Tribunal grants waiver of pre-deposit for export services, exempts foreign currency commission from service tax liability

The Appellate Tribunal CESTAT BANGALORE granted the waiver of pre-deposit of demands amounting to Rs. 5,61,521/- and Rs. 14,56,143/- in two separate cases, along with interests and penalties, under Rule 3 of the Export of Service Rules. The Tribunal held that the commission received by the Appellant for services rendered as an agent for a foreign buyer in exporting seafood was in foreign currency, exempting them from service tax liability. The waiver was based on a previous Stay Order in the Appellant's favor and was granted pending the disposal of the appeals.

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Issues involved:
The issue involves the waiver of pre-deposit of demands amounting to Rs. 5,61,521/- and Rs. 14,56,143/- in two separate cases, along with interests and penalties, u/s Rule 3 of the Export of Service Rules.

Summary:

Issue 1: Waiver of pre-deposit of demands

The Appellant, acting as an agent for a foreign buyer in exporting sea food, claimed that they exported services and received payment in foreign currency, thus arguing that service tax is not liable to be paid. The Appellant sought waiver of pre-deposit of demands based on a previous Stay Order in their favor. The Additional Commissioner opposed the waiver, stating that the commission was received in Indian rupees from Indian exporters. The Tribunal, after considering the submissions, held that the Appellant received the commission for services rendered in foreign exchange only. Citing a previous waiver of dues in the Appellant's favor and a case law, the Tribunal granted the waiver of pre-deposit and stayed the recovery of dues until the disposal of the appeals.

This judgment by the Appellate Tribunal CESTAT BANGALORE involved the issue of waiver of pre-deposit of demands amounting to Rs. 5,61,521/- and Rs. 14,56,143/- in two separate cases, along with interests and penalties u/s Rule 3 of the Export of Service Rules. The Appellant, acting as an agent for a foreign buyer in exporting sea food, claimed that they exported services and received payment in foreign currency, thus arguing that service tax is not liable to be paid. The Appellant sought waiver of pre-deposit of demands based on a previous Stay Order in their favor. The Additional Commissioner opposed the waiver, stating that the commission was received in Indian rupees from Indian exporters. The Tribunal, after considering the submissions, held that the Appellant received the commission for services rendered in foreign exchange only. Citing a previous waiver of dues in the Appellant's favor and a case law, the Tribunal granted the waiver of pre-deposit and stayed the recovery of dues until the disposal of the appeals.

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