By TIOL News Service

NEW DELHI, OCT 23, 2015: THE facts are that the appellant is registered with department for air travel agent service, tour operators service and business auxiliary service. Initially, a SCN was issued for the period 2004-2005 to 2008-2009 on 8.4.2010; this SCN is not the subject matter of the present proceedings.

Later, the appellant was asked to provide details/documents/information for the period April, 2009 to March 2010 through various letters dated 3.6.2010, 4.7.2010, 28.7.2010, 3.9.2010 and lastly on 1.10.2010. But the appellant did not provide any details to the department.

Therefore, a SCN was issued by invoking the provisions of section 72 of the FA, 1994 mentioning that best judgment assessment is attracted as no returns were furnished by assessee. In the show cause notice, the quantification table of service tax liability has been incorporated on the basis of 25% of enhancement of previous years turnover. Nowhere it is mentioned that whatever information the appellant has supplied are not sufficient and what are the deficiencies in this information.

This SCN was challenged and the Delhi High Court directed the adjudicating authority to decide the matter with regard to jurisdiction.

The adjudicating authority held that SCN is maintainable and the same has been confirmed by the learned Commissioner (Appeals).

The appellant is before the CESTAT.

After considering the submissions, the Bench reproduced the SCN (as scanned copy) in its entirety &after extracting the provisions of s.72 of the FA, 1994, the Bench observed -

+ Section 72 ibid has two limbs:

A. Fails to furnish the return

or

B. If return has been filed, in that case, he fails to assess the tax in accordance with law.

+ In this case, the allegation against the appellant is that they have not filed their ST 3 return under section 70 of the Act. If that is so, then the provision of section 72(a) are attracted. But it is a fact on record that the appellant has filed their return regularly under section 70 of the Act. Therefore, the foundation of the show cause notice that the appellant has not filed their return is incorrect. If the case of the Revenue is that appellant has not filed the return, the provision of section 72 are attracted. The said allegation against the appellant stand disapproved as the appellant has filed their return regularly.

+ There is no allegation against the appellant that they have filed the return and failed to assess the tax in accordance with the provisions of law. Therefore, we hold that provision of section 72(b) are not attracted in the show cause notice and the show cause notice has been issued without appreciating the facts that the appellant have been filing the return regularly.

+ In the paragraph 4 of the show cause notice, it is mentioned that appellant were asked to provide details /documents/ information for issuance of the show cause notice, through various letters. On examination of those letters, we find that in para 2 of the same, it is alleged that the appellant has not filed proper reply inspite of letters issued to them. Hence, he was requested to furnish following information/ details/ documents for the period April, 2009 to March, 2009. But, what are the documents /information and details as required is not been mentioned in these letters. For that, appellant has specifically asked the department to tell what information they require, but despite the appellants request, it was not informed what information /details /documents were required for by the department to issue the show cause notice. In the absence of any document, nature of details which was sought to be asked from the appellant specifically, in that case, the show cause notice is only on the basis of assumption and presumption.

Holding that the show cause notice is deficient and, therefore, the same is not maintainable, the impugned order was set aside and the appeal was allowed with consequential relief.

(See 2015-TIOL-2270-CESTAT-DEL)