Case Law Details
SOTC Travels Services Pvt. Ltd. Vs Principal Commissioner of Central Excise (CESTAT Delhi)
Conclusion: Assessee was able to correlate the invoices with the undertakings and satisfied the substantial conditions set out in the Exemption Notifications. The extended period of limitation could not be invoked in absence of “suppression‟ or “collusion” with an intent to evade payment of duty. Accordingly, the order was set-aside by which the demand of service tax had been confirmed with interest and penalty.
Held: Assessee was rendering air travel agent services to the Embassy of the United States of America. It claimed that it was the sole and exclusive service provider for the US Embassy and operated from a desk set up within the premises of the US Embassy. On such services, assessee was availing exemption from payment of service tax in terms of Notification dated 23.05.2007 till 30.06.2012 and, thereafter, under Notification dated 20.06.2012. These Notifications exempted services rendered to diplomatic mission or consular posts in India from payment of service tax. In 2014, an investigation was initiated and audit of the records of assessee was conducted in terms of rule 5A of the Service Tax Rules, 1994. During the audit, it was observed that assessee-company was incorrectly availing exemption on services rendered to the US Embassy. Principal Commissioner passed the impugned order denying the exemption to assessee and confirming the demand of service tax with penalty. It was held that assessee was able to correlate the invoices with the undertakings and satisfied the substantial conditions set out in the Exemption Notifications. Even for the subsequent period, assessee continued to provide such services to the US Embassy and the exemption had been allowed. Moreover, even when an assessee had suppressed facts, the extended period of limitation could be invoked only when “suppression‟ or “collusion” was wilful with an intent to evade payment of duty. The invocation of the extended period of limitation, therefore, could not be sustained. Accordingly, the order was set-aside by which the demand of service tax had been confirmed with interest and penalty.
FULL TEXT OF THE CESTAT DELHI ORDER
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