Hon'ble Judges/Coram:
Rachna Gupta

ORDER

Rachna Gupta, Member (J)

1. Appellant has filed this impugned appeal being aggrieved by Order-in-Appeal No. 011/2019-20.

2. Relevant factual matrix is as follows:

The appellant, M/s. Shubh Labh Reality Private Limited, is engaged in providing construction of residential complex services. During the course of audit of the records, for the period 2012-2013 to 2015-2016, the Department noticed that the appellant has failed to pay the interest liability of Rs. 88,754/- on the delayed payment of service tax as required under Section 75 of the Finance Act, 1994 alleging that the service tax liability arise on the date of the sale deed of the constructed property. Department also observed that the appellant is providing said taxable services but without payment of service tax despite that the constructed property were sold after obtaining completion certificate from the Architect. It is alleged that the certificate was to be obtained from the competent authority which was Indore Municipal Corporation (IMC), Indore instead of Gram Panchayat Chota Bangarda. Based on these observations that a Show Cause Notice bearing No. 2819 dated 24.10.2017 served upon the appellant proposing the recovery of service tax of Rs. 3641231/- and the recovery of interest of Rs. 88,754/- being not paid by the appellant along with the interest at proportionate rate and the appropriate penalties. The said proposal was initially got confirmed vide the Order-in-Original No. 49/2018-19 dated 15.1.2019 has been rejected by Commissioner (Appeals) vide the order under challenge.

3. I have heard Ms. Priyanka Goel, learned Counsel for the appellant and Shri Pradeep Juneja, learned Departmental Representative for the Department.

4. It is submitted on behalf of the appellant that the appellant started constructing residential complex in the year 2010 with the permission dated 15.1.2011 as was received from Gram Panchayat, Chota Bangarda. After constructing the same completion certificate was also obtained from the said Gram Panchayat on 22.2.2013, it is submitted that the Department has issued the Show Cause Notice on the wrong ground that the area where appellant has constructed the residential complex, falls under IMC and not under the limits of said Gram Panchayat. It is impressed upon that though there was a notification dated 5.2.2013 issued by the Government of Madhya Pradesh declaring the impugned area to fall under IMC, but the said notification has been quashed by the High Court Madhya Pradesh vide an order dated 3.2.2014 announced in TIOL-5196 of 2013. It is impressed upon that since notification stands quashed the property continues to fall under the jurisdiction of Gram Panchayat and the completion certificate of 22.2.2013 stands valid. Accordingly, there is no evasion of service tax on part of the appellant as is alleged by the Department thus the demand the thereof has wrongly been confirmed by the adjudicating authority below.

5. With respect to the demand of interest, it is submitted that the service tax was paid by the appellant as and when appellant used to receive the installment of the sale consideration. Date of sale deed/Registry of the property has wrongly been taken as the point of taxation. No question arises of any interest liability on the appellant. Otherwise also the amount of Rs. 88,754/- has wrongly been calculated the calculation given at page No. 116 is impressed upon. Finally, it is submitted that there is no mis-representation or suppression of facts on part of the appellant, as is alleged by the Department. The appellant had obtained the completion certificate from the same authority which had issued the permission to construct the said complex. Hence there was bona fide belief for Gram Panchayat, Chota Bangarda to be the competent authority in terms of Section 66E(b) of Finance Act, 1994. The Department has wrongly invoked the extended period of limitation. With these submissions, appellant has prayed for the ord........