Proper filing of ST 3 Returns and other Statutory Returns: CESTAT sets aside Service Tax Demand on Extended Period [Read Order]

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT) set aside service tax demand on extended period as there was proper filing of ST 3 returns and other statutory returns.

The appellants are registered as service provider. The sample copy of the ST 3 Returns shows that they have shown the turnover for Nepal transactions under the Heading „Amount billed for exported services without payment of tax‟. From the Invoices, it is seen that they have not charged any Service Tax on the Nepal service recipients. The appellants have, in fact fulfilled the first condition of Export of Services Rules, 2005 by rendering the same fully at Nepal.

All the documentary evidence shows that they have declared all the transactions in their books of accounts, ST 3 Returns and Income Tax Returns. Hence, far from the allegation of suppression with an intent to evade, the appellants have come clean with their proper filing of ST 3 Returns and other statutory Returns.

A Two-Member Bench comprising R. Muralidhar, Member (Judicial) and K. Anpazhakan, Member (Technical) observed that “Hence, we hold that the confirmed demand for the extended period is legally not sustainable. Hence, we set aside the confirmed demand for the extended period. However, they are required to pay the Service Tax, if any for the normal period. Even in the cited case of Cox & Kings relied upon by the appellant, after setting aside the demand in respect of extended period, the demand towards normal period has been confirmed.”

“The appellant has also submitted that a part of the confirmed demand is for the period even beyond the 5 years‟ period. On the ground that there is no power conferred on the Revenue to demand any Service Tax for this period beyond 5 years, the confirmed demand, if any, for the period beyond 5 years, we set aside the same” the Bench concluded.

To Read the full text of the Order CLICK HERE

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