FACTS: The appellant, being a registered service provider, was engaged in providing services of Security Agency. During the scrutiny of the of the records maintained by the appellant it was found that there was a difference in amounts shown in Profit & Loss Account and ST-3 returns. A show cause notice was issued by Department demanding the required tax to be paid along with the interest & penalties invoking extended period of Limitation for suppression of information for evasion of duty. Without disputing the difference reflected in Profit & Loss Account and ST-3 returns, the appellant filed an appeal on the ground of the Show Cause Notice (SCN) being time barred & not on merit. But the appeal was rejectedby the lower authorities, aggrieved by the same an appeal was made before the Tribunal.

Two arguments were raised by the Appellant-

1. Appellant mainly contented that the notice had been given beyond the time limit for issuance of notice. As the appellant, being a private company regularly filed the documents regarding balance sheet details therefore, extension period couldn’t be applicable.

2. They also argued that two show cause notices issued on same issue & in both of them extension period was invoked and as the difference reflected in Profit & Loss Account and ST-3 returns was known to the revenue extended period cannot be invoked in the present show cause notice.

HELD: The Hon’ble Ahemdabad Tribunal head that:

1.The demand is not time barred as even though balance sheet being a public document filed with the Registrar of companies under Companies Act, theory of universal knowledge will not apply & the same fact should be made known to the Revenue in proper declaration. Hence in the absence of any declaration, the contention of appellant cannot be relied in the above case.

2.On the issue of invocation of extended period in the second SCN, even after issuance of SCN at initial level as raised by the appellant, it was held that on an issue of the first show cause notice, it was appellant’s duty to inform the revenue about the incorrect value of services in the ST-3 return vis-a vis B/S. Revenue couldn’t imagine that the appellant would continue to follow a wrong practice inspite of earlier show cause notice issued to them. Hence the case laws relied upon by the appellant in support of the fact that extended period cannot be invoked in a subsequent show cause notice distinguished on facts and circumstances and incapable to the present proceedings.

Thus it was held that extended period can be invoked in a subsequent show cause notice.

Conclusion: In view of the above decisions, appeal filed by the appellant was rejected.

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