Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2026 Supreme(Online)(CESTAT) 499

IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
EASTERN ZONAL BENCH: KOLKATA
REGIONAL BENCH – COURT NO. 1

Service Tax Appeal No. 75164 of 2026
(Arising out of Order-in-Appeal No. 453/ST-KOL/ST/KOL-S/2025-26 dated 17.11.2025 passed by the Commissioner, Central Goods and Service Tax and Central Excise, Appeal-I Commissionerate, Kolkata, G.S.T. Bhawan, 8th Floor, 180, Shantipally, Rajdanga Main Road, Kolkata – 700 107)

AND
Service Tax Appeal No. 75165 of 2026
(Arising out of Order-in-Appeal No. 581/ST-Kol/ST/Kol-S/2025-26 dated 30.12.2025 passed by the Commissioner, Central Goods and Service Tax and Central Excise, Appeal-I Commissionerate, Kolkata, G.S.T. Bhawan, 8th Floor, 180, Shantipally, Rajdanga Main Road, Kolkata – 700 107)

M/s. Jeetu Madnani
2nd Floor, 40, Lake Avenue,
Kolkata – 700 026
: Appellant
VERSUS
Commissioner of C.G.S.T. and Central Excise
Kolkata South Commissionerate,
G.S.T. Bhawan, 180, Shantipally, Rajdanga Main Road,
Kolkata – 700 107
: Respondent

M/s. Jeetu Madnani
2nd Floor, 40, Lake Avenue,
Kolkata – 700 026
: Appellant
VERSUS
Commissioner of C.G.S.T. and Central Excise
Kolkata South Commissionerate,
G.S.T. Bhawan, 180, Shantipally, Rajdanga Main Road,
Kolkata – 700 107
: Respondent

APPEARANCE:
Smt. Shreya Mundhra, Advocate,
Shri Adrish Dutta, Advocate,
For the Appellant
Shri S. Dutta, Authorized Representative,
Ms. Suman, Authorized Representative,
For the Respondent

CORAM:
HON’BLE SHRI K. ANPAZHAKAN, MEMBER (TECHNICAL)

FINAL ORDER NOs. 75447-75448 / 2026
DATE OF HEARING / DECISION: 25.03.2026

Advocates:
For the Appellants/Petitioners: Shreya Mundhra, Adrish Dutta
For the Respondents: S. Dutta, Suman

The invocation of the extended period of limitation under Section 73 of the Finance Act, 1994 requires proof of intentional suppression; demands based solely on data reconciliation mismatches, in the absence of independent investigation and where data is already available to the Revenue, are barred by limitation.

Headnote:(A) Finance Act, 1994 - Section 73 - Service Tax - Limitation - Whether Department can invoke extended period of limitation solely based on mismatch between ITR/Form 26AS and ST-3 returns without independent verification - Held, when records were already subjected to departmental audit and all transactions were reflected in books of accounts, allegation of suppression cannot be sustained for invoking extended period.

(B) Show Cause Notice - Subsequent issuance - Where first show cause notice is issued, subsequent show cause notice for a later period on the same issue cannot invoke extended period of limitation as the facts were already within Departmental knowledge.

Facts of the case:
The appellant, a registered service provider, was issued two show cause notices covering different periods, demanding differential service tax based on a reconciliation mismatch between ITR/Form 26AS figures and ST-3 returns, by invoking the extended period of limitation under Section 73 of the Finance Act. These demands were confirmed by the adjudicating authority and upheld by the Commissioner (Appeals).

Findings of Court:
The Tribunal found that the Department failed to conduct independent investigation into the actual nature of services rendered. It further noted that the appellant had been filing returns and submitting documents during previous audits where no objections were raised, refuting the allegation of wilful suppression.

Issues: Whether the invocation of the extended period of limitation under Section 73 of the Finance Act, 1994 was legally justified based on ITR/Form 26AS mismatches, and whether subsequent show cause notices are sustainable.

Ratio Decidendi: Demands raised solely on data available in the Income Tax portal without independent verification of the nature of services do not constitute suppression; thus, the extended period of limitation cannot be invoked. Additionally, a second show cause notice on the same issue where facts were already known at the time of the first notice is impermissible.

Result: Appeals allowed.

ORDER:

These appeals have been preferred by M/s. Jeetu Madnani, 2nd Floor, 40, Lake Avenue, Kolkata – 700 026 (hereinafter referred to as the “appellant”) against the Order-in-Appeal No. 453/ST-KOL/ST/KOL-S/2025-26 dated 17.11.2025 and Order-in-Appeal No. 581/ST-Kol/ST/Kol-S/2025-26 dated 30.12.2025 (hereinafter collectively referred to as the “impugned orders”) whereby demands of Service Tax of Rs.18,27,426/- (inclusive of cess) and Rs.38,45,000/- (inclusive of cess), totally amounting to Rs.56,72,426/-, along with interest and penalties thereon, have been upheld.

2. The facts of the case are that the appellant is registered under the jurisdiction of Range-III of Behala Division, Kolkata South Commissionerate, for rendering the services of promotion or marketing of brands, services, events and other taxable services. The appellant has been paying Service Tax and submitting ST-3 Returns up to 30.06.2017 and thereafter, the appellant has been paying tax as applicable under the G.S.T. regime, in respect of the said services.

3. On the basis of comparison between the Form 26AS statement received from the Income Tax Department and the ST-3 Returns filed by the appellant, during the period from October, 2014 to March, 2015, a Show Cause Notice dated 29.09.2020 was issued, demanding Service Tax of Rs.18,27,426/- (inclusive of Cess) for the period from October, 2014 to March, 2015 by invoking the extended period of limitation, being the differential service tax payable as observed from the ITR / Form 26AS and ST-3 Returns filed by the appellant during the said period. The allegation of the Revenue is that the appellant has wilfully suppressed the above differential taxable value with the intent to evade payment of Service Tax.

3.1. Subsequently, another Show Cause Notice dated 28.12.2020 was issued demanding Service Tax of Rs.38,45,000/- (inclusive of cess) for the period from April, 2015 to June, 2017 on the basis of the difference in figures as available in the ITR / Form 26AS and the ST-3 Returns filed by the appellant during the above period, by invoking the extended period of limitation under the same allegations.

4. The above said Show Cause Notices were thereafter adjudicated and the demands raised in these two Show Cause Notices were confirmed, along with interest, by the ld. adjudicating authority vide the Original No. 156/AC-DC/CGST&CX/Behala/Jeetu Madnani/Kol-South/2023. Order-in-Original No. 157/AC-DC/CGST&CX/Behala/Jeetu Madnani/Kol-South/2023 both dated 31.08.2023; penalties under Sections 78(1) of the Finance Act, 1994 and 77(2) of the Finance Act, 1994 were also imposed.

4.1. The appellant challenged the above adjudication orders before the Ld. Commissioner (Appeals), who, vide the impugned orders, has upheld the demands of Service Tax confirmed therein, along with interest and penalties.

4.2. Aggrieved by the confirmation of the demands of Service Tax, along with interest and penalties, the appellant has filed the instant appeals.

5. During the course of hearing, the Ld. Counsel appearing on behalf of the appellant submitted that the appellant has registered with the Service Tax Department and has been paying Service Tax regularly under the category of “promotion or marketing of brands / service / events service” and “other taxable service”. It is also submitted that the Departmental audit on the records of the appellant, in both these cases, was done covering the period from April, 2014 to June, 2017 and no objection was raised by the Audit parties on scrutiny of their records; the Final Audit Report dated 02.12.2019 issued did not raise any objections regarding the alleged mismatch between the values declared in the ITR and ST-3; however, later, pursuant to the comparison of ITR / Form 26AS and ST-3 Returns undertaken by the Department, both the Show Cause Notices in question have been issued and the demands have thereafter been confirmed. It is the submission of the Ld. Counsel for the appellant that the Departmen

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