Service Tax - Audit of the Audit

Two Board Circulars, No.887/7/2009-CX, dated 11.5.2009 and No.224/37/2005-Cx.6, dated 24.12.2008 lay down elaborate guidelines about the duty of CE officers to scrutinize the returns. Though these are Central Excise circulars, should they be ignored by CE officers manning service tax departments? As usual, none under the CBEC takes it seriously, either the Board or its circulars. Recently, while arguing a first appeal, I relied on these circulars to point out that there is failure to perform their duty by the jurisdictional CE officers. Hence, assessee cannot be accussed of suppression etc. His response was "Don't talk to me about scrutiny of returns in service tax department. It is a joke". Are the assessees expected to laugh at this miserable "joke" and forget the demands and penalties? CBEC should pull up its socks, take a leaf from its cousin CBDT and try to automate the scrutiny of returns along the lines of CPC set up by CBDT.

Gururaj B N 29/05/2015

 

This has reference to Learned Shri Gururaj posting regarding Periodical show cause notice not issued. For issue of periodical SCNs demands are quantified on the basis of the relevant statistical figures furnished by the assessees for the material period. This is always called for by the Departmental officers from the assessee as the same is not available in the statutory returns filed by them. However, for some reasons assessees do not furnish the said required information inspite of repeated pursuasion of the officers orally as well as written. In such cases does this non compliance on the part of the assessee amount to suppression of facts. Agreed, the issue is known to the Department but non supply of the required statistical figures for quantification of the demand would in my personal view amounts to suppression of facts and relevant provisions can be invoked.

Hari Narayanan 29/05/2015