2024 (3) TMI 347 - AT - Service Tax

Seeking adjustment of excess payment against future liability, if not adjusted already - demand of interest and penalty as well - extended period of limitation - HELD THAT - The assessee has submitted a statement of actual receipts made by them in each month. After adjusting the excess and short payment, the audit has arrived at the short-payment of Service Tax of Rs.3,83,042/- for the period 2007-08 to 2008-09. Accepting the demand of the Department, the appellant paid the amount of Rs.3,83,042/- on 08.04.2010 vide Challan No.06 through e-payment. However, the Show Cause Notice was issued later, demanding Service Tax of Rs.73,92,587/- on 13.01.2012. The appellant has not suppressed any information from the Department. They have been filing returns regularly. The audit has examined all the accounts and found only a short payment of Rs.3,83,042/- for the years 2007-08 to 2008-09. Hence, there is no suppression of facts with intent to evade payment of duty established in this case. Accordingly, the demand of Service Tax confirmed in the impugned order by invoking the extended period of limitation is not sustainable. The demand of Service Tax, if any, beyond the normal period of limitation, is not sustainable. The appellant is liable to pay Service Tax for the normal period of limitation, if not already paid by them - Appeal disposed off.

Summary

Issues involved:
The judgment involves the confirmation of Service Tax demand, adjustment of excess payment, imposition of interest, and penalty.

Confirmation of Service Tax Demand:
The appellant filed an appeal against the Order in Original confirming a Service Tax demand of Rs.69,23,211/-, including cess, for the Financial Years 2007-08 to 2010-11. The appellant had short-paid an amount of Rs.3,83,042/-, which was allowed to be adjusted against excess payment. The impugned order also imposed interest and an equal amount of tax demand as penalty.

Submission by Appellant:
The appellant argued that there was no suppression of facts, as they had paid the differential duty highlighted by the audit. They acknowledged the liability to pay interest of Rs.1,05,581/- and requested setting aside the demands of Service Tax along with interest.

Observations and Decision:
The Tribunal observed that the appellant had not suppressed any information and had been filing returns regularly. The audit identified a short payment of Rs.3,83,042/- for the years 2007-08 to 2008-09. Therefore, the demand of Service Tax confirmed in the impugned order by invoking the extended period of limitation was deemed unsustainable. The appellant was directed to pay the interest amount, while the demand beyond the normal period of limitation was set aside.

Order:
The Tribunal passed the following orders:
i. Set aside the demand confirmed beyond the normal period of limitation.
ii. Directed the appellant to pay the undisputed interest amount of Rs.1,05,581/-.
iii. Allowed adjustment of the short-payment against excess payment and eligibility for future liability adjustment.
iv. Disposed of the appeal based on the above terms.