This appeal under section 66 of the PSTSA, 2012, was filed against the order dated 01.03.2018 passed by the Commissioner HQ's. The facts culminating into this appeal are that on 05.12.2017 Additional Commissioner Enf- II issued a show-cause notice to the appe llant stating therein that the appellant being a company registered as service provider was required to withhold and deposit the tax regarding taxable services received from 01,01.2016 to 31.12.2016, under the (Withholding) Rules of the PSTSA , 2012, according to the following table.
Nature of T axable Services ReceivedAmount Paid (In Rs.)Punjab sales tax deductible and payable (In Rs.)
Legal and Professional Charges45,425,000 7,268.000 Repair and Maintenance 62,985,000 10,077,600 Stationary and Printing (if done under contract)98,598,000 15,775,680 Advertisement and Publicity 13,430,000 2,148,800 Auditor's Remuneration 5,724,000 915,840 Total 226,162,000 36,185,920 The show-cause notice further charged the appellant with violation of sections 14 and 19 of PSTSA, 2012 read with (Withholding) Rules, 2015. The notice further stated that why penalty under section 48 of the Act may not be imposed and why default surcharge under section 49 of the said Act may also not be charged and that why all these amounts may not be recovered under section 70 of the Act.
2. After receipt of the show-cause notice, the appellant submitted its written reply dated 28.02.2018 before the concerned officer of the authority after availing many adjournments. Thereafter , the order impugned was passed on 01.03.2018 by the commissioner HQ's. Feeling aggrieved, the instant appeal was filed.
3. Learned counsel for the appellant has argued that the show-cause notice dated 05.12.2017 was vague because it contained the figures of other provinces along with the Punjab Province and of the Capital territory , as well;- That the show-cause notice was issued by the Additional Commissioner Enf-02 whereas the final order was passed by the Commissioner HQ's which is illegal;- That there are serious contradictions in the show-cause notice and the order impugned because the basis of the show-cause notice and of the final order are different;-That the order impugned was passed on presumption and guess work;-That under the tax laws there is no room for applying the presumptive formula of percentage;- That the appeal was filed within time from the dated of knowledge and receipt of the impugned order;- That the certified copy of order impugned was received on 29.06.2019;- That although the order was passed on 01.03.2018 but it was never communicated to the appellant and that the appellant came to know about the impugned order on 26.06.2019 when the recovery notice under section 70 of the Act was received, where after the appellant applied for obtaining certified copy of the same. Lastly argued that the appeal may kindly be accepted and the order impugned may be set-aside.
4. On the contrary , learned DR has opposed the merits of this appeal by arguing that the appellant has nowhere denied the confronted amount of the audited accounts which were made basis for the issuance of show-cause notice by the authority;- that a fair and complete opportunity of audience was provided to the appellant through various adjournments but no evidence vis a vis transactions pertaining to capital territory and other provincial tax authorities was produced to rebut the demand of tax as is mentioned in the show- cause notice and the impugned order . The learned DR further reiterated that the appellant instead of asking the department to come up with a definite figure in its show-cause was duty bound to produce all such record being the custodian of that record.
Lastly it is argued that the appeal may kindly be dismissed being filed without merits.
5. Arguments heard. Record Perused.
6. Along with this appeal, application for condonation of delay in filing the appeal is also accompanied. The order impugned was passed on 01.03.2018. It is notable that nowhere in the impugned order it is mentioned or directed that the copy of the same be transmitted to the appellant. Furthermore, neither the copy of impugned order was dispatched to the appellant nor any intimation of the passing of the final order was given. The contention of the appellant is that the final/impugned order came into his knowledge on 26.06.2019 when recovery notice under section 70 of PSTSA, 2012, dated 18.06.2019 was received and that thereafter , the appellant applied for obtaining the certified copy of the impugned order which was delivered on 29.06.2019 and on 06.07.2019, this appeal was filed therefore, it is well within time. The contention of the appellant appears to be correct coupled with the fact that the whole argument on the point of limitation is not controverted by the learned DR., resultantly this appeal is considered and entertained as filed within limitation.
7. Adverting to the merits of the case, it is noted by this tribunal that in the show-cause notice dated 05.12.2017, the first date of hearing was fixed for 21.12.2017 but no hearing of the case ever took place on the said date. On page No.03 of the impugned order , the last two paragraphs find mention of the 1st date of hearing as on 19.12.2017 and on 14.02.2018.
It is an admitted fact that the show-cause notice contains the figures pertaining to the provinces and the capital territory and of the province of Punjab as well. In its reply dated 28.02.2018 the appellant pointed out this fact and highlighted/bifurcated the figures pertain ing to respective heads against services received by the appellant in Punjab and other than Punjab. In the 2nd last paragraph of the said reply the appellant had requested the authority to inform him if any other document/information is required. The said paragraph is reproduced for convenience:- "Further it is also requested that if your good self requires any other Documents/information kindly confront us specifically through notice."
Along with the above stated reply , the appellant submitted/provided complete details and copies of CPRs to strengthen its contentions. (as mentioned in the 4th bullet point of the reply). In the impugned order the Commissioner HQ's stated. "the registered person only submitted system generated/excel based details of expenses confronted in show-cause notice. The same needed to be supported with original ledger and invoices. Therefore, contention of the taxpayer is rejected."
All the facts mentioned above, give an impression to this tribunal that the Commissioner HQ's was under the influence of some unseen haste and therefore, ignored the pivotal point in the case. If there was no 'evidence/documents before the Commissioner on the basis of which he could have passed a good speaking order based on exactness of the figures, the Commissioner was bound to ask the taxpay er to provide him the documents by specifying the nature and type of those documents particularly , when the appellant himself had stated in the reply that he may be confronted specifically about the requirements of any other documents/information. The Commissioner HQ's did not bother to ask the taxpayer for the provision of the documents/evidence necessary for the effective calculation of the tax demand rather preferred to passed the order on the basis of presumptions and guess work by applying the formula of percentage. A decision made after thoroughly thrashing out the evidence to dig out the truth is always better than an order having a limp in it because of making no or a weak or halfhearted effort to go to the root of the dispute. There is no cavil in the proposition that in tax laws there is no room for presumptions and guess work and that the tax demand should always be based on exact figures which is missing in the impugned order therefore, it is set aside. The appeal in hand is accepted.
The case is remanded back to the competent officer with a direction to decide it afresh after giving only one clear opportunity to the appellant for providing/ submitting the documents/evidence, he feels necessary in support of his contention. It is also directed to the officer concerned that he may also call for the record/documents from the appellant which in his opinion, is/are necessary for making a decision based on exactness. The appellant/taxpayer is directed to substantiate its contentions by producing all the supporting evidence/documents including returns / ledgers/invoices and CPRs pertaining to all the respective provincial sales tax authorities to avoid any branch wise formula by the assessing of ficer, with these observations, this appeal is disposed of f.
The Registrar of the Tribunal is directed to communicate this order to all concerned immediately . File of appeal be consigned to record room.