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TMI Blog2023 (8) TMI 851X X X X Extracts X X X X X X X X Extracts X X X X ..... f the appellant that they are not liability to pay service tax cannot be doubted, questioned.In such situation the extended period which can be invoked only on the ingredient such as suppuration of fact, mis-statement, fraud, collusion with intent to evade payment of Service Tax, cannot be invoked. This Tribunal has consistently taken a view that on the issue of taxability on sub-contractor the extended period cannot be invoked this has been considered in M/s. Synergy Engineers Group Pvt. Ltd. Delhi [ 2023 (2) TMI 478 - CESTAT NEW DELHI] . Thus, it is consistently held that in the case of Service Tax liability on the sub-contractor demand for the extended period cannot be sustained in the light of the larger bench judgment in the case of M/s Melange developers Pvt. Ltd - the entire demand being issued for extended period i.e. beyond one year from the date of show cause notice shall not sustain on limitation alone. The impugned order set aside - appeal allowed. - MR. RAMESH NAIR, MEMBER (JUDICIAL) AND MR. C L MAHAR, MEMBER (TECHNICAL) None for the Appellant Shri, Rajesh Nathan, Assistant Commissioner (AR) for the Respondent ORDER The brief facts of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pellant that the only issue that remains for consideration before this Hon ble Tribunal is whether service tax demand can be sustained invoking extended period of limitation, where appellant has provided the aforesaid services in the capacity of sub-contractor and main contractor has discharged the service tax on the total contract value. It is submitted that the issue in no longer res-Integra in view of the following decision of this Tribunal wherein it was held that during the period of dispute the liability of sub-contractor for the payment of Service Tax was not free from doubt and which was only settled by the larger bench of Tribunal in the case of M/s Melange developers Pvt. Ltd reported in 2019(60) TMI 518 CESTAT (New Delhi), M/s. Synergy Engineers Group Pvt. Ltd. Reported in (2023) 5 CENTAX 158 (Tri.-Del), M/s. Vinoth Shipping Services reported in 2021 (55) GSTL 313 (Tri. Chennai), M/s. Vishal Engineering Company Vs. Commissioner of Central Excise and Service Tax Commissionerate, Panchkula reported in 2023 (7) TMI 260- CESTAT (Chandigarh). 2.3 It is further submitted that during the period under dispute because of conflicting decisions and ambiguity of the law the matte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The issue as to whether the extended period of limitation could be invoked in such a situation when there are conflicting views of the Tribunal on a particular issue has been considered by the Supreme Court in various decisions. 16. In Jaiprakash Industries Ltd. vs. Commissioner of Central Excise, Chandigarh, the Supreme Court held that when there are divergent views of High Courts, there can be a bona fide doubt as to whether the activity would amount to manufacture and in such circumstances it cannot be urged that there was mis-statement or suppression of facts with intent to evade payment of duty. 17. In Commissioner of Central Excise, Vapi vs. Kolety Gum Industries', the Supreme Court held that when there are conflicting judgments of the Tribunal, the assessee may have a bona fide belief that service tax is not payable and in such a situation, the extended period of limitation cannot be invoked by the Department. 18. In Continental Foundation Joint Venture vs. Commissioner of Central Excise, Chandigarh, the Supreme Court held that when there is a scope for entertaining a doubt about the view to be taken, the extended period of limitation cannot be invoked. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ds. In such situation, there is a clear possibility for a bona fide belief that as the whole amount has been subjected to service tax the amount received by the appellant may not be liable to service tax in connection with the services rendered by them. The issue involved has been a subject matter of interpretation by the Tribunal and High Courts. In fact the earlier Circular issued by the Board, covering the period prior to the introduction of Cenvat Credit Rules gave an impression that when the main service provider discharged the service tax on gross value there may not be tax liability on the sub-contractor rendering similar service to the main contractor. The Tribunal in various cases held in such a case involving interpretation of law and also a bona fide belief regarding service tax liability, will not attract the demand for extended period. We also take note that service tax liability on the appellant when discharged will be available as a credit to RSIC which can be used by RSIC for discharging their overall service tax liability. As such, to impute motivation to the appellant for intention to evade payment of duty is not sustainable. A reference can be made to the Tribuna ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9.2.3 There is no clear allegation that the appellants have wilfully suppressed facts with the intention to evade payment of Service Tax. In the present case, the main contractor M/s. ACL collected the full consideration including Service Tax from the clients, which is clear from the records. Appellants from the very beginning have raised the contention that they were instructed by M/s. ACL that they are not required to pay the Service Tax. We cannot find any factual basis for invoking the extended period. 9.3 We therefore hold that the demand raised by invoking the extended period cannot be sustained and requires to be set aside, which we hereby do. 10. From the discussions, we hold that the appeal fails on merits. However, we hold that the demand for the extended period of limitation, if any, cannot sustain and the impugned order to this extent is set aside, without disturbing any demand that falls within the normal period. For the same reasons, we find that the penalties cannot sustain. We set aside the same. The appellant succeeds on the ground of limitation only. 11. The appeal is disposed of on above terms. In the case of M/s. Vishal Engineering C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e note that service tax liability on the appellant when discharged will be available as a credit to RSIC which can be used by RSIC for discharging their overall service tax liability. As such, to impute motivation to the appellant for intention to evade payment of duty is not sustainable. A reference can be made to the Tribunal's decisions in British Airways v. CCE (Adjn.), Delhi reported in 2014 (36) STR. 598 (Tri. - Del.). Atul Ltd. v. CCE. Surat-Il reported in 2009 (237) E.LT. 287 (Tri- Ahmd.). In the facts and circumstances of this case, we find that the demand for extended period is not sustainable. We have also perused the reasons recorded by the Original Authority for invoking extended period of demand. He recorded that but for the Department's investigation the non- payment of tax would not have come to the notice. Further, the balance sheet for certain years have not been furnished in time by the appellant which was obtained from Registrar of Companies. As such, it was held that the appellants wilfully suppressed material facts. We find that the service tax demand against the appellant was sought to be confirmed mainly on the basis of the terms of agreement between ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TR. 335 (Tri-Del.) -2009-TIOL-526-CESTAT- DEL -Harshal Company v. CCE, Vadodara - 2008 (12) S.TR. 574 (Tri-Ahmd.) -Semac Pvt. Limited v. CCE, Bangalore-2006 (4) S.TR. 475 (Tr.- Bang) 2006-TIOL- 1546- CESTAT-BANG -Shiva Industrial Security Agency v. CCE, Surat 2008 (12) S.T.R. 496 (Tri-Ahmd.) -Synergy Audio Visual Workshop P. Ltd. v. CST, Bangalore 2008 (10) STR. 578 (Tri-Bang)= 2008-TIOL-809-CESTAT-BANG -OIKOS v. CCE, Bangalore 2007 (5) S.T.R. 229 (Tri-Bang)= 2006-TIOL-1760-CESTAT-BANG In the Tribunal's decision in the case of OIKOS v. CCE. Bangalore - III reported in 2007 (5) S.T.R. 229 confirmed against the sub-contractor. To the similar effect the Tribunal decision in the case of Viral Builders v. CCE, Surat reported in 2011 (21) S.TR. 457 (Tri-Ahmd.) =2010-TIOL-1575- CESTAT- AHM observed that service stands provided only once and as such tax is not payable twice for the same service. Further in the case of Sunil Hi-Tech Engineers Ltd. v. CCE, Nagpur reported in 2010 (17) S.T.R. 121 (Tri-Mumbai) 2009-TIOL-1867-CESTAT-MUM, the service tax confirmed against the sub-contractor was set aside on the ground that the main contractor has already paid ..... X X X X Extracts X X X X X X X X Extracts X X X X
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