Service Tax Demand Based Solely on Form 26AS

The Karnataka High Court set aside a service tax adjudication order passed against Mr. G.N. Krishna, a PWD contractor, after observing that the adjudicating authority had primarily relied upon income reflected in Form 26AS and information received from the Central Board of Direct Taxes without properly examining the applicability of statutory exemptions under the Finance Act, 1994 and Notification No. 25/2012-ST. 

The Court remanded the matter to the stage of reply to the show cause notice and directed the authorities to reconsider the dispute in light of earlier judicial observations concerning negative list services, exemption notifications, reverse charge liability, and limitation principles.