Transport service provider wins appeal on service tax limitation grounds

The appeal was filed challenging rejection based on limitation grounds by the Commissioner (Appeals). The appellant, a service provider in the goods transport agency sector, was alleged to have not paid service tax. The appeal, filed within the prescribed two-month period from the date of knowledge of the order, was deemed timely by the Tribunal. The Tribunal held that the findings on limitation were not sustainable, setting aside the order under challenge and remanding the matter for adjudication on the merits of the case.

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Issues:
1. Appeal against rejection based on limitation grounds.

Analysis:
The appeal was filed to challenge the rejection based on limitation by the Commissioner (Appeals) in Order-in-Appeal No231/2021. The appellant, a service provider in the goods transport agency sector, was alleged to have not paid service tax amounting to Rs.6,78,875/- on a taxable value of Rs.54,92,516/- for the Financial Year 2012-13. The proposal for recovery, along with interest and penalties, was confirmed vide Order-in-Original No. 2261-64 dated 26.04.2019, announced ex-parte. The appeal against this order was filed on 31.08.2020, beyond the stipulated period of two months for filing an appeal.

The main issue in the case was whether the appeal filed before the Commissioner (Appeals) was within the period of limitation as prescribed under Section 85 (3) of the Finance Act 1994. The provision states that an appeal must be presented within two months from the date of receipt of the decision or order of the adjudicating authority. The appellant claimed to have received communication about the Order-in-Original on 03.06.2020, and the appeal was filed on 31.08.2020, within the two-month period from the date of knowledge of the order.

The Tribunal observed that the relevant date for the period of two months to reckon was the date when the appellant had knowledge of the Order-in-Original, which was 03.06.2020. The appeal was filed within the stipulated period of two months from this date. The Department's document indicated the date of receipt of the order as 24.07.2020. Therefore, the appeal filed on 31.08.2020 was within the prescribed period. The Tribunal held that the findings on limitation in the order under challenge were not sustainable. The matter was remanded back to the Commissioner (Appeals) for adjudication on the merits of the case.

The order under challenge was set aside, and the appeal was allowed by way of remand for further proceedings on the merits of the case.

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