Service tax cannot be imposed merely on presumptions; actual liability must be proven, and the extended limitation period for tax recovery requires clear evidence of misconduct or evasion.

JUDGMENT :

SOUMITRA SAIKIA, J.

This writ petition is filed by the petitioner who is the proprietor of the Proprietorship firms namely, M/S N.K Sharma and M/S Sidharth Enterprise. The petitioner is registered under the Service Tax net vide Service Tax Code (Registration No.) AIIPS4609P. The petitioner is engaged in the business of providing transportation service and supply of tangible goods. For the Financial Year 2014-15 (October, 2014 to March, 2015) to Financial Year 2017-18 (upto June, 2017) for services rendered by the petitioner, a summons dated 10.05.2018 was issued by Superintendent, Anti-Evasion, Goods & Services Tax, Dibrugarh Commissionarate under Section 14 of the Central Excise Act 1944 read with Section 80 of the Finance Act, 1994. The petitioner was asked to appear in person or through authorized representatives on 30.05.2018 for recording statements and submission of certain documents such as copies of Form 26AS, balance-sheet with profit and loss for the period 2012-13 to 2016-17, copies of contract agreements, work orders etc. The petitioner initially sought for extension of time to submit the relevant papers and documents sought for and eventually submitted all its documents in support of his case. Thereafter, a show cause notice dated 31.12.2020 was issued by the competent authority which although initially stated to have been not received by the petitioner but upon personal appearance before the competent authority, copies thereof were served by the respondent authorities. It was alleged in the show cause notice that the petitioner had willfully suppressed material facts providing taxable services to service receiver during the period from 2014-15 to 2017-18 with an intent to evade payment of service tax amounting to Rs.1,44,82,015/- in contravention of the provisions of Section 66B and 68 of the Finance Act, 1994 read with Rule 6 of the Service Tax Rules, 1994.

2. It was alleged that on scrutiny of Form 26AS collected from the Income Tax Department, TDS was seen to be deducted by the various service recipients and since the petitioner did not submit any documents regarding the services provided, there is a reason to believe that the income amount on which the petitioner paid income tax collected against the services provided by him, the petitioner had rendered taxable services amounting to Rs. 1,66,86,568/- and as such the service tax on the value of such services provided amounting to Rs. 1,44,82,015/- was required to be paid by the petitioner to the government exchequer and as the same was willfully not paid and the information thereto was also suppressed by the writ petitioner, the show cause notice was issued by invoking the extended period of time under Section 73(1) for recovery of the amount mentioned in the show cause along with the interest at the appropriate rate under Section 75 of the Finance Act, 1994. Thirty (30) days time was granted from the date of receipt of the show cause to the writ petitioner to show cause as to why the action contemplated in the show cause notice will not be initiated. The petitioner subsequently appeared before the respondent authority and submitted that no claim under Service Tax is liable to be paid by the petitioner. The peti