Mere non-payment of tax or non-discharge of liability does not suffice the ingredients for invoking extended period

Last updated: 29 December 2022

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The CESTAT, Mumbai has ruled that simply not paying tax or discharging a liability is insufficient grounds for invoking an extended period of tax recovery. The 'proper officer' must provide concrete reasons and evidence to demonstrate that elements like fraud, collusion, wilful misstatement, or suppression of facts exist. This decision reinforces that the onus is on the revenue department to prove these specific conditions, rather than relying solely on the fact of non-payment.

Court :
CESTAT, Mumbai

Brief :
The CESTAT, Mumbai in Principal Commissioner, Service Tax v. M/s. National Institute of Bank Management [Service Tax Appeal No. 85892 of 2016 dated December 22, 2022] has held that mere non-payment of tax or non-discharge of liability does not suffice to alienate the responsibility of the ‘proper officer’ to offer convincing reasons for the belief that the ingredients for invoking extended period are evident.

Citation :
Service Tax Appeal No. 85892 of 2016 dated December 22, 2022

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Judgement posted by

Bimal Jain

Service

FCA, FCS LLB with21 Yrs of Experience inTaxation Indirect and Direct: Education Qualification: B.Com (Hons) Chartered Accountants Company Secretary LLB Qualified SAP FI/CO Consultants Professional Membership: Chairmanof Indirect Tax Committee of PHD Chamber of Commerce Member of Indirec ... Read more

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