Case Details: SRK Innovatives School of Information Pvt. Ltd. Versus Pr. Commissioner of Central Tax, GST, Visakhapatnam (2025) 32 Centax 52 (Tri.-Hyd)
Judiciary and Counsel Details
- A.K. Jyotishi, Member (T) & Angad Prasad, Member (J)
- Shri M. Srinivasa Rao, CA, for the Appellant.
- Shri V. Srikanth Rao, Authorised Representative, for the Respondent.
Facts of the Case
The appellant, before the CESTAT was issued a demand by the jurisdictional authorities solely on the basis of differences between income reflected in Form 26AS and Income Tax Returns, as compared to figures declared in the appellant’s ST-3 service tax returns. The authorities did not conduct any independent inquiry into the nature of services rendered or verify their taxability. The appellant submitted that a demand based exclusively on such differences, without classification of services or corroborative evidence, was unsustainable in law, and relied upon judicial precedents to support this position. It was further submitted that such an approach failed to meet the statutory requirements under the Finance Act, 1994. The matter was accordingly placed before Hyderabad CESTAT.
CESTAT Held
The Hyderabad CESTAT held that the Department failed to examine the nature of activities, classify them under Section 66B of the Finance Act, 1994, or determine the value of taxable services in accordance with Section 67 and the Service Tax (Determination of Value) Rules, 2006. It was observed that, in the absence of corroborative evidence, a demand based merely on discrepancies between Form 26AS, Income Tax Returns, and ST-3 returns was legally untenable. The demand was therefore set aside.
List of Cases Cited
- Commissioner v. Dilip Kumar and Company — 2018 (361) E.L.T. 577 (S.C.) — Referred [Paras 3, 19, 20]
- Gopi Chenna v. Commissioner — Final Order Nos. A/30078-30079/2024, dated 26-2-2024 by CESTAT, Hyde — Distinguished [Para 4]
- Government of Kerala v. Mother Superior Adoration Convent — 2021 (376) E.L.T. 242 (S.C.) — Relied on [Para 20]
- Piyush Sharma v. Commissioner — Final Order No. 77332/2023, dated 17-10-2023 by CESTAT, Kolkata — Distinguished [Para 4]
- Vikas Singh v. Commissioner — Final Order No. 55776/2024, dated 17-5-2024 by CESTAT, New Delhi — Distinguished [Para 4]
- Z.R. Enterprises v. State of Gujarat — C/SCA No. 21738 of 2023, decided on 4-4-2024 by Gujarat High Court — Distinguished [Para 4]
List of Notifications Cited
- Notification No. 25/2012-S.T., dated 20-6-2012 [Paras 5, 8, 9, 11, 12, 18, 19]
