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TMI Blog2024 (7) TMI 758X X X X Extracts X X X X X X X X Extracts X X X X ..... nts, it is a settled legal position that the extended period of limitation cannot be invoked. Further, the assessee on facts had further stated that on and from 1st June, 2007 they have been paying service tax and earlier there was a doubt as regards the leviability of the service tax prior to 1st June, 2007, that too, by artificially bifurcating the composite services rendered by the assessee and therefore, the extended period of limitation cannot be invoked. That apart, the assessee had pointed out that they entered into contracts with reputed companies like TISCO Ltd. and ICML etc. and in the contracts which they have entered into with these listed companies there was no provision for service tax as there was no service tax on mining service during the material period. In UOI VERSUS INDIAN NATIONAL SHIPOWNERS ASS. ORS. [ 2010 (12) TMI 12 - SUPREME COURT] , the appeal was filed by the Union of India against a judgment of the High Court of Bombay quashing the notice issued by the appellant therein to the members of the Indian National Shipowners Association (respondents therein) by holding that the entry contained in Section 65 (105) (zzzy) of the Finance Act, 1994 does not includ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eciated by the Learned Tribunal or not? 2. We have heard Mr. K. K. Maity, learned Counsel appearing for the appellant and Mr. Satyaprem Majumder, learned Counsel for the respondent. 3. The issue which arises for consideration in this appeal which has been suggested by the revenue in the aforementioned three substantial questions of law is, whether the respondent/assessee was liable to pay service tax in respect of the services rendered by him which are essentially mining activities for the services/activities prior to 1st June, 2007. The other issue would be as to whether the Department could have invoked the extended period of limitation for issuing the show-cause notice and demanding service tax. The assessee had set out the factual background, namely, the nature of activities done by them, namely, the mining activity. It is the consistent case of the assessee that service tax in respect of mining activities was levied for the first time with effect from 1st June, 2007 and therefore they did not apply for registration in respect of mining services before 1st June, 2007. The assessee, therefore, contended that they were under the bonafide belief that the registration need not be t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hem up to the pithead:- These activities are essential integral processes and are part of mining operations. As stated earlier, mining activity has been made taxable by legislation under the Finance Act, 2007(w.e.f. 1.06.2007). Prior to this date, such activities, being part of mining operations itself are not subjected to service tax. Therefore, no service tax is leviable on such activities prior to the said date. 5. Thus, on facts that Tribunal has rightly appreciated the case of the assessee and granted relief with regard to invoking the extended period of limitation. We have seen the allegation in the show-cause notice and we find that except for the use of the words omission and failure , suppression of material facts , with an intent to evade payment of service tax , the adjudicating authority has not brought out any facts to substantiate as to how there was an act of omission and failure on the part of the assessee to disclose the correct facts and that it was with an intent to evade payment of service tax. 6. In the absence of these essential elements, it is a settled legal position that the extended period of limitation cannot be invoked. Further, the assessee on facts had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bject is free. The Hon ble Supreme Court held that since the Finance Act lays no charge or machinery to levy and assess service tax on indivisible composite contracts, the argument of the revenue must fail. 8. Further, it was pointed that this is also for a simple reason that there is no subterfuge in entering into composite works contract containing element both of transfer of property and goods as well as labour and service. 9. In Union of India vs. Indian National Shipowners Association reported in (2011) 11 STR 3 (SC), the appeal was filed by the Union of India against a judgment of the High Court of Bombay quashing the notice issued by the appellant therein to the members of the Indian National Shipowners Association (respondents therein) by holding that the entry contained in Section 65 (105) (zzzy) of the Finance Act, 1994 does not include service provided by the members of the association. The Union of India, appellant therein contended that such service which were provided by the members of the association, have by then, subjected to the payment of service tax by virtue of the amendment brought in Section 65 (105) by way of amendment in Finance Act, 1994 with effect from 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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