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2026 Supreme(Online)(CESTAT) 607

CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL
Sanjiv Srivastava, Technical Member
Wealth Mantra Commodities Pvt. Ltd. – Appellant
Versus
Commissioner, CGST & Central Excise, Lucknow – Respondent
Service Tax Appeal No.70044 of 2026

Advocates:
For the Appellants/Petitioners: Arun Srivastava
For the Respondents: Chitra Srivastava

When a superior court directs an adjudicating authority to specifically decide on the issue of limitation regarding a show-cause notice, a failure by the authority to record findings on that point necessitates a remand of the matter for fresh adjudication.

Headnote:(A) Finance Act, 1994 - Section 73 - Limitation - Extended period of limitation - Invocation - Where there is willful suppression of facts or evasion of service tax, the extended period of limitation under the proviso to Section 73(1) is applicable. (Para 4.2)

(B) Appellate Procedure - Remand - Where the lower authorities fail to provide specific findings on the issue of limitation despite explicit judicial direction from the High Court, the matter must be remanded for fresh consideration. (Paras 4.3, 4.7)

Facts of the case:
Appellant was engaged in providing taxable services under the Finance Act, 1994. Intelligence of tax evasion led to a search and seizure operation. Subsequently, a demand notice was issued for short-paid service tax, interest, late fees, and inadmissible Cenvat Credit. The Appellant challenged the proceedings before the High Court, which directed the Adjudicating Authority to decide the issue of limitation with specific reasoning. The lower authorities confirmed the demand without properly addressing the limitation issue as directed by the High Court.

Findings of Court:
The Court held that the mandatory requirement to record specific findings on the issue of limitation, as directed by the High Court, was not complied with by the lower authorities. Consequently, the matter warrants remand for a fresh decision on the limitation issue.

Issues: Whether the show-cause notice was time-barred and whether the lower authorities failed to comply with the High Court's directions regarding the determination of the limitation period.

Ratio Decidendi: Where an appellate order or prior judicial order necessitates a specific factual finding on the threshold issue of limitation, an adjudicating authority cannot bypass this requirement; failure to do so renders the order susceptible to remand for compliance.

Result: Appeal allowed; matter remanded to the Original Authority.

SANJIV SRIVASTAVA:

This appeal is directed against the Order-In-Appeal No. 234-ST-APPL-LKO-2025, dated 10.07.2025 passed by Commissioner (Appeals) CGST & Central Excise, Lucknow. By the impugned order Commissioner (Appeals) has upheld the Order In-Original No.266AC/CGST/LKO-I/WMCPL/2023-24 holding as follows:-

ORDER

(i) I confirm the demand of service tax amounting to Rs. 6,18,861/- under Section 73 of the Finance Act, 1994 read with Section 142 and 174 of the CGST Act, 2017.

(ii) I confirm the demand of interest on the amount of Service Tax mentioned at (i) above under Section 75 of the Finance Act, 1994 read with Section 142, 173 & 174 of the CGST Act, 2017.

(iii) I impose Penalty amounting to Rs. 6,18,861/- under Section 78 of the Finance Act 1994 read with Section 142, Section 173 & Section 174 of the CGST Act, 2017.

(iv) I impose Penalty amounting to Rs. 10,000/- under Section 77(1)(d) of the Finance Act, 1994 read with Section 142, Section 173 & Section 174 of the CGST Act, 2017.

(v) I confirm the demand of Late fees under Rule 7C of the Rules read with Section 70 of the Act read with Section 142 and 174 of CGST Act for not furnishing the Service Tax return within due date of filing of returms.

(vi) I impose Penalty amounting to Rs. 10,000/- under Section 77(1)(c)(i) and 77(1)(c)(ii) of the Finance Act, 1994 read with Section 142, Section 173 & Section 174 of the CGST Act, 2017 for not providing the documents when asked by the investigating Officer.

(vii) I impose Penalty amounting to Rs. 10,000/- under Section 77(1)(c)(iii) of the Finance Act, 1994 read with Section 142, Section 173 & Section 174 of the CGST Act, 2017 for not complying with the summons.

(viii) I confirm the demand of inadmissible Cenvat Credit to the tune of Rs.4,74,374/- under Rule 14 of CENVAT Credit Rules, 2004 read with Section 73 of the Finance Act, 1994.

2.1 The Appellant during the period in dispute was registered with the Service Tax Department having Service Tax Registration No.AAHCS7515ESD003 and was engaged in providing taxable services under the category of "Business Auxiliary Services, Services provided by recognized/registered associations in relation to forward contracts, Security/detective agency service, Business support service, Works contract service and other taxable services" as defined in the erstwhile Finance Act, 1994.

2.2 On the intelligence received that M/s Wealth Mantra Infracon Pvt. Ltd, 403, 4th Floor, Shalimar Titanium, Vibhuti Khand, Gomti Nagar, Lucknow was not paying Service Tax commensurate to various services provided by them and were showing ‘NIL’ revenue from the operations in their balance sheet for the year 2014-15 & 2015-16 whereas they had collected and paid taxes as shown in their Service Tax Returns during the said Financial Year.

2.3 A search was conducted on 13.07.2018 at the premises of the said entity. During the scrutiny of records resumed at the time of search it was found that the said entity namely M/s Wealth Mantra Infracon Pvt. Ltd. has subsidiaries, associates and jointly controlled companies, where under some companies where found engaged in similar line of business and others engaged in different businesses. One of such subsidiary company was the Appellant who was engaged in providing taxable services.

2.4 During the search on the said date records pertaining to the Appellant were also found and resumed from the said premises. Statement of Shri Phool Chandra Yadav, Sr. Executive of M/s Wealth Mantra Infracon Pvt. Ltd. was recorded on 13.07.2018 wherein he submitted as follows:-

(1) Shri Sanjeev Agarwal is the Director of M/s. Wealth Mantra Commodities Private Limited, Lucknow.

(ii) The premises of M/s. Wealth Mantra Commodities Private Limited, Lucknow 403, 4th Floor, Shalimar Titanium, Vibhuti Khand, Gomti Nagar, Lucknow, the place visited by the officers, is the office of the Wealth Mantra Group where different persons supervise the work of different companies of this Group.

2.5 Letters dated 17

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2026 Supreme(Online)(CESTAT) 607

CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNALSanjiv Srivastava, Technical MemberWealth Mantra Commodities Pvt. Ltd. – AppellantVersusCommissioner, CGST & Central Excise, Lucknow – RespondentService Tax Appeal No.70044 of 2026

When a superior court directs an adjudicating authority to specifically decide on the issue of limitation regarding a show-cause notice, a failure by the authority to record findings on that point necessitates a remand of the matter for fresh adjudication.

CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL
Sanjiv Srivastava, Technical Member
Wealth Mantra Commodities Pvt. Ltd. – Appellant
Versus
Commissioner, CGST & Central Excise, Lucknow – Respondent
Service Tax Appeal No.70044 of 2026