2014 (7) TMI 1045 - AT - Service Tax

Cargo handling service - Revenue contends that Commissioner travelled beyond SCN - Commissioner while deciding the case relied upon on the work orders which were not covered in the show-cause notice - Held that - Commissioner has proceeded on the premise that the period and amount in the bills raised tally with the contracts considered by him. He has considered the work orders shown in para 6 of his order despite attempting the fact that he himself agreed there is mismatch of this contract number vis-a-vis the contract number mentioned in the show-cause notice. Moreover, there is no whisper of the contract number mentioned in show-cause notice, by the respondent in their written submission dated October 7, 2009. Therefore, we find that the learned Commissioner has traversed beyond the scope of show-cause notice and this work requires to be examined. Therefore, after setting aside the learned Commissioner s order we remand the matter to learned Commissioner to decide the case afresh - Decided in favour of revenue.

Summary

Issues:
1. Whether the learned Commissioner correctly confirmed the demand of service tax and penalty against the respondent.
2. Whether the learned Commissioner exceeded the scope of the show-cause notice by relying on work orders not covered in the notice.
3. Whether the demand for service tax is time-barred due to delayed issuance of the show-cause notice.

Analysis:
Issue 1:
The Revenue appealed against the order confirming the demand of service tax and penalty imposed by the learned Commissioner. The respondent provided transportation services, including loading and unloading coal, without registering for service tax or filing statutory returns. The Revenue contended that the Commissioner erred in not considering certain work orders issued by M/s. Tata Sponge Iron Ltd., which revealed that the services provided were taxable under cargo handling and business auxiliary services. The Commissioner confirmed a portion of the demand and penalty, leading to the Revenue's appeal.

Issue 2:
The Revenue argued that the Commissioner exceeded the scope of the show-cause notice by relying on work orders not mentioned in the notice. The Revenue cited various tribunal decisions to support their contention. The Commissioner's reliance on specific work orders not covered in the show-cause notice was a key point of dispute. The Revenue claimed that the Commissioner failed to consider all relevant aspects mentioned in the notice, leading to a challenge regarding the validity of the decision based on the scope of the notice.

Issue 3:
Regarding the timeliness of the demand for service tax, the respondent argued that the show-cause notice was served beyond the normal period prescribed by law. They highlighted that the audit conducted in 2006 led to a delayed issuance of the notice in 2008, which they deemed time-barred. The respondent relied on a tribunal decision to support their argument that the demand based on returns and audit checks beyond the normal period cannot be invoked. The issue of the delayed notice and its impact on the demand for service tax formed a crucial aspect of the case.

In the judgment, the Tribunal found merit in the Revenue's contention regarding the Commissioner exceeding the scope of the show-cause notice by relying on specific work orders not covered in the notice. As a result, the Tribunal set aside the Commissioner's order and remanded the matter for a fresh decision. Both parties were granted the opportunity to present relevant documents, and a fair hearing was emphasized. The appeal was allowed by way of remand, and the counter filed by the respondent was also disposed of. The Tribunal's decision focused on upholding procedural fairness and ensuring that all relevant aspects are considered within the scope of the original notice.