2018 (9) TMI 40 - AT - Service Tax

Extended period of limitation - Business Auxiliary Services - Recovery Agent Services - Held that - Some demands have been paid by the appellant during investigation, the same is required to be verified by the Authorities below whether the said amount paid by the appellant covers the demand within the period of limitation or not? - Therefore, the matter needs examination at the end of the Adjudicating Authority. The learned Commissioner (Appeals) has observed that there is no willful intent of evade payment of service tax and the said order has not been challenged by the Revenue. In that circumstances, the extended period of limitation is not invokable as no mala fides are attributable to the appellant, therefore, the demands pertains to the extended period of limitation is set aside - Penalty also set aside. Appeal disposed off.

Summary

Issues:
1. Demand under 'Recovery Agent Services' confirmed for a specific period.
2. Invocation of extended period of limitation for issuing show cause notice.
3. Payment made by the appellant during investigation.
4. Verification of the amount paid by the appellant within the period of limitation.
5. Observations by the learned Commissioner (Appeals) regarding appellant's intent.
6. Remand of the matter to the Adjudicating Authority for calculation of recoverable amount.
7. Setting aside of the impugned order and non-invocation of extended period of limitation.
8. Imposition of penalty on the appellant.

The judgment addresses the issue of confirming the demand under the category of 'Recovery Agent Services' for a specific period, from May 2006 to August 2009, by invoking the extended period of limitation. The appellant, a recovery agent for ICICI Bank, received charges initially under 'Business Auxiliary Services' which later transitioned to 'Recovery Agent Services' for which service tax was sought to be recovered. The show cause notice was issued after a certain period, leading to the contention that the extended period of limitation should not be invoked due to payments made by the appellant during the investigation.

The Tribunal noted that some demands were indeed paid by the appellant during the investigation, and it was necessary for the Authorities to verify if these payments covered the demand within the period of limitation. Consequently, the matter was remanded back to the Adjudicating Authority for the calculation of the recoverable amount from the appellant along with interest within the period of limitation. The Tribunal also highlighted the observations made by the learned Commissioner (Appeals) that no willful intent to evade payment of service tax was found, leading to the non-invocation of the extended period of limitation as no mala fides were attributable to the appellant.

As a result, the impugned order was set aside, and no penalty was imposed on the appellant. The Tribunal emphasized that since the learned Commissioner (Appeals) had not been challenged by the Revenue regarding the absence of willful intent, the demands pertaining to the extended period of limitation were deemed to be set aside. The judgment concluded by disposing of the appeal based on these terms, ensuring a fair consideration of the appellant's payments, intent, and the applicable period of limitation.