2020 (2) TMI 191 - AT - Service Tax

Extended period of limitation - penalty - demand of service tax under the category of Business Auxiliary Service - HELD THAT - As the issue has been decided by this Tribunal in the case of MR. CHARANJEET SINGH KHANUJA AND OTHERS VERSUS CST, INDORE/LUCKNOW/JAIPUR/LUDHIANA AND OTHERS 2015 (6) TMI 585 - CESTAT NEW DELHI and this decision has been followed in various cases, wherein the benefit of extended period of limitation is granted. Thus, in the cases in hand, the extended period is not invokable, consequently, no penalty is not imposable on the appellants - appellants are directed to deposit service tax for the period within the limitation period within 30 days along with interest after communication of this order - appeal disposed off.

Summary

Issues:
Appeal against service tax demand under 'Business Auxiliary Service' category, interest, and penalty imposition.

Analysis:
The appellants, distributors of a company engaged in multi-level marketing, were demanded service tax under 'Business Auxiliary Service' along with interest and penalties. The distributors introduced customers who made purchases, leading to a chain where discounts were given, and part of the discount was received by the distributors. The Revenue issued show cause notices invoking the extended period of limitation. The appellants contended that the extended period of limitation was not applicable, citing a Tribunal case. The Revenue argued for the applicability of the extended period based on a different Tribunal decision. The Tribunal noted that in the previous case cited by the appellants, the issue of limitation was not raised, unlike in the present case where the appellants sought the benefit of the extended period.

The Tribunal considered the precedent set by a case where it was held that the extended period of limitation was not invokable. It was also noted that this decision had been followed in other cases, granting the benefit of the extended period of limitation. Consequently, the Tribunal held that in the present cases, the extended period was not invokable, leading to the conclusion that no penalty could be imposed on the appellants. The appellants were directed to deposit the service tax within the limitation period along with interest. The appeals were disposed of accordingly.