Section - 073 - Recovery of service tax not levied or paid or short-levied or short-paid or erroneously refunded

Yes. In the case of Maheshwari Woolens Mill [1992 (2) TMI 104 - SUPREME COURT OF INDIA], it was decided that notice refers to the period from November, 1983 to July, 1988 and that at least the period prior to 1-12-1983 is beyond the period of five years. This is no doubt true but the effect of this will not be to invalidate the notice in its entirety. At worst, the effect will be that the Department will not be entitled to collect the duty beyond a period of five years from the date of issue of notice. It will be open to the assessee to raise this plea in the course of the proceedings following on the issue of the show cause notice.

Same principle applies if show cause notice is issued for a period beyond 18 months. Refer case of Shahnaz Ayurvedics [2004 (1) TMI 94 - HIGH COURT OF JUDICATURE AT ALLAHABAD].

Limitation for recovery of service tax prevents collection for time barred periods but notice remains partly effective. A show cause notice that includes periods beyond the statutory limitation does not become wholly invalid; the Department cannot recover tax for time barred periods, and the assessee may raise the limitation defence during proceedings. The same rule applies to notices extending beyond a shorter statutory limitation-the excess period yields no departmental entitlement to recovery but does not vitiate valid allegations within the limitation.