2020 (3) TMI 917 - HC - Service Tax

High Court reviews time limits under Finance Act, challenges Tribunal decision

Commissioner Central Excise & Service Tax, Central Tax Delhi South Commissionerate Versus M/s. Dhillon Aviation Pvt. Limited

The High Court admitted the appeal to further consider the first issue regarding the time limitation under Section 73(1) of the Finance Act, challenging ... Supply of Tangible Goods Services - non-payment of Service Tax - appellant had been collecting Service Tax from its customers since 2008, but had not deposited the same with the Government Exchequer - demand alongwith interest and penalty - extended period of limitation - HELD THAT:- The appeal is admitted on substantial questions of law. Issue notice - List on 28.05.2020 in the category ‘After Notice Miscellaneous Matters’ for final disposal. Issues Involved:1. Interpretation of time limitation under Section 73(1) of the Finance Act.2. Exemption of demand based on sample invoices.3. Utilization of CENVAT credit for outstanding service tax demand.Analysis:1. The first issue raised in the appeal questions the justification of the Hon'ble Tribunal in dropping the demand prior to 23.10.2008, citing it as time-barred under Section 73(1) of the Finance Act. The appellant contests the Tribunal's decision, arguing that the demand was issued within the prescribed time frame. The High Court has admitted the appeal for further consideration, indicating the significance of this issue in determining the applicability of the time limitation provision.2. The second issue pertains to the justification of the Tribunal in dropping the second show-cause notice dated 24.4.2015 as time-barred. The appellant challenges this decision, claiming that the notice was issued within the stipulated time frame under Section 73(1) of the Finance Act. This issue raises questions about the correct interpretation of the statutory time limitation provisions and their application in the present case.3. The third issue revolves around the justification of the Tribunal in exempting a demand of Rs. 3,24,89,712 based on sample invoices. The appellant questions the validity of this exemption and seeks a review of the Tribunal's decision. This issue highlights the importance of proper documentation and evidence in tax-related matters, emphasizing the need for a thorough analysis of the facts presented before reaching a conclusion.4. The final issue concerns the Tribunal's decision to allow the outstanding service tax demand to be paid from the CENVAT credit without providing a clear finding on the eligibility or quantum of such credit. The appellant raises concerns about the basis for utilizing the CENVAT credit and requests a reconsideration of this aspect. This issue underscores the necessity of a detailed assessment of credit utilization and compliance with relevant regulations in tax matters to ensure transparency and fairness in the process.