Custom, Excise & Service Tax Tribunal
Quantum Pacific Projects Pvt Ltd vs Chandigarh-I on 25 November, 2024
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
CHANDIGARH
REGIONAL BENCH - COURT NO. I (SM)
Service Tax Appeal No. 60162 of 2023
[Arising out of Order-in-Appeal No. CHD-EXCUS-001-APP-156-2022-23 dated
13.12.2022 passed by the Commissioner (Appeals), CGST, Chandigarh]
Quantum Pacific Projects Pvt Ltd ......Appellant
House No. 424, Sector 10,
Panchkula, Haryana 134109
VERSUS
Commissioner of Central Excise and ......Respondent
Central Goods & Service Tax, Chandigarh Plot No. 19, C R Building, Sector 17C, Chandigarh 160017 APPEARANCE:
Shri Vikas Bansal, C.A. for the Appellant Shri Raman Mittal, Authorized Representative for the Respondent CORAM: HON'BLE MR. S. S. GARG, MEMBER (JUDICIAL) FINAL ORDER NO. 60617/2024 DATE OF HEARING: 25.11.2024 DATE OF DECISION: 25.11.2024 The present appeal is directed against the impugned order dated 13.12.2022 passed by the Commissioner (Appeals), CGST, Chandigarh whereby the learned Commissioner (Appeals) has allowed the appeal of the Department and set aside the order passed by the Original Authority.
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2. Briefly stated facts of the present case are that the appellant is registered with Service Tax Department and is engaged in providing taxable services falling under Section 65B of the Finance Act, 1994. The present proceedings were initiated against the appellant by issue of a show cause notice dated 21.12.2020 on the basis of third party data obtained from Income Tax Department for recovery of service tax amounting to Rs.6,38,355/- under Section 73 of the Act along with interest under Section 75 of the Act and on non-paid differential amount and penalties under Sections 77 and 78 were also proposed. It is alleged in the show cause notice that no service tax returns was filed by the appellant for the financial year 2015-16, whereas they have received income on account of providing services as per their financial records and thereby the appellant has not paid the service tax. The appellant filed reply to the show cause notice and after following due process, the Original Authority vide Order-in-Original set aside the demand of service tax amounting to Rs.6,38,355/- as proposed in the show cause notice along with interest and penalties by holding that the appellant has income from 'sale of goods' which was not covered under the definition of service as provided under Section 65B(44) of the Act and no service tax was leviable upon the 'sale of goods' under Section 66B of the Act. The Original Authority categorically held that the appellant was involved in the sale of goods, hence, was not liable to pay service tax under Section 73(1) of the Act and consequently, penalties were also dropped. Aggrieved by the said order, the Department filed the appeal before the Commissioner 3 ST/60162/2023 (Appeals), who accepted the appeal of the Department and set aside the order of the Original Authority. Hence, the present appeal.
3. Heard both the parties and perused the material on record. 4.1 The learned Consultant, Shri Vikas Bansal, appearing on behalf of the appellant submits that the impugned order is not sustainable in law as the same has been passed without properly appreciating the facts and law.
4.2 He further submits that the total revenue of Rs.99,59,323/- as reported in the Profit and Loss Account pertains to the sale of goods. The company was dealing in sale of goods such as building material, furniture etc to various clients and the same is sale of goods per-se not leviable to service tax.
4.3 He further submits that the appellant has furnished the copy of Balance Sheet, Income Tax Returns, VAT Returns and sample invoice along with other various documents before the Original Authority and has also raised the issue of limitation being beyond the prescribed period of limitation.
4.4 He further submits that the Original Authority in the Order-in- Original has considered all the documents and has given the findings that the appellant besides providing the services is also engaged in sale of goods, but the learned Commissioner (Appeals) in para 6.5 of the impugned order has wrongly observed that the appellant has failed to submit Balance Sheet, Sale Bills, Purchase Bills, Form 26- 4 ST/60162/2023 AS, Copy of purchase order, VAT returns etc to substantial their claim.
4.5 He further submits that entire claim of the Department is barred by limitation as the appellant has not suppressed any material facts from the Department and the Department has not been able to establish any suppression on the part of the appellant. 4.6 He also submits that the Original Authority has decided the case in favour of the appellant on the basis of the documents submitted by the appellant.
4.7 In support of his submission, he relies on the decision of Division Bench of this Tribunal in the case of M/s Girdhari Lal Construction Private Limited vs. Commissioner of CE & ST, Ludhiana - Final Order No. 60507-60508/2024 dated 04.09.2024 in Appeal Nos. ST/61348/2019 & ST/60004/2020.
5. On the other hand, the learned AR for the Revenue reiterates the findings of the impugned order and submits that extended period of limitation has rightly been invoked because the appellant did not supply the requisite data asked for by the Department. In support of his submission, he relies on the decision of Single Member Bench of New Delhi Bench of the Tribunal in the case of Ashish Kumar Joshi vs. Commr. of CGST, Raipur - Final Order No. 55777/2024 dated 17.05.2024 in Appeal No. ST/54763/2023-SM.
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6. I have considered the submissions made by both the parties and perused the material on record. I find that in this case, the show cause notice was issued on 21.12.2020 by invoking the extended period of limitation alleging suppression and the period of dispute is 2015-16.
7. Further, I find that the Original Authority after considering all the documents provided by the appellant has come to the conclusion that there is no service involved and it pertains to sale of goods. Further, I find that the learned Commissioner (Appeals) in the impugned order has observed that the appellant has failed to provide various documents, which is factually incorrect.
8. The learned Consultant appearing for the appellant has also brought to my notice that the appellant has explained the discrepancy regarding the invoice dated 18.04.2015 but the learned Commissioner has wrongly interpreted the said invoice in order to confirm the demand.
9. Further, I find that the Division Bench of this Tribunal in the case of M/s Girdhari Lal Construction Private Limited (supra) has considered the issue of invoking the extended period of limitation and has held that when the show cause notice is issued on the basis of third party data, in that case, extended period of limitation cannot be invoked. It is pertinent to reproduce the said findings in para 8 of decision of the Tribunal, which is reproduced herein below:
6 ST/60162/2023 "8. Heard both sides and perused the records of the case.
The Show Cause Notice is apparently based on the findings of CERA audit on the accounts of the appellants; for the reason that the appellant has not submitted any documents; the demand has been raised on the basis of 26AS record. We find that during the impugned period, divergent opinion was being taken by the Tribunal and the Courts; no positive act of commission/omission on the part of the appellants is evidenced to allege suppression of fact, mis-declaration with intent to evade payment of duty so as to invoke extended period. Therefore, we are of the considered opinion that the Revenue has not made out even a weak case for invocation of extended period. We find that the Show Cause Notice issued invoking extended period is not maintainable and therefore, the impugned order passed in pursuant of the same requires to be set aside. We further find that certain portion of the demand is beyond the extended period also. As far as Revenue's appeal is concerned, as the very Show- Cause Notice which is the foundation of the case is liable to be set aside, any appeal filed by Revenue against the dropping of a portion of the demand will also not succeed. As we hold that the appeal filed by M/s Girdhari Lal Construction Pvt. Ltd. squarely succeeds on limitation, we are not inclined to go into the merits of the case."
10. In view of the above facts, I am of the considered view that the entire demand is barred by limitation; accordingly, I hold that the appellant's appeal succeeds on limitation without going into the merits of the case, therefore, I allow the appeal of the appellant on limitation alone by setting aside the impugned order.
(Operative part of the order pronounced in the open court) (S. S. GARG) MEMBER (JUDICIAL) RA_Saifi