2017 (8) TMI 440 - AT - Service Tax

Short payment of tax - extended period of limitation - case of appellant is that Revenue was aware of the short payment in the year 2004 and therefore, extended period of limitation cannot be invoked - Held that - the knowledge of Revenue after the evasion has taken place, is irrelevant for invocation of extended period of limitation - appellant arguement on limitation fails. Adjustment of amount already paid - case of appellant is that they have already paid the entire amount of duty and therefore, same should be adjusted against the demand made - Held that - The appellants have not given any evidence to link the said payment with the service tax leviable during 14/05/2003 to 28/05/2003. In the absence of any evidence to link the two together, it is not the possible to allow adjustment of the said amount against the duty leviable. Appeal dismissed - decided against appellant.

Summary

Issues:
Confirmation of demand and imposition of penalty under Section 76 of the Finance Act, 1994; Invocation of extended period of limitation; Adjustment of already paid duty against the demand made.

Confirmation of demand and imposition of penalty under Section 76 of the Finance Act, 1994:
The appeal was filed against the confirmation of demand and imposition of penalty under Section 76 of the Finance Act, 1994. The appellant had paid service tax at 5% ad valorem during a specific period, although the rate had been revised to 8%. The matter was remanded back to the Commissioner (Appeals) to consider the issue on limitation, which was upheld by the Commissioner. The appellant argued that the Revenue was aware of the short payment, citing correspondence from 2004. The Tribunal considered the arguments but ultimately dismissed the appeal based on legal precedents and the lack of evidence supporting the appellant's claims.

Invocation of extended period of limitation:
The main contention revolved around the invocation of the extended period of limitation. The appellant argued that since the Revenue was aware of the short payment in 2004, the extended period of limitation should not have been invoked in 2006. However, the Tribunal referred to a decision of the Hon'ble High Court of Gujarat, emphasizing that the knowledge of Revenue after the evasion had taken place was irrelevant for invoking the extended period of limitation. The Tribunal concluded that the appellant's argument on limitation failed based on legal precedents and the interpretation of relevant laws.

Adjustment of already paid duty against the demand made:
Regarding the adjustment of the already paid duty against the demand made, the Deputy Commissioner noted that the appellant had made payments for certain periods but failed to provide evidence linking those payments to the specific period in question. The Tribunal highlighted that without evidence linking the payments to the duty leviable during the relevant period, the adjustment could not be allowed. Consequently, the appeal was dismissed due to the lack of substantiating evidence.

In conclusion, the Tribunal upheld the confirmation of demand and imposition of penalty under Section 76 of the Finance Act, 1994, dismissed the argument against the invocation of the extended period of limitation, and rejected the adjustment of already paid duty against the demand made due to insufficient evidence.