Vijaya Advertisers vs Commissioner Of Central Excise on 6 January, 2006

Bench: S Peeran, J T T.K.

Vijaya Advertisers vs Commissioner Of Central Excise on 6/1/2006

ORDER

S.L. Peeran, Member (J)

1. This appeal arises from OIA No. 08/2004-ST dated 20-4-2004 confirming duty demands on larger period
besides confirming penalty. The contention of the appellant is that the demands are barred by time. They were
holders of registration and were paying Service tax on the services rendered by them as Advertising Agency.
They had paid tax upto November, December 1996 and could not pay the amount due to loss incurred by them
from April 1999 onwards. The Department did not initiate any action for recovery of the amount despite being
fully aware that the appellant had stopped paying the Service tax. The statement was recorded from the
Managing Partner, Shri Raju on 13-12-2000 and the Show Cause Notice was issued on 7-12-2001. The only
plea raised by the appellant is that the demands are hit by larger period. It was also contended that during the
relevant period, there was no provision for recovering duty of extended period and it was only during 2004,
the relevant section was amended for recovering the demands for larger period. It is further submitted that this
bench, in the appellant's own case, where he was a partner in Free Look Outdoor Advertising, the Tribunal, on
the same set of facts, set aside demands for larger period by Final Order No. 2249/2005, dated 23-12-2005
2006 (2) S.T.R. 102 (Tribunal) and remanded the case for working out duty for the period within six months.

2. The learned SDR opposes the prayer and contended that larger period was invokable as the appellants had
stopped paying duty and that itself is sufficient to take a view that larger period was invokable.

3. On a careful consideration, we notice that in an identical facts and circumstance, larger period has been set
aside in the case of Free Look Outdoor Advertising by Final Order No. 2249/2005 dated 23-12-2005. The
findings recorded in para 3 of the above Final Order is reproduced herein below:

3. On a careful consideration of the matter, I find that the statements were recorded from the Proprietor on
13-12-2000 and the Show Cause Notice has been issued on 7-12-2001. There is no invocation of larger period
in the Show Cause Notice. Therefore, the Department cannot enforce the demand for the larger period in the
absence of invoking the larger period in the Show Cause Notice and due to inordinate delay in issuing the
Show Cause Notice. Even on going through the Show Cause Notice, it is clear that the assessee had taken
licence and paid Service tax and filed returns for the initial period and thereafter due to loss in the business, he
failed to pay the Service tax. In these circumstances, the Department should have proceeded at the earliest to
recover the dues from him. In view of the plea on the time bar, the demand for the larger period is set aside.
The matter is remanded to the Original Authority to recalculate the demand arising within the time limit and
fix appropriate penalty accordingly. The Original Authority should complete the proceedings within a period
of four months from the date of receipt of this order, after providing an opportunity of hearing to the
appellants.

4. By applying the ratio of the above finding in the present case, we set aside the demand for the larger period
and remand the case to the original authority to re-work out the duty for six months period in terms of the
direction given in the above cited order. The matter shall be disposed of within four months from the receipt
of this order after providing an opportunity of hearing to the appellants.

(Operative portion of this Order was pronounced in open court on conclusion of hearing)

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