Service tax demand on consulting engineer services set aside due to limitation bar and procedural lapses

The CESTAT New Delhi allowed the appeal, setting aside the original order demanding service tax on consulting engineer services. The tribunal held that Cenvat credit was properly availed based on valid invoices, despite the department's objection regarding address discrepancy due to office relocation. The court ruled this was merely a procedural lapse and substantial benefit could not be denied on such grounds. The extended period of limitation was wrongly invoked as the appellant filed regular ST-3 returns and the department failed to prove suppression of facts with intent to evade tax. The demand was barred by limitation and the appellant was held not liable for the alleged service tax liability.

---

---

Issues Involved:
The issues involved in the judgment are:
1. Whether the appellant is liable to pay service tax on Consulting Engineer Services rendered by the appellant.
2. Whether the appellants have wrongly availed the Cenvat credit without support of input documents and, as such, the same is recoverable from the appellants.
3. Whether the extended period of limitation has wrongly been invoked while issuing the show cause notice.

Issue 1: Liability to Pay Service Tax
The appellant provided Consulting Engineering services in Jammu and Karnataka for the construction of roads. The service circular No. 14/2004 clarified that Service Tax is not applicable to services in Jammu and Kashmir. Mega Notification No. 25/2012 exempts certain services, including construction of roads for public use. The services provided by the appellants fall under this exemption, and thus, the service tax liability was held to be wrongly imposed based on findings from a previous order.

Issue 2: Cenvat Credit Availment
The appellant's invoices were deemed improper for availing Cenvat credit as the registered premises did not match the addresses on the invoices. However, it was clarified that as long as all required particulars are available on the documents, they are sufficient for Cenvat Credit availment. The appellant's shifting of office premises was a procedural lapse, not a case of fake registration. The Cenvat credit was deemed rightly availed based on the invoices submitted.

Issue 3: Extended Period of Limitation
The department invoked the extended period of limitation, alleging suppression of facts by the appellant. However, as the appellant was filing regular ST-3 returns, the extended period was held to have been wrongly invoked. The absence of evidence to support the allegation of suppression of facts led to the conclusion that the extended period was not justified.

In conclusion, the Tribunal found that the issues raised in the present appeal had already been decided in a previous Final Order in favor of the appellant. The appellant was held not liable for the alleged service tax liability, and the Cenvat Credit availed was deemed proportionate. The demand was considered time-barred, and the impugned order was set aside, leading to the allowance of the appeal.

---