Extended period of demand not invokable if no mala-fide intention or suppression of fact by assessee

Patel Labour Contractor P Ltd Vs C.S.T. Service Tax (CESTAT Ahmedabad)

It is settled that if on any issue there is a legal dispute which involved interpretation of law the mala-fide intention or suppression of fact with intent to evade payment of service tax cannot be attributed to the assessee. On this ground also the extended period of demand was not invokable.

As per the facts in the present case the period of dispute i.e. 2005-06 to 2009-10 and show cause notice was issued on 19.05.2011. It is also observed that the appellant has filed their ST-3 return covering the period October 2009 to March 2009 on 27.04.2010. As per the aforesaid facts the entire demand is beyond the normal period and falling under the extended period of As per the above discussion and findings which is supported by the various judgments on limitation. The entire demand is time barred.

FULL TEXT OF THE CESTAT AHMEDABAD ORDER

The brief facts of the case are that the appellants were engaged in supply of manpower to various industrial organizations as per the arrangements with the service recipients. The appellants would charge 10% of the actual wages to be paid to the workers so hired/supplied as their service charges. The appellants have recovered the wages/salary to be paid to the manpower supplied by them from the service recipient and paid to the man power. The appellants have treated the wages/ salary as reimbursable expenses. The appellants have discharged the service tax on the aforesaid 10% service charges.

Please become a Premium member. If you are already a Premium member, login here to access the full content.