2019 (4) TMI 1562 - AT - Service Tax

Business Auxiliary services - multi-level marketing activities - extended period of limitation - HELD THAT - The issue is decided in the case of PARAMJIT KAUR VERSUS C.S.T., DELHI 2018 (4) TMI 962 - CESTAT NEW DELHI , where it was held that Since the issue relates to interpretation of the taxability of service, the extended period of limitation cannot be invoked for confirmation of the service tax demand. Thus, the demand is barred by limitation, except a part of the period, for which the matter is being remanded to the lower authorities for quantification of the demand falling within the limitation period - penalty set aside - appeal disposed off.

Summary

Issues:
Confirmation of service tax under Business Auxiliary Services, invocation of longer period of limitation, applicability of Tribunal decisions on limitation period.

Confirmation of Service Tax under Business Auxiliary Services:
The judgment confirms the service tax against the appellant under the category of Business Auxiliary Services due to the multi-level marketing activities provided by them falling under this category. The appellant's advocate acknowledged that a previous Tribunal decision had decided against them in a similar case. However, she argued that the demand period was beyond the normal limitation period, citing the Tribunal's observation in a previous case that the disputed issue was being raised by multiple assesses and thus, no malafide intent could be attributed. The advocate also relied on another Tribunal decision to support her argument.

Invocation of Longer Period of Limitation:
The Revenue's representative argued that the longer period of limitation was rightly invoked because the appellant had not disclosed the multi-level marketing activities they were undertaking. He referred to a Tribunal decision where penalties were upheld on the assessee for non-disclosure. The judgment noted that while there was no dispute about the taxability of the activities, the demands were raised using the longer period. It referenced a Tribunal decision that stated the extended period of limitation cannot be invoked for confirming service tax demands related to contentious issues of taxability. Therefore, the demand was held to be barred by limitation, except for a part of the period which was remanded to lower authorities for quantification within the limitation period. The penalty was set aside, and the appeal was disposed of accordingly.

Applicability of Tribunal Decisions on Limitation Period:
The judgment emphasized the importance of Tribunal decisions in resolving issues related to the limitation period for confirming service tax demands. By following previous decisions, the Tribunal held that the demand in this case was barred by limitation, except for a specific period. The judgment provided a detailed analysis of how the Tribunal's decisions influenced the outcome of the case, highlighting the significance of legal precedents in determining the applicability of the limitation period in tax matters.

Conclusion:
The judgment in the case addressed the confirmation of service tax under Business Auxiliary Services, the invocation of the longer period of limitation, and the applicability of Tribunal decisions on the limitation period. It provided a detailed analysis of the arguments presented by both parties and referenced relevant Tribunal decisions to support the final decision. The judgment ultimately held the demand to be barred by limitation, except for a specific period, and set aside the penalty while remanding a part of the matter to lower authorities for quantification within the limitation period.