By Puloma Dalal, Jayesh Gogri, Mandar Telang Chartered Accountants
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Whether the proceedings initiated by an order dated after the amendment, in respect to the period prior to the amendment by invoking the provision before amendment is vitiated after the amendment? Held, Yes.
Facts:
Department issued show cause notice as on 06-10-2004 calling upon the respondent to show cause as to why the service tax for security services rendered for the period from 16th October, 1998 to 31st March, 2004 should not be demanded under the provisions of section 73(1)(a) of the Act, invoking the extended period of limitation, and why it should not be recovered u/s. 73(2)(a) of the Act. The provisions contained in section 73(1)(a) of the Act were substituted vide Finance Act, 2004 with effect from 10-09-2004. The provision prevailing prior to 10-09-2004 was providing for value of taxable services escaping assessment, while after its substitution vide Finance Act, 2004, it provided for recovery of service tax not levied or paid or short-levied or short-paid or erroneously refunded.
Held
The High Court held that admittedly, on the date of show cause notice, i.e., 06-10-2004, the provisions contained in section 73(1)(a) of the said Act, prevailing prior to 10-09- 2004, were not in existence. In other words, the statutory provision under which the show cause notice issued was not in existence as on that date, and therefore as rightly held by the Tribunal SCN is not valid.
