Extended limitation requires proven intent to evade service tax; mere non-payment or registration failure cannot sustain recovery.

Extended limitation for service tax recovery requires findings and supporting material establishing fraud, collusion, wilful misstatement, suppression of facts, or deliberate contravention with intent to evade tax. Mere non-payment, negligence, or failure to obtain registration does not establish the requisite deliberate conduct. Where a substantial part of the original demand was dropped, the assessee's belief that service tax was not payable could be bona fide. In the absence of a finding of intentional suppression or evasion, the extended period was not invocable and the demand based on that period was unsustainable.

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Issues: Whether the extended period of limitation for recovery of service tax could be invoked.

Analysis: Invocation of the extended period under the proviso to Section 73(1) required findings and supporting material establishing fraud, collusion, wilful misstatement, suppression of facts, or deliberate contravention with intent to evade tax. The impugned order contained no finding that the non-payment was deliberate or attributable to suppression with such intent. Since a substantial part of the original demand had been dropped, the assessee's belief that service tax was not payable was bona fide. Mere non-payment, negligence, or failure to take registration does not by itself establish the positive and deliberate conduct necessary for the extended limitation period.

Conclusion: The extended period of limitation was not invocable; the demand founded on that period was unsustainable.

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