2010 (6) TMI 669 - AT - Service Tax

Summary

Issues involved:
Confirmation of demand of service tax liability under Section 11D of the Central Excise Act, 1944 and Section 73(2) of the Finance Act, 1994.

Analysis:
The issue involved in this case pertains to the confirmation of demand of service tax liability on the appellants on two counts: (i) demand under Section 11D of the Central Excise Act, 1944 for the amount collected as service tax, and (ii) demand under Section 73(2) of the Finance Act, 1994 for the value of the taxable service provided by the appellant. The appellant's counsel argues that the demand under Section 73(2) has already been paid along with interest and penalty, while the demand under Section 11D is beyond the five-year limit prescribed under Section 11A. The counsel cites various decisions in support of this claim. On the other hand, the Departmental Representative (DR) contends that Section 11D of the Central Excise Act does not have a time limit and relies on previous Tribunal decisions to support this argument. In response, the appellant's counsel refers to a decision by the Bench that emphasizes the need to read Section 11D in conjunction with Section 11A of the Central Excise Act.

The Tribunal carefully evaluates the submissions from both sides and examines the records. Regarding the demand for duty collected beyond five years under Section 11D, the Tribunal opines that such demand can only be raised under Section 73 of the Finance Act within a five-year period, provided there are allegations of suppression of facts or misstatement. Since there are such allegations in this case, the Tribunal decides that the demand within five years requires detailed scrutiny during the final appeal disposal. The Tribunal concludes that the appellant has not justified a complete waiver of the amounts upheld by the Commissioner (Appeals). Consequently, the Tribunal directs the appellant to deposit a specific amount within a stipulated timeframe and report compliance accordingly. Upon compliance with this directive, the Tribunal allows the application for waiver of pre-deposit of the remaining amount involved and stays the recovery until the appeal is disposed of.