Custom, Excise & Service Tax Tribunal
M/S. Dewsoft Overseas Pvt. Ltd vs Commissioner Of Service Tax on 2 August, 2016
IN THE CUSTOMS, EXCISE AND SERVICE TAX
APPELLATE TRIBUNAL, NEW DELHI
PRINCIPAL BENCH, COURT NO. IV
Service Tax ROM Application No. 50680 of 2016
Service Tax Appeal No. 504 of 2009
[Arising out of Order-In-Original No. 24/VKG/CST/2009 dated 19.3.2009 passed by Commissioner of Service Tax, New Delhi]
For approval and signature:
Hon'ble Ms. Archana Wadhwa, Member (Judicial)
Hon'ble Mr. R K Singh, Member (Technical)
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Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
No
2
Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
Yes
3
Whether Their Lordships wish to see the fair copy of the Order?
Seen
4
Whether Order is to be circulated to the Departmental authorities?
Yes
M/s. Dewsoft Overseas Pvt. Ltd. Appellant
Vs.
Commissioner of Service Tax Respondent
New Delhi Appearance:
Shri B L Narasimhan, Advocate for the Appellants Shri Ranjan Khanna, AR for the Respondent CORAM:
Hon'ble Ms Archana Wadhwa, Member (Judicial) Hon'ble Mr. R K Singh, Member (Technical) Date of Hearing/ Decision: 02.08.2016 FINAL ORDER NO . 52898 /2016 Per Archana Wadhwa (for the Bench):
The present Misc application stand filed for rectification of mistake having occurred in Final Order No. ST/53952/2015-CU (DB) dated 29.10.15 vide which the appellants appeal was rejected on merits by following the Larger Bench decision of the Tribunal in the case of Great Lakes Institute of Management Ltd. vs. CST, Chennai reported as [2013 (32) STR 305]. It is seen that the appellant was also one of the parties before the Larger Bench decision of the Tribunal. The issue involved is as to whether online educational service being provided by the appellant would be taxable under the category Commercial training or coaching service or not. The Larger Bench of the Tribunal has held such services to be taxable under the category of Commercial training or coaching service and the appeals were remitted to the regular Benches for decision.
2. When the appeal was heard by regular Bench, vide its order dated 29.10.2015, the same was rejected on merits by following the Larger Bench decision in the case of Great Lakes Institute of Management Ltd.
3. The appellants grievance is that apart from the merits of the case, the demand was also assailed on the point of limitation. The limitation issue was raised before the Tribunal on various dates of hearing when the matter was heard even prior to the reference to the Larger Bench and it has been the consistent stand of the appellant that demand was hopelessly barred by limitation. Our attention stand drawn to the synopsis placed on record wherein the submissions as regards the time bar issue were made. However, there is no order of the Tribunal, while disposing of the assessees appeal, on the issue of demand being barred by limitation.
4. Learned advocate Shri B L Narasimhan appearing for the appellants has drawn our attention to various decisions of the High Courts laying down that if limitation aspect was raised but was not considered by the Bench, the same amounts to mistake on the part of the Court, requiring rectification.
5. We note that the Honble Gujarat High Court in the case of CCE, Valsad vs. Atul Ltd. [2016 (332) ELT 97 (Guj)] has held that assessees contention of demand being barred by limitation, left out for consideration in deciding the appeal against him on merits, falls within the scope of rectification. To the same effect is decision of the Tribunal in the case of Atul Products Ltd. vs. CCE&ST, Surat [2016 (332) ELT 121 (Tri-Ahmd]) holding that if the assessees stand on limitation does not stand considered by the Tribunal, the same amounts to a mistake apparent from the records requiring rectification. The Honble Bombay High Court in the case of CCE, Mumbai vs. NTB International Pvt. Ltd. [2014 (302) ELT 481 (Bom]) has also held to the same effect that issue of limitation having been raised, and not considered while passing the Final Order amounts to a mistake, thus falling within the provisions of Section 35 C (2) of the Central Excise Act, 1994, requiring rectification. The Honble Supreme Court in the case of Honda Siel Power Products Ltd. vs Commissioner of Income Tax, New Delhi [2008 (221) ELT 11 (SC]) has observed that if prejudice had resulted to the party, which prejudice is attributable to the Tribunals mistake, error or omission and which error is a manifest error, then the Tribunal would be justified in rectifying this mistake.
6. Having gone through the said final order of the Tribunal, passed in the appellants case, we find that the appeal stand decided on merits and there is no reference or discussion or finding on the point of limitation. Further, on going through the appeal memo as also the synopsis submitted by the appellant, during the course of hearing, before the Tribunal, it is seen that the plea of limitation was specifically raised. Inasmuch as the same does not stand considered by the Tribunal, we are of the view that same amounts to a mistake on the part of the Tribunal, in view of various decisions, as discussed above. Accordingly, we allow the ROM application and rectify the said mistake and proceed to decide the issue on limitation.
7. The period involved in the present appeal is from 1.7.2004 to 9.9.2004 and from 16.5.2005 to 31.3.2007 whereas the show cause notice stand issued on 10.7.2008 that is by invoking the longer period of limitation. It is seen that prior to present show cause notice, the applicants were earlier served with a show cause notice dated 24.8.2004, raising demand of duty for the period 2001 2003 by classifying the appellants services under the category of online information and data base access or retrieval services. The dispute in the earlier matter travelled up to the Tribunal and vide its Order dated 25.8.2008 reported as [2008 (12) STR 730 (Tri-Del)], the said services were held as not taxable in online information and data base access or retrieval services but under Commercial Training and Coaching services which was exempted during the relevant period. In the present show cause notice also, the demand was proposed under online information and data base access or retrieval services but Commissioner vide its impugned order has confirmed the tax under Commercial Training and Coaching services.
8. It is seen that a search was conducted in the appellants premises on 6.10.03 and on the same basis, the earlier show cause notice was issued on 24.8.2004. As such, it can be safely concluded that Revenue was aware of entire activity/ service of the appellant company provided by them, in which case no allegation of suppression or mis-statement with an intent to evade payment of service tax can be attributable to the assessee. When the earlier show cause notice was issued on 24.8.2004 involving the same activities, it is not understood as to why there is delay for issuing present show cause notice dated 10.7.2008 in respect of same activities. The Honble Supreme Court in the case of Nizam Sugar Factory vs. CCE [2006 (197) ELT 465 (SC)] has held that where the first show cause notice stand issued, the second show cause notice cannot be issued in respect of the same set of allegations, by invoking the longer period of limitation. As such, we are of the view that extended period would not be available to the Revenue for raising the demand. The limitation aspect can be viewed from another angle. Admittedly, during the relevant period, there was disputes going on for the correct classification of appellants activity. As there were contra decisions by the Tribunal, the matter was ultimately placed before the Larger Bench, which ruled against the assessee. In such a scenario, the question as to whether any malafide can be attributed to the assessee or not stand answered by various decisions by the Higher Courts. The Honble Supreme Court in the case of Continental Joint Venture has observed that there are varying, different views held during the relevant period, and the issue is finally decided by a Larger Bench, the assessee cannot be held guilty for any malafide or mis-statement with an intent to evade payment of duty. In the present case, when the Revenue itself was not clear about the classification of the appellants activity and infact proposed the classification, in the show cause notice under the category of online information and data base access or retrieval service. Inasmuch as the issue was not free from doubt and was not settled, any malafide cannot be attributed to the assessee, so as to invoke the longer period of limitation. Accordingly, we hold that the demand having being raised by invoking the extended period, is not justifiable. For the same reason, the penalty imposed upon the appellant would not stand. Accordingly, the impugned order is set aside and appeal is allowed on the point of limitation.
9. ROM application stand disposed of in the above manner.
(pronounced in the open court )
( Archana Wadhwa ) Member(Judicial)
( R K Singh )
Member(Technical)
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