P.G. Chacko Judicial Member - This application filed by the appellant seeks waiver of pre-deposit and stay of recovery in respect of the adjudged dues which include an amount of Rs. 12.75 crore demanded from them towards service tax and education cess under the head 'franchise service'. On a perusal of the records, we find that the impugned demand is a levy on an amount of Rs. 125 crore taken as taxable value of the said service. This amount of Rs. 125 crore was the consideration paid to the appellant by their wholly owned subsidiary M/s. Godavari Toll Bridge Pvt. Ltd. as per a resolution passed on 25-3-2006 by the Board of Directors of the appellant. As per the said resolution, the appellant assigned to the said subsidiary the entire right to collect toll in respect of Yenam-Yedurulanka in Bridge in East Godavari District in the State of Andhra Pradesh. The said bridge was constructed by the appellant under a 'Build-Operate-Transfer' (BOT) Agreement with the Government of Andhra Pradesh, dated 6-10-1999. Under that agreement, the total investment was Rs. 110 crore and subsidy to the extent of Rs. 69 crore was granted by the State Government and the balance amount constituted the appellant's investment. As per the agreement, the appellant was entitled to collect toll from the users of the bridge for a period of 15 years. They did collect the toll for the first 4½ years. In respect of the remaining period, the right to collect toll came to be assigned to the appellant's subsidiary as per the company's resolution dated 25-3-2006 ibid. These facts are not in dispute. The case of the appellant is that no franchise as defined under section 65(47) of the Finance Act, 1994 was involved in the transaction between the appellant and its subsidiary inasmuch as no representational right to provide any taxable service to any other person was granted by the appellant to its subsidiary. It is submitted by the learned counsel for the appellant that the very levy of toll itself has been recognized by the Board as a non-taxable service by virtue of such levy having been included in the State List of Schedule VII to the Constitution. The reference is to Circular No. 152/3/2012-S.T., dated 22-2-2012. The learned counsel further relies on the Tribunal's decision in the case of Intertoll India Consultants (P) Ltd. v. CCE, [2011] 32 STT 269 wherein the users of a similar bridge were held to be not customers of the agency which collected the toll and consequently it was held that service tax was not leviable under the head 'business auxiliary service' on the amount retained by the toll collector. Support has been claimed from Swarna Tollway (P.) Ltd. v. CCE, Guntur [2011 (24) STR 738 (Tri.-Bang.)] also. It is further pointed out that the impugned demand is on a one-day transaction of 31-3-2006 and the show-cause notice was issued as late as on 30-6-2008 invoking the extended period of limitation it is submitted that there was no valid reason for invoking the extended period of limitation in this case.

2. The learned Special Consultant for the respondent refers to the facts of the case in general and particularly to the terms of the BOT agreement between the appellant and the Andhra Pradesh Government and the assignment dated 25-3-2006 by the appellant to its subsidiary. It is his submission that the subsidiary received from the appellant the right to collect toll from the users of the bridge representing itself to be the grantee of the right granted by the appellant. It is submitted that, even in the absence of such an arrangement between the appellant and the subsidiary, the appellant ought to have operated the bridge by allowing it to be used by the vehicle owners and keeping the bridge in good repairs. It is argued that such activity being a service to the people and the State Government, the appellant has granted their subsidiary a franchise and, therefore, the amounts collected by them from the subsidiary should be subjected to service tax u