corroboration. It can be treated as expert evidence for the reason that Institute of Chartered Accountant of India, a statutory body instituted by the Government of India, has recognized the Chartered Accountant to be competent to issue certificates on financial statements and Auditor General of India has been accepting financial statements of registered companies when endorsed by the Chartered Accountant with their signatures and seals. Section 32(2) of Indian Evidence Act, 1872 also permits acceptance of such document without a formal proof. The recent decisions of the Tribunal, as follows, have also held that the difference between the financial statements of the assessee and the returns cannot be the sole basis of the demand confirmed. 8. Finally coming to the plea of wrong invocation of extended period as alleged by the appellant, I observe that the show cause notice has been issued invoking the provision of sub-section (1) of Section 73 of Finance Act, 1994. It has ..... 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