V. Padmanavan ORDER
S.K. Mohanty, Member (J)
1. Brief facts of the case, leading to this appeal, are as under:-
1.1 The appellant is a wholly owned subsidiary of Amway Corporation, USA and is engaged in the business of direct selling of products in different segments such as, personal care, home care, nutrition-wellness, cosmetics etc. The appellant is registered with the jurisdictional service tax authorities for providing various taxable services. The Service Tax Department conducted audit of books of accounts in the premises of the appellant from 16.12.2008 to 20.12.2008 for the period 2004-05 to 2007-08. During the course of audit, it was detected that the appellant had not paid service tax on the expenditure incurred in convertible foreign exchange on account of taxable services namely, "Intellectual Property Service' and 'Business Auxiliary Services' received from the associate company M/s. Amserve. The appellant agreed with the audit objection and deposited Rs. 46,08,759/- and Rs. 1,60,68,000/- respectively. Further, the audit team also observed that the appellant had not paid service tax of Rs. 8,01,78,254/- under the taxable category of 'Franchise Service' in respect of income earned by it during the period October' 2003 to March' 2007 under the heads of accounts namely, 'Joining and Business Fee', 'Business Renewal Fee' and 'Back to Future Fee'. On the basis of such audit objection, the Department issued Show Cause Notice dated 12.03.2009, proposing demand of service tax along with interest and imposition of penalties on the appellant. The said SCN was adjudicated vide the impugned order dated 31.01.2011, wherein service tax demand of Rs. 8,01,68,254/- was confirmed along with interest under the taxable category of 'Franchise Service' by invoking the extended period of limitation under the proviso to Section 73(1) of the Finance Act, 1994. Besides, penalties were imposed on the appellant under Section 77 and 78 ibid. Further, the amount of Rs. 1,60,68,000/- and Rs. 46,08,759/- already deposited by the appellant were appropriated against service tax demand under 'Business Auxiliary Service'. For delayed payment of the said amount, the impugned order has confirmed the interest liability of Rs. 6,57,475/- and Rs. 1,84,116/- respectively under Section 75 ibid and also imposed penalty under Section 76 ibid. Filling aggrieved with the impugned order dated 31.01.2011, the appellant has filed this appeal before the Tribunal.
2.1 The ld. Advocate appearing for the appellant submitted that with regard to 'Franchise Service', the show cause proceedings are barred by limitation of time inasmuch as the Department had complete knowledge of the business activities of the appellant way back in 2005, when pursuant to the summons issued by the DGCEI, the appellant had furnished the detailed information on 07.11.2005. Thus, he submitted that since the business activities of the appellant were known to the Department, suppression of facts cannot be alleged and the show cause notice should have been issued wit........