Appellant's liability for service tax upheld, exception for GTA services. Appeal partially allowed.

The appellant is liable to pay the full service tax for the extended period along with interest and is also liable for a penalty under section 78 of the Finance Act, 1994, except for the service tax on Goods Transport Agency (GTA) services. The appeal is partially allowed by setting aside the demand of service tax under GTA along with corresponding interest and penalty. The remaining part of the Order-in-Appeal is upheld.

---

---

Issues Involved:
1. Raising additional issue not mentioned in the memorandum of appeal.
2. Liability to pay service tax on Goods Transport Agency (GTA) services.
3. Liability to pay interest on service tax.
4. Suppression of facts and evasion of tax.
5. Liability to pay penalty under section 78 of the Finance Act, 1994.

Detailed Analysis:

1. Raising Additional Issue Not Mentioned in the Memorandum of Appeal:
The appellant raised an additional issue during the hearing that they were not liable to pay service tax on GTA services, which was not mentioned in the memorandum of appeal. According to Rule 10 of CESTAT (Procedure) Rules, the Tribunal can consider grounds not set forth in the memorandum of appeal if sufficient opportunity is given to the affected party to contest it. The Tribunal found that the service tax on GTA services forms a component of the total demand and has a direct bearing on the interest and penalty. The Principal Bench of the Tribunal had previously excluded the act of merely hiring trucks to transport goods from the definition of GTA. The Tribunal allowed the additional ground to be taken up by the appellant.

2. Liability to Pay Service Tax on Goods Transport Agency (GTA) Services:
The Tribunal examined whether the appellant was liable to pay service tax on GTA services. The appellant argued that they only hired trucks to transport goods, which does not attract service tax as per the Principal Bench's judgment in Nandganj Sihori Sugar Co. Ltd. vs. CCE, Lucknow. The Tribunal agreed that the ratio of this judgment applies to the appellant's case, concluding that the appellant is not liable to pay service tax on GTA services.

3. Liability to Pay Interest on Service Tax:
The appellant did not dispute that they had not paid the service tax in time and had paid interest on some services when pointed out by the audit. The Tribunal found no dispute regarding the appellant's liability to pay interest on the service tax as applicable.

4. Suppression of Facts and Evasion of Tax:
The Tribunal considered whether the appellant suppressed facts and evaded tax. Section 73 of the Finance Act permits invoking an extended period of demand where there is fraud, collusion, wilful misstatement, suppression of facts, or contravention of provisions with intent to evade payment of service tax. The appellant filed ST-3 returns without disclosing the full value of services rendered and the service tax payable. As the appellant was already registered with the Service Tax Department, they were expected to disclose the full value of services rendered. The Tribunal found that the appellant suppressed facts, justifying the invocation of the extended period of demand.

5. Liability to Pay Penalty Under Section 78 of the Finance Act, 1994:
The Tribunal examined the imposition of penalties under section 78 of the Finance Act, 1994. Given that the appellant suppressed facts and evaded tax, the Tribunal found that the penalty under section 78 was imposable. However, the demand of service tax under GTA, along with corresponding interest and penalty, was set aside.

Conclusion:
The appellant is liable to pay the full service tax for the extended period along with interest and is also liable for a penalty under section 78 of the Finance Act, 1994, except for the service tax on GTA services. The appeal is partially allowed by setting aside the demand of service tax under GTA along with corresponding interest and penalty. The remaining part of the Order-in-Appeal is upheld.

---