2019 (4) TMI 440 - AT - Service Tax

Cable operator service - Failure to discharge service tax liability - MSOs raised bills to the appellant on account of service provided for receiving cable signals from them for onward re-transmission to their subscribers in Kota - period from 16.08.2002 to 31.03.2006 - time limitation - Held that - The impugned is the case of cable operator services. Those services brought into the tax net w.e.f. 16.08.2002 by amending Section 65 of Finance Act, 2008. Despite that the party had neither obtained registration from the Department under cable operator services nor filed ST-3 return to the Department. Rather, kept suppressing their value of taxable service till the year 2006, when the matter was actually scrutinized by the Department. There is no denial of the appellant that during the investigation, in furtherance of said scrutiny, his statement was recorded and requisite documents were provided by him. It is thereafter that the impugned show cause notice dated 09.10.2007 was issued by the Department. From the Order in Original it is apparent that the appellant despite being called almost five times could not appear. It is also apparent from the order that he not even filed the reply to the show cause notice. Thus the order announced against the appellant is for lack of evidence. Also, the knowledge of Order-in-Original was with the appellant in the year 2012 for filing the appeal which was filed in the year 2016. Time Limitation - Held that - Commissioner (Appeals) had limitation being a statutory mandate to not to condone the delay of more than three months. The delay herein Is of six years and for sake of arguments, if the argument of appellant about the period to reckon from the date of receipt of order is considered, the delay is still is of more than 5 months - Despite the knowledge and receipt of impugned SCN, the absence of any effort to enquire about the orders in furtherance whereof the recovery proceedings as mentioned in the said Newspaper except a letter dated 6th August, 2015 is not opined sufficient for condoning delay of almost 6 years. Same rather amount to be highly negligent act. There is no cogent reason still to provide opportunity to the applicant for the delay of 6 years from the date of Order-in-Original to have been condoned - appeal dismissed - decided against appellant.

Summary

Issues:
1. Failure to discharge service tax liability by the appellant for cable operator services.
2. Dismissal of appeal on the ground of limitation by the Commissioner (Appeals).

Analysis:

Issue 1: Failure to discharge service tax liability
The appellant, engaged in cable operator services, was found to have received signals from Multi System Operators (MSOs) and broadcast relay services, which were taxable. The Department observed non-payment of service tax by the appellant despite receiving bills from the MSOs. The appellant did not provide evidence during the investigation or in response to the show cause notice. The original order confirmed the demand of service tax, interest, and penalties due to lack of evidence from the appellant. The appellant's appeal was dismissed on the ground of limitation, leading to the appeal before the Tribunal.

Issue 2: Dismissal of appeal on limitation grounds
The appellant argued that the show cause notice was not served at the correct address and that they only became aware of the Order-in-Original through a newspaper in 2012. Subsequently, they deposited the service tax amount. The appellant claimed to have received a call about being declared an untraceable assessee in 2015. However, the Tribunal noted that the appellant's application and actions did not provide a sufficient reason for the delay of six years in filing the appeal. The Tribunal emphasized the importance of timely action and cited a case law to support the dismissal of the appeal due to the significant delay.

In conclusion, the Tribunal upheld the original order, dismissing the appeal and emphasizing the need for timely compliance and providing valid reasons for delays in legal proceedings.