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2014 (8) TMI 516 - AT - Service TaxExtended period of limitation - Business Auxiliary service - Sale of warehoused goods to traders - Appellants while raising the invoices on the purchasers, split the price mentioned in the purchaser orders and issue a separate debit note towards such expenses incurred by the Appellants - Held that:- Notice is issued on 18-4-2013 and demands service tax for the period 1-10-2007 to 5-1-2012. The same is therefore beyond the normal period of limitation of eighteen months prescribed in Section 73(1) of the Finance Act 1994 - Appellants records have been subjected to scrutiny by the department from time to time. It is not in dispute that as many as four audits have been conducted by the department covering the period 1-10-2007 to 5-1-2012. There is no scope for invoking the larger period of limitation. The DGCEI having examined the documents and ascertained the facts and having come to the conclusion that there was no case for demand of service tax and having ordered closure of the inquiry in the year 2010, it cannot be held that there was cause for invoking the larger period of limitation by issuing a Notice in the year 2013. Where the documents were examined and a view was formed in 2010 that there is no case for demanding service tax and accordingly closure of inquiry was ordered, merely because the authorities subsequently change their view that does not justify invoking the larger period of limitation. It has been consistently held that a subsequent change of view by the authorities would not justify invoking the larger period of limitation. Commissioner while dealing with the issue of larger period of limitation, has completely ignored the fact that apart from the Appellants records being audited by the department on as many as four occasions, the DGCEI itself had after examining the documents arrived at a conclusion that service tax was not payable and ordered closure of the inquiry. There is no basis for the Commissioner s finding that the Appellants were aware that the expenses recovered under the debit notes from the traders-purchasers were liable to service tax under Business auxiliary service. Merely because after commencement of the DGCEI inquiry in November 2009, the Appellants started paying service tax in respect of such debit notes from December 2009 would not in itself be a justification for invoking the larger period of limitation particularly when after such inquiry the DGCEI itself ordered closure of the inquiry in August 2010. In the circumstances the larger period of limitation is not applicable in the present case and on this ground itself the impugned order is liable to be set aside. - Decided in favour of assessee.
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