THE HON’BLE THE CHIEF JUSTICE SHRI MADAN B. LOKUR AND THE HON’BLE SHRI JUSTICE SANJAY KUMAR CEA No. 187 OF 2011 DATED:22-11-2011 Between: Commissioner of Customs, Central Excise & Service Tax, Tirupathi. … Appellant And M/s. Sree Rayalaseema Alkalies & Allied Chemicals Ltd., Gondiparla, Kurnool. … Respondent THE HON’BLE THE CHIEF JUSTICE SHRI MADAN B. LOKUR AND THE HON’BLE SHRI JUSTICE SANJAY KUMAR C.E.A. No. 187 OF 2011 JUDGMENT: (per the Hon’ble the Chief Justice Shri Madan B. Lokur) 1. In this appeal under Section 35G of the Central Excise Act, 1944, the appellant is aggrieved by final order Nos. 228 & 229/2011, dated 17.3.2011 passed in Service Tax Appeal Nos. 423 and 424 of 2007. 2. The Tribunal was of the view that the show cause notice issued to the assessee on 19.10.2005 was barred by time. 3. The assessee was a recipient of services rendered by Goods Transport Operators during the period 16.11.1997 to 2.6.1998. A letter was issued to the assessee on 4.11.2003 directing payment of Service Tax on the services received during the relevant period. 4. The letter dated 4.11.2003 was issued on the basis of a letter issued by the Director General of Service Tax on 8.10.2003. The relevant contents of the letter dated 4.11.2003 sent by the Superintendent of Central Excise, Kurnool-II Range, Kurnool, read as follows:- “Please find enclosed the Director General of Service Tax letter D.O. No.V/DGST/30 Misc- 21/2003 PT 3923, dated 8.10.2003. It is requested that you may please go through the contents of the letter and report the compliance with payment particulars of Service Tax on the said services immediately. C.E.A. No.187 of 2011 Page 1 of 4 5. The assessee was aggrieved by the aforesaid letter dated 4.11.2003 and accordingly filed a Writ Petition in this Court, being Writ Petition No. 4553 of 2004. In the interlocutory application filed in that writ petition, an interim stay was granted in favour of the assessee to the effect that the assessee was not required to furnish returns or to pay Service Tax on the services received. 6. It will be clear from the order passed by this Court that there was no stay of any proceedings for recovery of tax in accordance with law. 7. The appellant appears to have misunderstood the interim orders of this Court and did not take any action by way of issuing a show cause notice to the assessee for recovery of service tax. It is only after the aforesaid writ petition was disposed of that the appellant issued a show cause notice to the assessee on 19.10.2005 seeking to recover Service Tax. 8. The assessee was aggrieved by the show cause notice and therefore took up the matter with the appellant. The adjudicating authority as well as the Commissioner of Appeals did not agree with the assessee while the Tribunal agreed with the assessee and came to the conclusion that the show cause notice was barred by time. 9. Learned counsel for the assessee has placed reliance on Section 73 of the Finance Act, 1994 (for short ‘the Act’), which deals with the recovery of Service Tax not levied or paid or short levied or short paid or erroneously refunded. Learned counsel has placed C.E.A. No.187 of 2011 Page 2 of 4 reliance on the explanation to Section 73(1) of the Act. This explanation says that where service of notice is stayed by an order of a Court, the period of such stay shall be excluded in computing the period of one year or five years (as the case may be) for service of notice. 10. As mentioned above, the interim order passed by this Court did not stay service of notice, but only prevented the appellant from recovering tax, which was assessed ex-parte and also required the assessee not to file the returns. 11. It is quite clear from the above that in view of the fact that there was no stay granted by this Court, the provisions of Section 73 of the Act cannot come to the rescue of the appellant. 12. Since the show cause notice was otherwise admittedly issued well beyond time, we have no doubt that there is no merit in this appeal. 13. We may also take note of a decision rendered by the Supreme Court on more or less similar facts in the case of Gokak Patel Volkart Limited vs. CCE[1]. In that case, the Karnataka High Court stayed the collection of excise duty from the assessee. It was argued before the Supreme Court that in view of the stay granted by the Karnataka High Court, the period of stay should be excluded for the purposes of computing the time available for service of the show cause notice. This contention was rejected by the Supreme Court since no interim direction was given by the Karnataka High Court in C.E.A. No.187 of 2011 Page 3 of 4 the matter of issuance of notice or levy of duty. Apart from a plain reading of Section 73 of the Act, we are fortified in our view with the opinion rendered by the Supreme Court in the judgment mentioned above. 14. In our opinion, no substantial question of law arises for consideration. 15. Under these circumstances, we decline to entertain the appeal and it is accordingly dismissed. MADAN B. LOKUR, CJ SANJAY KUMAR, J 22-11-2011 pnb C.E.A. No.187 of 2011 Page 4 of 4 [1] 1987(28) ELT 53 (SC)