No Evidence proving Excess Credit Availment to Evade Service Tax: CESTAT says ‘Extended Limitation period’ cannot be Invoked [Read Order]

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Kolkata Bench, held that the alleged availment of excess credit lacked evidence to prove intention to evade service tax and that the extended limitation period cannot be invoked.

The appellant, Radiant Advertising & Marketing (India) Pvt. Ltd., were alleged to have taken an excess amount of credit on the input services for marketing and advertising in print/electronic and other media. The Adjudicating Authority confirmed the demand of service tax and disallowed the wrongfully availed credit, along with interest and penalty.

The Commissioner (Appeals) upheld the confirmed demands and thus, the appellant appealed before the CESTAT. The appellants submitted that they had written off some amount leaving some closing balance and service tax can be charged to 15% of this amount.

The appellants referred to Charts and documents like invoices to explain how the availed credit was utilized. Further, it was submitted that the demand is barred by limitation since the show cause notice was issued beyond 5 years since the period of dispute, i.e., 2011-12.

The CESTAT agreed with the appellant that they were liable to pay 15% of the remaining amount as service tax. The bench also found that the demand is not sustainable on the ground of limitation.

Ashok Jindal (Judicial Member) and K. Anpazhakan (Technical Member) credit the evidence as such documents like invoices brought forth by the appellant to counter the claim that they had wrongfully availed excess credit. It was noted that suppression of fact to evade tax cannot be established and the demand raised and confirmed was set aside as the extended period of limitation was not sustainable.

The appeal was allowed on 30.03.2026.

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