Form 26AS-based service tax demand failed for want of corroboration and could not be saved by extended limitation.

Service tax demand based mainly on Form 26AS data was found unsustainable because it lacked independent verification and corroborative material establishing taxable service liability. The record showed that a substantial part of the demand had already been dropped on documentary evidence, which reinforced the finding that the notice was issued without proper investigation. In the absence of material showing suppression or any other ground justifying the extended limitation period, the demand was held time-barred and the extended period under section 73 of the Finance Act, 1994 was not invokable.

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Issues: Whether the service tax demand, founded substantially on Form 26AS data and invoked by applying the extended period of limitation under section 73 of the Finance Act, 1994, could be sustained.

Analysis: The demand was found to rest on Form 26AS without adequate independent verification or corroborative material to establish taxable service liability. The order noted that a substantial part of the demand had already been dropped on the basis of documentary evidence, reinforcing the conclusion that the notice had been issued without proper investigation. In the absence of material showing suppression or other grounds justifying invocation of the extended period, the demand could not be maintained on a time-barred basis.

Conclusion: The demand was held unsustainable on the ground of limitation, and the extended period was not invokable.

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