2021 (9) TMI 58 - AT - Service Tax

Security Agency Service - Manpower Supply services - Cleaning Service - applicability of Section 11D of Central Excise Act, 1944 and Section 73A of the Finance Act, 1994 - extended period of limitation - HELD THAT:- It is found from the Adjudication Order that the appellant was engaged in providing services related to Security, Manpower Supply for Cleaning, Washing, Sweeping, Gardening, Up keeping, Watch & Ward, Grass Cutting, Checking, Mechanised Cleaning, Driving, Office Assistance etc. They were registered with the Service Tax Department under the category of “Security Agency” which was introduced in the Service Tax net on 16.10.1998 vide Clause 94 of Section 65 of Chapter –V of Finance Act, 1994 as amended.

In the present case, the appellant in the statement during the investigation categorically stated that watch and ward service are for checking of tickets of the Metro Railways. But, no investigation was taken. Therefore, the Adjudicating authority passed the order on a conjecture that the appellant had also function not merely on watch and ward of checking tickets, which cannot be accepted.

Extended period of limitation - HELD THAT:- It is found fhe Adjudication Order that the Adjudicating authority had merely observed that the applicant is a very old Registered Firm and they have not discharged their service tax liability properly and therefore the extended period of limitation would be invoked. There is no material available on record to invoke the extended period of limitation. Apart from that, a part of demand is liable to be dropped on merit and therefore the extended period of limitation cannot be invoked for the balance amount. Hence, the balance amount of tax is liable to be set aside on limitation.

The expressions “every person who is liable to pay duty under this Act or Rules made thereunder, and has collected any amount in excess of the duty” in Section 11D of the Act make it clear that the said provision would be applicable where the person is liable to pay duty and collected any amount in-excess of the duty assessed. Apart from that Section 73A of the Finance Act, 1994 has been introduced with effect from 18.04.2006 and that according to Sub Section (2) of Section 73A, Service Tax collected on non-taxable service is demandable/payable to Government exchequer. The Learned Departmental Representative had not disputed the legal position - the present case is prior to insertion of Section 73A(2) of the Act 1994 and therefore the demand of the amount under Section 11D is not justified.

Appeal allowed - decided in favor of appellant.