2018 (5) TMI 2195 - AT - Service Tax

Time-barred demand for CENVAT credit on employee medical services (2007-11) allowed; 2012 extension of limitation inapplicable

CESTAT (AT) held that the extended period of limitation could not be invoked where contrary precedents supported the appellant's entitlement to CENVAT ... CENVAT Credit - input services - medical claim services of the employees and their family members - period 2007-08 to 2010-11 - invocation of extended period of limitation - HELD THAT:- As there were contrary decision on the issue that appellant is entitled to avail Cenvat credit, in that circumstance, the extended period is not invokable. Admittedly, in this case, the show cause notice has been issued on 04.10.2012 which is beyond the period of limitation prescribed for invoking extended period of limitation and the whole of the demand is barred by limitation. Further, it is also noted that Section 73 of the Finance Act, 1994 was amended on 28.05.2012 wherein the time limit to issue the show cause notice is amended to 18 months instead of 12 months. Admittedly, the period involved is prior to 28.05.2012 and at the relevant time, the prescribed time limit was 12 months. In that circumstance, the amendment made in Section 73 of the Finance Act, 1994 is not applicable to the facts of this case. The whole of the demand is barred by limitation. Accordingly, the impugned order is set-aside and the appeal is allowed. The central issue is whether the appellant may avail Cenvat credit on medical claim services for employees and their families for 2007-08 to 2010-11. Noting contrary decisions favorable to the appellant, the Tribunal holds that 'extended period is not invokable.' The show-cause notice was issued on 04.10.2012, beyond the limitation period applicable at the relevant time; therefore 'the whole of the demand is barred by limitation.' The amendment to Section 73 of the Finance Act, 1994 (increasing the show-cause notice period to 18 months effective 28.05.2012) is inapplicable because the tax periods involved predate that amendment, when the prescribed time limit was 12 months. Consequently the impugned order is set aside and the appeal is allowed with consequential relief, if any.