TaxTMI 
TaxTMI 
2026 (8) TMI 1513
X X X X Extracts X X X X
X X X X Extracts X X X X
....the Finance Act, 1994 (Act) along with appropriate interest and imposed an equivalent penalty under Section 78 of the Act. 2. Relevant facts, as gleaned from the appeal records, are that the appellant is a 100% EOU having central excise and service tax registration engaged in providing 'Transcription Service' to Doctors in USA. Some of the Doctors in USA who use appellants' Transcription Service, record their dictation over phone into the server of Ecostentel, a 'dial and Dictate' recording Company in USA by bearing the cost on their own to make dictation faster and easier. Other doctors who have made such recording request the appellant to make the remittance to Ecostentel and collect the recordings to carry out the transcription work. The appellant in turn collects these charges including it in their 'Transcription charges' from their clients in USA. The Department was of the view that since these recordings reach appellants' Server in India from M/s Ecostentel Server via Internet and can be accessed only after making remittance to M/s. Ecostentel on behalf of the Doctors who had requested the appellant to make such payment, Ecostentel is providing a service as a service provi....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ider holds a licence under the Indian Telegraph Act. It is argued that therefore the service falls outside the tax net. Reliance is placed on the Central Board of Excise and Customs clarification vide Circular F.No. 137/21/2011-ST dated 19.12.2011. 6. Shri M. Selvakumar, Ld. Authorised Representative appearing on behalf of the Respondent reiterated the findings in the impugned order. 7. We have heard both sides and perused the materials available on record. 8. The issues that arise for our determination are: A. Whether the Demand is wholly barred by limitation as contended by the Appellant? B. If the demand is not barred by limitation, then on merits whether the demand confirmed along with applicable interest and imposition of penalty is tenable? 9. The appellant has contested the demand strenuously urging that the demand is wholly barred by limitation. When a plea that the demand is wholly barred by limitation is raised at the outset, we too find it appropriate to deal with the said contention at first. The question of limitation goes to the root of the matter and involves a question of jurisdiction to raise the demand itself in the first instance. Th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e Finance Act stipulates that where any service tax has not been levied or paid by reason of fraud or collusion or wilful mis-statement or suppression of facts or contravention of any of the provisions of the Chapter or the Rules made there under with intent to evade payment of service tax, by the person chargeable with the service tax, the provisions of the said section shall have effect as if, for the word "eighteen months", the word "five years" has been substituted. 13. The "relevant date‟ has been defined in section 73 (6) of the Finance Act as follows: "73 (6) For the purposes of this section, "relevant date" means, - (i) in the case of taxable service in respect of which service tax has not been levied or paid or has been short-levied or short-paid- (a) where under the rules made under this Chapter, a periodical return, showing particulars of service tax paid during the period to which the said return relates, is to be filed by an assessee, the date on which such return is so filed; (b) where no periodical return as aforesaid is filed, the last date on which such return is to be filed under the said rules; (c) in any othe....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d between the Appellant and the purported service provider. We further notice that the SCN also has not let in any evidence of any positive act of fraud, suppression or wilful misstatement of facts with intent to evade payment of duty on the part of the Appellant and is thus bereft of reasons justifying the invoking of the extended period of limitation. 17. Therefore, we find merits in the appellant's contest of the demand being barred by limitation. The Revenue has failed to adduce any evidence or establish that the respondent engaged in wilful or deliberate suppression of material facts, and there is nothing on record to suggest that the appellant acted with any intention to mislead the authorities or evade payment of service tax. Decisions abound, and a reference to the Judgements of the Apex Court in CCE v. H.M.M. Ltd, 1995 (76) ELT 497, Pushpam Pharmaceuticals Company v CCE, Bombay, 1995 (78) ELT 401 (SC), Stemcyte India Therapeutics Ltd v. CCE & ST, Ahmedabad III, 2025 (394) ELT 3 (SC), Uniworth Textiles v CCE, Raipur, 2013 (288) ELT 161 (SC) and the Delhi High Court decision in Bharat Hotels Ltd v. Commissioner of Chex (Adjudication), 2018 (12) GSTL 368 (Del.) would amply....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ing. In other words, it is the duty of the consumer forum to take notice of Section 24A and give effect to it. If the complaint is barred by time and yet, the consumer forum decides the complaint on merits, the forum would be committing an illegality and, therefore, the aggrieved party would be entitled to have such order set aside." 24. Consequently, since the Tribunal was justified, as we have held, in coming to the conclusion that the demand was time barred, there was no occasion for the Tribunal to enter upon the merits of the dispute. We, accordingly, answer the question of law as framed by the assessee in the affirmative and in favour of the assessee. 25. The appeal by the assessee shall stand disposed of in the aforesaid terms." (Emphasis supplied) 19. We also find that the Honourable Supreme Court in Commissioner of Customs, Mumbai v B.V. Jewels, 2004 (172) ELT 3 (SC), has observed that " If, in reality, the CEGAT found that the action taken by the departmental authorities was beyond the period of limitation, it could have disposed of the appeals before it only on that ground without examining the merits". This decision of the Apex ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Service Tax v. M/s. Monsanto Manufacturer Pvt. Ltd., reported in 2014-TIOL-550HC-ALL-ST, answered the question of law in favour of the assessee. 13. Judgment of the Supreme in State Bank of India's case (cited supra), followed in Commissioner of Customs's case (cited supra), squarely applies to the facts on hand, wherein, CESTAT, Madras, while dismissing the appeal as time-barred, has entered into the merits of the case and dismissed the same, on merits. In the words of the Hon'ble Supreme Court, that would be an illegality. 14. Though Mr. A.P. Srinivas, learned counsel appearing for the Revenue submitted that the correctness of the order impugned before us, can be decided in an appeal before the CESTAT and prayed to sustain the order, dated 15-2-2016 in W.P. No. 5501 of 2016, in the light of the above discussion and the decision in State Bank of India's case (cited supra), we are not inclined to accept the said contention. When the Hon'ble Supreme Court has described the manner of disposal of an appeal, as illegality, the same can be corrected by this Court, in exercise of the powers under Article 226 of the Constitution of India and no useful purpose would be s....