Extended limitation and reverse charge liability defeated the service tax demand where tax was already discharged by the recipient.

Extended limitation could not be invoked where the demand was based on information already available to Revenue from Form 26AS and no independent evidence of suppression was shown. Service tax demand also could not survive where the transportation service was covered by reverse charge under Notification No. 30/2012-S.T. and the recipient had produced proof of tax payment. On those facts, no separate liability remained against the service provider, and the penalty likewise failed.

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Issues: (i) whether the extended period of limitation could be invoked on the allegation of suppression of facts; (ii) whether service tax demand was sustainable where the service recipient had discharged tax under reverse charge mechanism.

Issue (i): whether the extended period of limitation could be invoked on the allegation of suppression of facts.

Analysis: The demand was founded on information already available from Form 26AS and the Revenue had access to the relevant source material during the period itself. No independent basis was shown for alleging suppression of facts, and the notice was issued beyond the normal period.

Conclusion: The extended period of limitation was not invokable.

Issue (ii): whether service tax demand was sustainable where the service recipient had discharged tax under reverse charge mechanism.

Analysis: The transportation activity was covered by reverse charge under Notification No. 30/2012-S.T. dated 20.06.2012, and the service recipient had produced proof of tax payment. In the absence of a sustainable basis for a separate demand against the service provider, the demand could not stand.

Conclusion: The service tax demand was not sustainable and penalty also could not survive.

Final Conclusion: The demand and penalty were held unsustainable, and the appeal succeeded with consequential relief.

Ratio Decidendi: A demand based only on departmental information already available to the Revenue, without proof of suppression or independent investigation, cannot justify invocation of the extended limitation period, and no separate tax demand survives where liability has already been discharged under the applicable reverse charge mechanism.

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