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M/s NIIT Ltd Versus C.S.T., Delhi

2015 (9) TMI 1386 - CESTAT NEW DELHI

Commercial Training or Coaching Services - bonafide belief - extended period of limitation - Imposition of penalty and interest - Held that:- Something positive other than mere inaction or failure on the assessee's part or conscious withholding of information when assessee knew otherwise is required for invoking extended period. Although there was delay on the part of the appellant in providing information which may have led to delay in issuance of Show Cause Notice, the appellant has claimed th .....

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n of facts. - allegation of wilful suppression of facts is not sustainable. Similar view was also been held by CESTAT in the case of Gargi Consultants Pvt. Ltd. Vs. Commissioner [2013 (5) TMI 695 - CESTAT NEW DELHI]. As a consequence, the demand of ₹ 71,50,372/- is hit by time bar and hence the same is not sustainable

Regarding demand for normal period - Held that:- Even after the demand was confirmed and the issue no longer remained res integra, the appellant did not remit the .....

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i C S, Member (J) For the Appellant : Shri B L Narsimhan, Adv For the Respondent : Ms Suchitra Sharma, DR ORDER Per Mr. R K Singh Appeal has been filed against Order-in-Original dated 30.06.2008 in terms of which service demand of ₹ 33,38,829/- in respect of Show Cause Notice dated 25.04.2006 and ₹ 71,50,372/- in respect of Show Cause Notice dated 24.08.2007 were confirmed along with interest and penalties on the ground that the appellant had not paid the service tax under "Comm .....

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CN dated 24.08.2007 71,50,372.00 2. The appellant has contended that the issue of liability to tax under "Commercial Training or Coaching Service" on the service rendered by a computer institute is no longer res integra and decided against the appellant by the Supreme Court in the case of CCE Vs. Sunwin Technosolution P. Ltd. [2011 (21) STR 97 (SC)]. However, ld. advocate stated that Notification No.9/2003-ST, dated 20.06.2003 exempted the services rendered by the computer training ins .....

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commercial training or coaching by a computer training institute"; The ld. Advocate stated that after the introduction of the said proviso, it started paying service tax and prior to that date it was under bona fide belief that the training being provided by it fell within the scope of vocational training and therefore it was covered within the scope of vocational training institute and so it did not pay any service tax. He stated that this was a reasonable belief on its part and the same v .....

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it is also eligible for the benefit of Section 80 of the Finance Act. 3. Ld. Departmental Representative strenuously argued that there was suppression of facts and the appellant did not mention the value of the exempted service and exemption Notification in the ST-3 returns. It also did not provide the information timely when asked in spite of protracted correspondence and in respect of demand of ₹ 71,50,372/- it provided the information after more than two years from the date it was soug .....

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ra) and as conceded by the ld. advocate the appellant has no case on merit. However, it is a fact that the proviso to Notification No.24/2004-ST, dated 10.09.2004 was added only on 16.06.2005, which stated that "provided that nothing contained in this notification shall apply to the taxable services provided in relation to commercial training or coaching by a computer training institute". Indeed, CESTAT in the case of Commissioner Vs. Doon Institute of Information Tech P Ltd. (supra) h .....

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ing. The fact that even CESTAT held the same view and the same view was held by Uttarakhand High Court in the case of Doon Institute of Information Technology (supra) shows that the view held by the appellant was not unreasonable or hallucinatory. In these circumstances, the contention of the appellant that it was actually under a bona fide belief that the impugned service tax was exempted during the period prior to the insertion of the proviso in Notification No.24/2004-ST vide Notification No. .....

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as provided only in 2007 as a result of which the Show Cause Notice could not be issued earlier and thus the appellant is guilty of suppression of facts and so the extended period is invocable and the appellant cannot take advantage of time-bar having itself caused the delay in issuance of Show Cause Notice. Prima facie, there is force in this contention of Revenue In the case of Chemphar Drugs Linemants [2002-TIOL-266-SC-CX], the Supreme Court held that something positive other than mere inacti .....

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time-bar. The fact that Delhi data was supplied without delay further supports the view that delay in providing information about outside-Delhi centres was not intentional to evade service tax. However, for invoking the extended period what is required to be established is that there was wilful mis-statement/suppression of facts. So, one has to distinguish between wilful non-supply of information and mere delay in furnishing the information. It has been repeatedly held by the judicial pronounce .....

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