2017 (5) TMI 1202 - AT - Service Tax

Penalty - Extended period of limitation - Commercial Training & Coaching Centre Service - Held that - the claim of the respondent for exemption under N/N. 6/2005-ST was not allowed. The impugned order has already been upheld with reference to time bar and setting aside the penalty imposed u/s 78 - when the demand was not sustainable for the extended period, penalty u/s 78 was also not imposable. Such penalty was set aside - appeal dismissed - decided against Revenue.

Summary

Issues:
1. Appeal against order of Commissioner of Central Excise (Appeals) restricting demand for service tax.
2. Appeal by Revenue challenging restriction of demand for extended period.
3. Tribunal's Final Order allowing appeal by setting aside demand for extended period and penalty under Section 78 but not allowing exemption under notification no.6/2005-ST.
4. Dismissal of Revenue's appeal by Appellate Tribunal CESTAT NEW DELHI.

Analysis:
1. The case involved an appeal by the Revenue against the order of the Commissioner of Central Excise (Appeals) restricting the demand for service tax against the respondent, engaged in providing taxable service under "Commercial Training & Coaching Centre Service". The Original Authority had confirmed a service tax liability and imposed penalties under various sections of the Finance Act, 1994. On appeal, the Commissioner (Appeals) restricted the demand to the normal period, not invoking the extended period against the respondent. The demand for the normal period was confirmed along with penalties. The Revenue was aggrieved by this order, arguing that the demand for the extended period should have been confirmed.

2. The Appellate Tribunal considered the arguments from both sides and reviewed the appeal records. The respondent had challenged the Commissioner (Appeals) order before the Tribunal, which in Final Order NO.50007 of 2017 dated 3.1.2017, allowed the appeal by setting aside the demand for the extended period and the penalty under Section 78. However, the claim for exemption under notification no.6/2005-ST was not granted. The Tribunal upheld the findings of the Commissioner (Appeals) regarding the time bar and held that since the demand was not sustainable for the extended period, the penalty under Section 78 was also not applicable.

3. The Appellate Tribunal, after reviewing the Final Order of the Tribunal dated 3.1.2017, found that the decision of the Division Bench involving the same impugned order confirmed that there was no issue remaining for consideration. The Tribunal upheld the time bar findings and the setting aside of the penalty under Section 78. Consequently, the appeal by the Revenue was dismissed, and the Cross objection was also disposed of. The judgment was dictated and pronounced in open court, concluding the legal proceedings in this matter.