2016 (12) TMI 1733 - AT - Service Tax

Time Limitation - the submission of the appellant is that the proceeding initiated by the Service Tax department for recovery of service tax is barred by limitation of time in as much as the period involved is from January to June, 2004; whereas the show cause notice was issued on 28/07/2006, which is beyond the period of limitation prescribed under Section 73 - Held that - The issue with regard to the limitation aspect is settled by the Tribunal in the case of Jaipur Ex-Servicemen Welfare Cooperative Society Ltd. 2015 (2) TMI 660 - CESTAT NEW DELHI , this decision has analyzed the diverse views prevalent at the relevant time and thereafter has arrived at the conclusion that the extended period of limitation in Section 73 cannot be invoked to demand service tax. Appeal allowed on the ground of limitation.

Summary

Issues:
1. Service tax demand under Security Agency service category.
2. Barred by limitation - period involved and issuance of show cause notice.
3. Applicability of Tribunal's decision on limitation aspect.

Analysis:
1. The appellant in the appeal did not contest the service tax demand under the taxable category of Security Agency service. The appellant's representative acknowledged that the case's merits were against them, citing a judgment from the Hon'ble Punjab & Haryana High Court. However, the appellant argued that the Service Tax department's proceeding for recovery of service tax was time-barred as the show cause notice was issued beyond the prescribed limitation under Section 73, considering the period from January to June 2004. The appellant relied on the decision of Jaipur Ex-Servicemen Welfare Cooperative Society Ltd. vs. CCE, Jaipur to support their contention. The Revenue's representative reiterated the Commissioner (Appeals)'s findings.

2. The Tribunal considered the limitation aspect based on the case of Jaipur Ex-Servicemen Welfare Cooperative Society Ltd. The Tribunal's order highlighted that during the period in question, there were conflicting judgments regarding the taxability of Cooperative Societies under the Finance Act, 1994. It was noted that the Hon'ble Punjab & Haryana High Court's 2010 decision took a different view, leading to confusion. Citing relevant judgments, the Tribunal concluded that no malafide could be attributed to the appellant. The Tribunal held that the extended period of limitation under Section 73 could not be invoked for demanding service tax, ultimately leading to the service tax demand being considered time-barred for the period specified in the show cause notice.

3. The Tribunal found the issue addressed in the case of Jaipur Ex-Servicemen Welfare Cooperative Society Ltd. to be identical to the present matter. Given the analysis and conclusion in the prior decision, the Tribunal adopted the same reasoning to dispose of the present appeal. Consequently, the impugned order was set aside, and the appeal was allowed solely on the ground of limitation without delving into the case's merits. The decision was dictated and pronounced in open court for clarity and transparency.