2016 (6) TMI 724 - AT - Service Tax

Architect Services or Management or Business Consultant services - Extended period of limitation - Activity of providing construction or supervising of construction of building for Government institutions like Government hospital alongwith various activities - Held that - the appellant was correctly covered under Architect/Management or Business Consultants services. In November 2007, if not prior thereto, the Revenue was in the knowledge of the nature of the services rendered and therefore, the appellant does have an arguable case to contend that at least after November, 2007 it would have been in no position to indulge in suppression or willful statement. Therefore, the appellant does have prima facie a reasonable ground on the aspect of time bar which will make substantial part of the demand hit by bar of limitation. - prima facie case is in favor of assessee - Stay granted partly.

Summary

Issues:
1. Confirmation of service tax demand under Architect Service and Management or Business Consultants Services.
2. Allegation of suppression and time bar regarding the demand.

Analysis:
1. The appellant filed a stay application and appeal against the Order-in-Original confirming a service tax demand of ?65,75,890 under Architect Service and Management or Business Consultants Services. The appellant argued that the services provided were related to construction or supervising building construction for Government institutions, not covered under the specified services. The appellant also highlighted a letter from 2007 where the nature of the services provided was clarified to the Department, indicating no suppression. On the other hand, the Revenue contended that the services fell under Architect/Management or Business Consultants services as per the contract terms with Guru Ghasidas University, Bilaspur. The Revenue supported the order, alleging suppression by the appellant, regardless of when the Department became aware of the evasion.

2. The Tribunal considered both arguments and noted that while the 2007 letter mentioned construction/supervision charges, the contract terms did not specify building construction by the appellant. The Tribunal acknowledged the Revenue's point on the invocation of the extended period for willful misstatement/suppression, irrespective of the Department's awareness date. However, the Tribunal observed that the Revenue was aware of the services provided by November 2007, if not earlier, potentially limiting the scope for suppression or willful misstatement post that date. Consequently, the Tribunal found a reasonable ground for the appellant regarding the time bar, potentially affecting a substantial part of the demand.

In conclusion, the Tribunal ordered a pre-deposit of ?10 lakhs within 12 weeks to comply with statutory provisions. Failure to comply would result in the dismissal of the appeal. The remaining liability was stayed pending the appeal's outcome, provided the pre-deposit was made. Compliance reporting was set for a specific date, ensuring adherence to the order.