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2023 (12) TMI 9 - AT - Service TaxClassification of service - transportation of passengers by air service or supply of tangible goods service - appellant is engaged in chartering of its Aircraft and is charging the customers for the same on hourly basis referred to as flying hours - extended period of limitation - HELD THAT:- The issue has acknowledged to be no more res-integra and to have been decided in the terms that the services in the given circumstances are classifiable, as “Supply of Tangible Goods Services” which are in tax net since 16.05.2008. Admittedly, the appellant was not discharging its liability since 16.05.2008. However, w.e.f. 01.07.2010 the tax liability has regularly been discharged however considering the impugned services as that of transportation of passengers by air. Simultaneously, it is observed that in the light of the EIH LIMITED VERSUS C.C.E., DELHI-I [2018 (9) TMI 921 - CESTAT NEW DELHI], the appellant was liable to pay the service tax w.e.f. 16.05.2008 but the said demand has been raised vide the Show Cause Notice dated 18.06.2013 i.e. by invoking the extended period of limitation. It is the case of the appellant that they were under the bonafide belief that the services rendered by them are “transportation of passengers by air service” which was not taxable prior to 01.07.2010. It is also very much apparent that beyond this date the appellants are regularly discharging their service tax liability. Hence, there are no reason to reject the stand taken by the appellants of having a bonafide belief. Nothing is produced by the Department to prove the malafide intent on part of the appellant to evade the tax liability. The mere allegation will not be sufficient for the Department to invoke the extended period of limitation - Extended period is, therefore, held to have been wrongly invoked. Once there was no malafide intent, the question of imposition of penalty does not at all arise. The appellant rather is held entitled to the benefit of Section 80 of the Act. The services in question are held to be ‘Supply of Tangible Goods Services’. However Show Cause Notice is held as time barred. Entire demand gets hit by limitation. Hence the order under challenge is hereby set aside - Appeal allowed.
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