Custom, Excise & Service Tax Tribunal
Bhaskar Industries Private Limited vs Bhopal on 21 August, 2025
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
NEW DELHI
PRINCIPAL BENCH - COURT NO. - IV
Service Tax Appeal No. 51763 of 2017
[Arising out of Order-in-Appeal No. BHO-EXCUS-001-APP-70-17-18 dated
21.07.2017 passed by the Commissioner of CGST, Central Excise & Customs,
Bhopal]
M/s. Bhaskar Industries Private Limited ...Appellant
Plot No. 15-16, Sector-D,
Industrial Area, Mandideep,
Dist. Raisen, M.P. - 462046
VERSUS
Commissioner of Service Tax - Bhopal ...Respondent
35-C, GST Bhawan, Administrative Area, Arera Hills, Jail Road, Bhopal, Madhya Pradesh - 462015 APPEARANCE:
Shri B.L. Narasimhan and Ms. Shagun Arora, Advocates for the Appellant Shri S.K. Meena and Shri Manoj Kumar, Authorized Representatives for the Respondent CORAM:
HON'BLE DR. RACHNA GUPTA, MEMBER (JUDICIAL) HON'BLE MRS. HEMAMBIKA R. PRIYA, MEMBER (TECHNICAL) DATE OF HEARING: 22.04.2025 DATE OF DECISION: 21.08.2025 FINAL ORDER NO. 51204/2025 DR. RACHNA GUPTA Present appeal is filed to assail the Order-in-Appeal No. 001- 70-17-18 dated 31.07.2017. The facts in bring which culminated into the said order are as follows:
1.1 M/s. Bhaskar Industries (P) Ltd., the appellants herein, are engaged in manufacture of yarn, Denim fabric. Appellants are also registered with service tax department for receiving Goods Transport Agency Services, Rent-a-Cab Services and Works Contract Services for which the service tax liability is under 2 Service Tax Appeal No. 51763 of 2017 Reverse Charge Mechanism (RCM) in terms of Notification No. 30/2012-ST dated 20.06.2012.
1.2 During the course of their audit, it was observed that the appellant had paid export commission to foreign based commission agents for their export sale for the Financial Year 2010-11 to 2014-15. Department alleged that appellants have actually received Business Auxiliary Services (taxable service) from a foreign service provider but have failed to pay the service tax under RCM.
1.3 With these observations and denying the benefit of notifications claimed by the appellant i.e. Notification No. 14/2004-
ST dated 10.09.2004, Notification No. 18/2009-ST dated 07.07.2009 and Notification No. 42/2012 dated 29.06.2012, the department alleged that the appellants are liable to pay service tax on the value of commission amounting to Rs.15,06,19,987/- paid for the Year 2010-11 to 2014-15. Accordingly, Show Cause Notice Bearing No. 09/2016 dated 22.03.2016 proposing the recovery of service tax on the aforesaid amount, of Rs.1,78,33,526/- along with proportionate interest has been issued. Appropriate penalties under Section 76, 77 and 78 of the Finance Act, 1994 for alleged suppression of facts and contravention of various provisions of the said act were also proposed to be imposed upon the appellant. The said proposal has been confirmed vide Order-in-Original No. 02/2017 dated 09.01.2017. The appeal against the said order has been rejected vide the impugned Order-in-Appeal dated 31.07.2017. Being aggrieved, the appellant is before this Tribunal. 3
Service Tax Appeal No. 51763 of 2017
2. We have heard Shri B.L. Narasimhan and Ms. Shagun Arora, learned Advocates for the appellant and Shri S.K. Meena and Shri Manoj Kumar, learned Authorized Representatives for the department.
3. Learned counsel for the appellant has submitted that in order to procure orders with respect to the textile products manufactured by the appellant, the appellant had engaged commission agents both in India as well as outside India by virtue of independent agreements executed with the said agents. Service tax on the value of commission given to its agents located in India has duly been paid by the appellant. However for the foreign commission agents, the service tax has not been paid under the bona fide belief that such services received from commission agents were exempted from the payment of service tax.
3.1 It is submitted that while replying to the impugned show cause notice, the appellant has mentioned that the Business Auxiliary Services were exempted from the payment of service tax vide three notifications (as already mentioned above). However, the show cause notice proposed to deny the benefit under Notification No. 42/2012-ST dated 29.06.2012 on the ground that the documentary requirements under the said notification were not complied with. It is submitted that incorrect interpretation has been adopted by the department. The amount of commission does not have to be limited to 1% of the FOB value of goods as has been observed by the adjudicating authorities below. The findings that appellant has paid commission in excess of 1% of FOB value to its foreign commission agents is otherwise beyond the show 4 Service Tax Appeal No. 51763 of 2017 cause notice, hence the order under challenge is liable to be set aside on this score itself.
3.2 Learned counsel further submitted that as per the condition to the notification, the exemption threshold is service tax on 10% of the FOB value of goods. The appellant, as per calculation based on the conditions of the said notification, was entitled to exemption of service tax up to Rs.1,42,930/-. However, the exemption actually availed by the appellant is only for Rs.42,879/- which is much below the exemption threshold provided by the said notification. Hence, the findings denying the benefit of Notification No. 42/2012-ST are liable to be set aside.
3.3 With respect to exemption benefit under Notification No. 14/2004 dated 10.09.2004, it is submitted that the notification exempts the specific category of Business Auxiliary Services when provided by a commercial concern to its clients if the services are provided in relation to agriculture, printing, textile processing or education. The services being received by the appellant from the foreign commission agents is admittedly Business Auxiliary Service and appellant admittedly is engaged in textile processing. Hence the benefit of exemption of the said Notification No. 14/2004 has wrongly been denied. Learned counsel has relied upon the following decisions.
(i) Texyard International Vs. Commissioner of Central Excise, Trichy, 2015 (40) S.T.R. 322 (Tri.-Chennai)
(ii) Jansons Industries Limited Vs. Commissioner of Central Excise, Salem, 2023 (10) TMI 433 - CESTAT Chennai 5 Service Tax Appeal No. 51763 of 2017
(iii) Madras Security Printers Private Limited Vs. Commissioner of Service Tax, Chennai, 2023 (4) TMI 1195-
CESTAT Chennai
(iv) Aviram Knitters Vs. Commissioner of GST & Central Excise Coimbatore, 2019 (2) TMI 92 - CESTAT Chennai
(v) Maxican Exports Vs. Commissioner of Central Excise & Service Tax, Ticurhirapalli, 2018 (8) TMI 819 - CESTAT Chennai
(vi) Shri Ramalinga Mills Ltd. Vs. CCE, Madurai, 2018 (9) TMI 1667 - CESTAT Chennai
(vii) K.P.R. Cotton Mills Pvt. Ltd. Vs. Commissioner of Central Excise, Coimbatore, 2017 (10) TMI 344 - CESTAT Chennai
(viii) CCE (A) Trichy Vs. Arvind A Traders, Anartex Exports & Others, 2015 (11) TMI 1176 - CESTAT Chennai 3.4 Learned counsel further submitted that the deficiency notices by the department about EXP-3 and EXP-4 are purely procedural in nature. Such deficiencies have wrongly made basis to deny the substantial benefit of exemption to the appellant. Learned counsel has relied upon the following decisions:
(i) Orient Refractories Limited Vs. Commissioner of Central Goods & Service Tax Commissionerate, Jaipur (Rajasthan), 2024 (7) TMI 1359 - CESTAT New Delhi 6 Service Tax Appeal No. 51763 of 2017
(ii) HEG Ltd. Vs. Commissioner (Appeals) GST, Customs and Central Excise Bhopal, 2023 (5) TMI 722 - CESTAT New Delhi
(iii) HEG Limited Vs. Commissioner of Customs, C. Ex. & ST., Bhopal, 2019 (29) G.S.T.L. 730 (Tri.-Del.)
(iv) Metro & Metro Vs. Commissioner, 2018 (12) TMI 257 (Tri.-All.)
(v) Radiant Textiles Ltd. Vs. CCE, 2017 (47) STR 195 (CESTAT-Chennai)
(vi) Coromandel Stampings & Stones Ltd. Vs. CCE - 2016 (43) STR 221 (Tri-Hyd) 3.5 It is further submitted that the services received by the appellant from foreign commission agents are in the nature of intermediary services which has also been accepted by the original adjudicating authority at Para 27.23 of the Order-in-Original. The definition of intermediary in Rule 2(f) of place of provision Rules, 2012 underwent a change to include such agents who arrange or facilitate supply of goods. It is Rule 9 of place of provision Rules which is applicable to the intermediary services. According to which place of provision for such services is the location of the service provider. In the present case the said location is the foreign location i.e. outside the taxable territory. Based on this ground also there is no tax liability on the appellant. Above all, service tax, if any, payable by the appellant was available as credit, hence the demand is liable to be set aside on situation being Revenue neutral. Reliance is placed on the following decisions: 7
Service Tax Appeal No. 51763 of 2017
(i) Commissioner of Central Excise Vs. Angadpal Indl. P. Ltd. reported as 2015 (325) ELT 228 (SC)
(ii) Saroval Hotels Pvt Ltd. Vs. CST, Mumbai 2018 (10) GSTL 72 (Tri.-Mumbai)
(iii) CST, Mumbai-II Vs. Reliance Communication Ltd. 2019 (22) GSTL 203 (Tri.-Mumbai)
(iv) Jet Airways (I) Ltd. Vs. Commissioner of Service Tax, Mumbai 2016 (8) TMI 989 - CESTAT Mumbai 3.6 Finally it is submitted that no mala fide can be attributed in revenue neutral situation when services received from outside India and service tax payable on reverse charge basis is available as credit. Due to the same reason, the order imposing penalty is also not sustainable. The show cause notice should not have invoked the extended period of limitation. With these submissions, the order under challenge is prayed to be set aside and appeal is prayed to be allowed.
4. While rebutting these submissions learned Departmental Representative appearing for the department, at the outset has reiterated the findings of the orders passed by departmental adjudicating authorities. It is submitted that benefit of three of the notifications (Notification No. 14/2004-ST, 18/2009-ST, 42/2012-
ST) is rightly been denied to the appellant.
4.1 With respect to the Notification No. 14/2004-ST, it is mentioned that the services of commission agent relating to sale or marketing is not covered by the said notification. Learned 8 Service Tax Appeal No. 51763 of 2017 Departmental Representative further submitted that the benefit of Notification No. 18/2009-ST and 42-2012-ST is available subject to various conditions prescribed therein. One of the requirement of these notifications is filing of return in EXP-4 along with all supporting documents. The appellant has failed to comply with those conditions. The notifications also limit the commission to 1% of FOB value of export goods for which the said services have been used. However, the appellant has paid commission ranging from 1% to 4%. Resultantly, the exemption out of both this notification has also been rightly denied.
4.2 Finally, it is submitted that the appellant never disclosed the facts to the department which got unearthed only at the time of audit. Under the self-assessment system, the assessee are bound by the law, to correctly assess their service tax liability and to thereafter file an proper ST-3 returns. Absence of compliance of those provisions or improper compliance thereof is the sufficient evidence proving willful suppression of facts from the department. The sole motive of such suppression is an intent to evade the payment of service tax. Hence the extended period has rightly been invoked by the department while issuing the impugned show cause notice. The penalties have also been rightly imposed by the departmental adjudicating authorities. With these submissions, learned Departmental Representative has prayed for dismissal of the present appeal.
5. Having heard both the parties and perusing the entire records, we observe and hold as follows:
9
Service Tax Appeal No. 51763 of 2017 5.1 There is no dispute about the fact that the appellant has received Business Auxiliary Services from foreign commission agents for promoting sale of the textile goods manufactured by the appellant. There is also no dispute to the fact that the said service is a taxable service. Thus, the narrow compass of present adjudication is:
"Whether appellant is liable to pay service tax under Reverse Charge Mechanism for receiving Business Auxiliary Services from the commission agents based in non-taxable territories (foreign countries)?"
5.2 While denying the appellants liability under Reverse Charge Mechanism, the appellant has claimed exemption arising out of three separate notifications. Hence to adjudicate the aforesaid question, we foremost need to peruse the respective notifications. Notification No. 14/2004-ST dated 10.09.2004 reads as follows:
In exercise of the powers conferred by sub-section (1) of Section 93 of the Finance Act, 1994 (32 of 1994), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts taxable service provided to a client by any other person in relation to the business auxiliary service, insofar as it relates to,-
(a) xxxxxxxxxxxx
(b) xxxxxxxxxxxx
(c) xxxxxxxxxxxx
(d) a service incidental or auxiliary to any activity specified in
(a) to (c) above, and provided in relation to agriculture, printing, textile processing or education from the whole of service tax leviable thereon under section 66 of the said Finance Act:
5.3 The bare perusal of this notification makes it clear that the exemption is made available to the person providing Business 10 Service Tax Appeal No. 51763 of 2017 Auxiliary Service when provided in relation to agriculture, printing, textile processing or education. As already observed above, it is an admitted fact that appellant is the service recipient of Business Auxiliary Service. Just because the service provider is located in non-taxable territory and appellant may invite liability under Reverse Charge Mechanism in terms of Notification No. 30/2012 dated 30.06.2012, the appellant being the service recipient is not entitled to get the benefit of exemption which is otherwise available to the service provider. Hence we hold that the benefit of Notification No. 14/2004 is not available to the appellant. 5.4 Notification NO. 18/2009 dated 07.07.2009 reads as follows:
In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994) (hereinafter referred to as the said Act), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby exempts the taxable service received by an exporter of goods (hereinafter referred to as the exporter) and used for export of goods (hereinafter referred to as the said goods), of the description specified in column (3) of the Table below (hereinafter referred to as the specified service), pertaining to sub-clauses of clause (105) of section 65 of the said Act specified in the corresponding entry in column(2) of the said Table, from the whole of the service tax leviable thereon under section 66 and section 66A of the said Act, subject to the conditions specified in column (4) of the said Table, namely:-
Serial Sub-clause Description of the taxable Conditions service No. (1) (2) (3) (4) 11 Service Tax Appeal No. 51763 of 2017
1. (zzp) Service provided to an exporter The exporter shall have for transport of the said goods by to produce the road from any container freight consignment note, by station or inland container depot whatever name called, to the port or airport, as the case issued in his name.
may be, from where the goods are exported; or Service provided to an exporter in relation to transport of said goods by road directly from their place of removal, to an inland container depot, a container freight station, a port or airport, as the case may be, from where the goods are exported.
2. (zzb) Service provided by a (1)The exporter shall commission agent located declare the amount of outside India and engaged under commission paid or a contract or agreement or Payable to the any other commission agent document by the exporter in in the shipping bill or bill India, to act on behalf of the of export, as the case exporter, to cause sale of goods may be.
exported by him. (2) The exemption shall
be limited to one per
cent of the free on
board value of export
goods for which the
said service has been
used.
(3) The exemption
shall not be available on
the export of canalised
item, project export, or
export financed under
lines of credit extended
by Government of India
or EXIM Bank, or export
made by Indian partner
in a company with
equity participation in an
overseas joint venture
or wholly owned
subsidiary.
(4) The exporter
shall submit with the
half yearly return after
certification of the same
as specified in clause (g)
of the proviso-
(i) the original
documents showing
actual payment of
commission to the
commission agent; and
(ii) a copy of the
agreement or contract
entered into between
the commission agent
located outside India
and the exporter in
relation to sale of export
goods, outside
India:
Provided that-
(a) the exemption shall be available to an exporter who,-
(i) informs the Assistant Commissioner of Central Excise or the Deputy Commissioner of Central Excise, as the case may be, having jurisdiction 12 Service Tax Appeal No. 51763 of 2017 over the factory or the regional office or the head office, as the case may be, in Form EXP1, before availing the said exemption;
(ii) is registered with an export promotion council sponsored by the Ministry of Commerce or the Ministry of Textiles, as the case may be;
(iii) is a holder of Import-Export Code Number;
(iv) is registered under section 69 of the said Act;
(v) is liable to pay service tax under sub-section (2) of section 68 of said Act, read with sub-clause (iv) or sub-clause (v) of clause (d) of sub-rule (1) of rule 2 of the Service Tax Rules,1994, for the specified service;
(b) the invoice, bill or challan, or any other document issued by the service provider to the exporter, on which the exporter intend to avail exemption, shall be issued in the name of the exporter, showing that the exporter is liable to pay the service tax in terms of item (v) of clause (a);
(c) the exporter availing the exemption shall file the return in Form EXP2 every six months of the financial year, within fifteen days of the completion of the said six months;
(d) the exporter shall submit with the half yearly return, after certification, the documents in original specified in clause (b) and the certified copies of the documents specified in column (4) of the said Table;
(e) the documents enclosed with the return shall contain a certification from the exporter or the authorised person, to the effect that taxable service to which the document pertains, has been received and used for export of goods by mentioning the specific shipping bill number on the said document;
(f) where the exporter is a proprietorship concern or partnership firm, the documents enclosed with the return shall be certified by the exporter himself and where the exporter is a limited company, the documents enclosed with the return shall be certified by the person authorised by the Board of Directors;
(g) where the amount of service tax in respect of the service specified against serial No. 2 of the Table exceeds one per cent. of the free on board value of the export then, the amount in excess of the said one per cent shall be paid within the period specified under rule 6 of the Service Tax Rules, 1994;
5.5 The bare perusal reveals that the taxable service provided by a commission agent located outside India and received by an exporter of goods for being used in export of goods though are exempted from service tax but subject to the conditions as mentioned above. One of the such condition is that the exemption 13 Service Tax Appeal No. 51763 of 2017 limit shall be limited to 1% of the free on board value (FOB) of export goods for which the said service has been used. The bare perusal makes it abundantly clear that exemption to the extent of 1% of so stated value only was available to the appellant. There is no denial on part of the appellant that the commission paid was in the range of 1% to 4%. This particular perusal is sufficient to hold that the condition of this notification has not been fully complied with by the appellant. The situation where the amount of service tax exceeds 1% of FOB value of export is well covered under sub clause (g) of the said notification as mentioned above. This notification was applicable up to 30.06.2012. For the subsequent period the notification is:
Notification No. 42/2012 dated 29.06.2012. It reads as follows:
In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994) (hereinafter referred to as the said Act), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts the taxable service received by an exporter of goods (hereinafter referred to as the exporter) and used for export of goods (hereinafter referred to as the said goods), of the description specified in column (2) of the Table below (hereinafter referred to as the specified service), from so much of the service tax leviable thereon under section 66B of the said Act, as is in excess of the service tax calculated on a value up to ten per cent of the free on board value of export goods for which the said specified service has been used, subject to the conditions specified in column (3) of the said Table, namely:-
Sr. Description of the taxable
Conditions
No. service
(1) (2) (3)
1. Service provided by a commission (1) The exporter shall declare the amount of
agent located outside India and commission paid or payable to the commission
engaged under a contract or agent in the shipping bill or bill of export, as the
agreement or any other document case may be.
by the exporter in India, to act on (2) The exemption shall be limited to the service 14 Service Tax Appeal No. 51763 of 2017 behalf of the exporter, to cause tax calculated on a value of ten per cent of the free sale of goods exported by him. on board value of export goods for which the said service has been used.
(3) The exemption shall not be available on the export of canalised item, project export, or export financed under lines of credit extended by the Government of India or EXIM Bank, or export made by Indian partner in a company with equity participation in an overseas joint venture or wholly owned subsidiary.
(4) The exporter shall submit with the half-yearly return after certification of the same as specified in clause (g) of the proviso--
(i) the original documents showing actual payment of commission to the commission agent; and
(ii) a copy of the agreement or contract entered into between the commission agent located outside India and the exporter in relation to sale of export goods outside India:
Provided that-
(a) the exemption shall be available to an exporter who,-
(i) informs the Assistant Commissioner of Central Excise or the Deputy Commissioner of Central Excise, as the case may be, having jurisdiction over the factory or the regional office or the head office, as the case may be, in Form EXP3 appended to this notification, before availing the said exemption;
(ii) is registered with an export promotion council sponsored by the Ministry of Commerce or the Ministry of Textiles, as the case may be;
(iii) is a holder of Import-Export Code Number;
(iv) is registered under section 69 of the said Act;
(v) is liable to pay service tax under sub-section (2) of section 68 of said Act, read with item (G) of sub-clause (i) of clause (d) of sub-rule (1) of rule 2 of the Service Tax Rules,1994, for the specified service;
(b) the invoice, bill or challan, or any other document by whatever name called issued by the service provider to the exporter, on which the exporter intends to avail exemption, shall be issued in the name of the exporter.
(c) the exporter availing the exemption shall file the return in Form EXP4, every six months of the financial year, within fifteen days of the completion of the said six months;15
Service Tax Appeal No. 51763 of 2017
(d) the exporter shall submit with the half yearly return, after certification, the documents in original specified in clause (b) and the certified copies of the documents specified in column (3) of the said Table;
(e) the documents enclosed with the return shall contain a certification from the exporter or the authorised person, to the effect that specified service to which the document pertains, has been received and used for export of goods by mentioning the specific shipping bill number on the said document.
(f) where the exporter is an individual or a proprietorship concern or an HUF or a partnership firm, the documents enclosed with the return shall be certified by the exporter himself and where the exporter is any other person, the documents enclosed with the return shall be certified by the person authorised by the Board of Directors or any other competent person;
(g) where the amount of commission charged in respect of the specified service exceeds ten per cent. of the free on board value of the export then, the service tax shall be paid within the period specified under rule 6 of the Service Tax Rules, 1994, on such amount, which is in excess of the said ten per cent;
2. This notification shall come into force on the 1st day of July, 2012. 5.6 The bare perusal of this notification also clarifies that the exemption to taxable service received by an exporter of goods and used for export of goods from the commission agent located outside India is subject to several conditions as mentioned in the notification. Apparently and admittedly, all the above said conditions have not been complied with by the appellants as the return in form EXP-4 were not filed as required. Hence the appellant was not entitled for the benefit of this notification as well. 16
Service Tax Appeal No. 51763 of 2017 5.7 Coming to the plea of the appellant that no service tax is payable on services provided by the foreign commission agent in relation to supply of goods for the period from 01.10.2014 to 31.03.2015, services being provided outside the taxable territory, they being the intermediary. We have foremost peruse the definition of 'intermediary' in Rue 2(f) of the Place of Provision of Service Rules, 2012 which has underwent a change to include such agent who arrange or facilitate 'supply of goods'. The relevant portion of the provisions pre and post amendment has been extracted below for ready reference:
Definition post 01.10.2014
(f) intermediary means a broker, and agent or any other person, by whatever name called, who arranges or facilitates a provision of a service (hereinafter called the main service) or a supply of goods, between two or more persons, but does not include a person who provides the main service or supplies the goods on his account; The Old Definition was as under:
(f) "intermediary means a broker, an agent or any other person, by whatever name called; who, arranges or facilitates a 32 provision of a service (hereinafter called the 'main' service) between two or more person, but does not include a person who provides the main service on his account;
We also observe that the place of provision of intermediary services is determined under Rule 9 of the POPS Rules, as below:
Rule 9. Place of provision of specified services. - The place of provision of following services shall be the location of the service provider:- (a) Services provided by a banking company, or a financial institution, or a non-banking financial company, to account holders; (b) Online information and database access or retrieval services; (c) Intermediary services; (d) Service consisting of hiring of means of transport, upto a period of one month.' 17 Service Tax Appeal No. 51763 of 2017 Given the above, it is clear that post 01.10.2014, services provided by foreign commission agents would be deemed as to have been provided in the country of the agents itself. Hence, the same cannot be made taxable in the hands of the appellant.
From the above discussion it becomes clear that though the appellant was not entitled to the benefit of the notifications as claimed, however the appellant was still not liable to pay service tax on the amount in question.
5.8 Finally coming to the plea of show cause notice being barred by time, it is held that the appellant did not file the returns based on the bona fide belief of being eligible for exemptions under notifications. The appellant also relied upon the Chartered Accountant Certificate impressing upon no tax liability of the appellant. It is also an apparent admitted fact on the record that appellant was duly discharging its service tax liability on the amount of commission paid to its agent located in India vis-à-vis agents located abroad. The appellant was under belief of no liability.
5.9 The department has not produced any evidence of any positive act on part of the appellant which may amount to suppression that too with an intent to evade the payment of duty.
In these circumstances, it is held that the department was not right while invoking the extended period of limitation. The show cause notice is accordingly held to be barred by time. The demand confirmed based on such show cause notice is liable to be set 18 Service Tax Appeal No. 51763 of 2017 aside. We draw our support from the decision of Hon'ble Supreme Court in the case of Anand Nishikawa Co. Ltd. Vs. Commissioner of Central Excise, Meerut reported as 2005 (188) ELT 149 (SC), wherein it is held that suppression of facts can have only one meaning that the correct information was not disclosed deliberately to evade payment of duty when facts were know to both the parties. The omission by one to do what he might have done not that he must have done would not render it suppression. It is settled that mere failure to declare does not amount to willful suppression. There must be some positive act from the side of the assessee to find willful suppression. We also draw our support from the decision of Hon'ble Supreme Court in the case of Jaiprakash Industries Ltd. Vs. Commissioner of Central Excise, Chandigarh reported as 2002 (146) ELT 481 (SC), wherein it is held that demand based on Income Tax Returns and 26AS and/or balance sheet is not sustainable without proper enquiry and analysis.
6. In totality of entire above discussion, the order under challenge is hereby set aside. Consequent thereto, the appeal stands allowed.
[Order pronounced in the open court on 21.08.2025] (DR. RACHNA GUPTA) MEMBER (JUDICIAL) (HEMAMBIKA R. PRIYA) MEMBER (TECHNICAL) HK