Negative list and exemption relief barred service tax demand, while absence of suppression defeated extended limitation.

Services rendered to educational institutions were treated as falling within the negative list, and security services to those institutions were also covered by the applicable exemption notification; services supplied to a body corporate were, if taxable at all, liable under reverse charge in the recipient's hands. On that basis, the service tax demand was unsustainable. The extended limitation period was also unavailable because the appellant was registered, filed returns regularly, maintained records, and the department relied on public income tax data rather than concealed material, so suppression of facts was not established. The demand, including consequential interest and penalties, could not be sustained.

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Issues: (i) Whether the services provided to educational institutions and a body corporate attracted service tax, or were covered by the negative list, exemption notification, or reverse charge mechanism; (ii) Whether the demand was barred by limitation for want of suppression of facts.

Issue (i): Whether the services provided to educational institutions and a body corporate attracted service tax, or were covered by the negative list, exemption notification, or reverse charge mechanism.

Analysis: The demand was founded on figures reflected in income tax data. The services rendered to educational institutions fell within the negative list for education-related services. Security services provided to educational institutions were also exempt under the applicable exemption notification. Services supplied to a body corporate were liable, if at all, under reverse charge in the hands of the recipient. On these facts, the appellant was not liable to discharge service tax on the activities in question.

Conclusion: The demand of service tax on the said services was unsustainable.

Issue (ii): Whether the demand was barred by limitation for want of suppression of facts.

Analysis: The appellant was registered, filed returns regularly, maintained records, and the department relied on public income tax data rather than concealed material. In these circumstances, no suppression attributable to the appellant was established, and the extended period could not be invoked.

Conclusion: The demand was barred by limitation.

Final Conclusion: The service tax demand, along with the consequential interest and penalties, could not be sustained, and the appellant obtained full relief.

Ratio Decidendi: Where the assessee's services are covered by the negative list or exemption and the department fails to establish suppression of facts, a service tax demand based on public third-party data cannot be sustained, nor can the extended limitation period be invoked.

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