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2020 (5) TMI 344 - AT - Service TaxNon-payment of service tax - non-filing of ST-3 Returns - services to ZEC as a sub-contractor - period of dispute is from 1 April, 2007 upto 30 June, 2013 - recovery alongwith interest and penalty - extended period of limitation - whether the Appellant had submitted a reply to the Show Cause Notice? - HELD THAT:- The impugned order is dated 24 July, 2014. It appears that the reply submitted in the office could not be placed before the Commissioner at the time the order was passed. The matter on merits as to whether a sub contractor is liable to pay service tax on the activity undertaken by a sub-contractor in pursuance of a contract has been decided by a Larger Bench of the Tribunal in COMMISSIONER OF SERVICE TAX VERSUS MELANGE DEVELOPERS PVT. LTD. [2019 (6) TMI 518 - CESTAT NEW DELHI] in favour of the Department. Invocation of Extended Period of Limitation - HELD THAT:- The audit of records of Appellant for the period September, 2006 to March, 2010 was conducted by the Internal Audit of the Department on 13 and 14 September, 2010 and an Internal Audit Report was issued on 14 December, 2010 incorporating audit paragraphs relating to non payment of service tax. The Show Cause Notice was, however, issued on 18 April, 2013 after period of two years and four months of the issuance of the Internal Audit Report. It cannot, therefore, be said that the facts had been suppressed with intention to avoid payment of tax. The Mumbai Bench of the Tribunal in GAMMON INDIA LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, GOA [1999 (5) TMI 436 - CEGAT, MUMBAI] dealt with this issue and observed that where a Show Cause Notice was issued in September, 1989 even though the Appellant therein had supplied information to the Department in August, 1987, the notice was barred by limitation. The Civil Appeal filed by the Department before the Supreme Court was dismissed on 1 May, 2002 - In the instant case, the Department kept quiet for over two years and four months before issuing of the Show Cause Notice. Thus, the Department was not justified in invoking the extended period of limitation. The demand of service tax, imposition of penalty and interest for any period beyond the period of one year prescribed under Section 73 of the Act, therefore, cannot be sustained - the matter needs to be remitted to the Commissioner to determine the service tax liability and the imposition of penalty and interest if any, within the normal period prescribed at the relevant time - Appeal allowed by way of remand.
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