Extended limitation for service tax demands requires proof of suppression or intent to evade, not mere non-payment.

Service tax demand on electrification work forming part of a civil court building was held unsustainable because the extended period of limitation could not be invoked. The record did not establish suppression of facts, fraud, misstatement, or intent to evade tax, and mere non-payment was insufficient to justify the longer limitation period. As the show cause notice was issued beyond the normal period without the required mens rea, the demand failed on limitation and the appellant was granted relief with consequential benefits as available in law.

---

---

Issues: (i) Whether the demand of service tax on the appellant's electrification work was justified under Erection, Commissioning or Installation Service; (ii) Whether the conditions for invoking the extended period of limitation were satisfied.

Issue (i): Whether the demand of service tax on the appellant's electrification work was justified under Erection, Commissioning or Installation Service.

Analysis: The appellant's work was an identified sub-work of electrification forming part of the construction of a civil court building. The dispute on merits was considered along with the departmental circular relied on by the appellant, but the decision turned on the limitation issue. Since the demand itself was held to be unsustainable on limitation, the merits of classification did not result in an independent sustainable demand.

Conclusion: The demand was not sustained against the appellant.

Issue (ii): Whether the conditions for invoking the extended period of limitation were satisfied.

Analysis: The first communication indicating tax liability was issued on 21.02.2007, whereas the show cause notice was issued only on 22.10.2012, well beyond the normal period. The record did not establish suppression of facts, fraud, misstatement, or any intent to evade tax. Mere non-payment, without proof of the necessary mens rea, was held insufficient to justify invocation of the extended period. The allegation of non-compliance was therefore found inadequate to sustain the time-barred demand.

Conclusion: The extended period of limitation was not validly invoked.

Final Conclusion: The demand failed on limitation, and the appellant obtained relief from the confirmed tax demand with consequential benefits as available in law.

Ratio Decidendi: Invocation of the extended period of limitation requires proof of suppression of facts, fraud, misstatement, or intent to evade tax, and a demand cannot be sustained on mere non-payment or non-voluntary compliance without such proof.

---