Tribunal Overturns Service Tax Demand for 2012-14 Citing Revenue Neutrality and Limitation Period Issues.

The Tribunal set aside the impugned order, allowing the appeal with consequential relief. It held that the service tax demand for 2012-13 and 2013-14 was barred by limitation due to revenue neutrality. The appellant's failure to pay service tax on transportation services under the Reverse Charge Mechanism did not justify invoking the extended period of limitation.

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Issues involved: Appeal against confirmation of service tax demand invoking extended period of limitation.

Summary:
The appellant, engaged in providing Business Auxiliary Service and Goods Transport Agency Service, appealed against the confirmation of service tax demand for not paying due service tax during 2012-13 and 2013-14. The appellant argued that they had paid service tax on output services but not under Reverse Charge Mechanism (RCM) on transportation charges, leading to a revenue-neutral situation. Citing a precedent, the appellant contended that demand under RCM does not warrant extended period of limitation. The Revenue supported the impugned order. The Tribunal found that the appellant should have paid service tax on transportation services under RCM to claim cenvat credit, resulting in revenue neutrality. Relying on a previous ruling, the Tribunal held that the demand for the period in question was hit by limitation due to revenue neutrality, setting aside the impugned order and allowing the appeal with consequential relief.

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