TaxTMI 
TaxTMI 
2015 (9) TMI 787
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....t and Equipment' services to various clients. During the course of audit of the records of the appellants, it was observed that they had rendered services of 'Installation Commissioning of Plant and Equipment' but had not obtained registration and not paid service tax on the value of services rendered. It was further seen that the appellants obtained registration in February 2005 and had themselves changed service tax on invoices raised during the period from November 2004 to February 2005, only to those clients who agreed to pay service tax. This shows that the appellants were aware of their tax liability, but suppressed the facts from the department with intent to evade payment of service tax. The tax liability worked out by the A....
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....d the entire service liability and filed the returns to the authority. It is his submission that subsequent audit which took place in 2008 for the period in question, to demand were raised by authorities, based on the audit report filed by the auditors, by invoking extended period. 5. He would submit that the entire tax liability and interest thereof are deposited, returns thereof filed with the lower authorities, second audit report could not have invoked the extended period. He would placed reliance on the Judgment of Hon'ble High Court of Karnataka in the case of MTR Foods Ltd. 2012 (282) E.L.T. 196. 6. Learned Departmental Representative would submit that the extended period has been correctly invoked as the appellant collected th....
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....46/2008-09 came to conclusion that there was short payment of duty with intention to evade Service Tax. The show cause notice in the case hand was issued based upon the 2 nd audit report. 10. In our view the entire demand is to be set aside on the ground on limitation only. Revenue authority cannot invoke the extended period of limitation, when the records of the assessee were audited by the officers once but did not find any short payment from records. The 2nd audit party, doing the audit of same period or over lapping period, cannot allege that appellant has miss-stated (sic) or suppressed the facts from the departments. We find that the Hon'ble High Court of Bombay in the case of Rajkumar Forge Ltd. 2010 (262) E.L.T. 155 (Bom.) held....
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....he correspondence that is addressed by the Petitioners to the Respondents, it cannot be said that the Petitioners have misstated the facts or there is a fraud practiced by the Petitioners." 11. The above said views are also relied on by the Hon'ble High Court of Karnataka in the case of MTR Foods ltd. (supra). We reproduce the relevant paragraph:- "4. As is clear from the material on record, the returns were filed promptly. In the returns it is clearly mentioned that they availed credit under the aforesaid rules. The audit party accepted the same. It is only in the second audit that they noticed the mistake and initiated proceedings. Therefore, in the light of the aforesaid facts none of the other conditions prescribed in the Proviso....