Documentary compliance with exemption conditions sustained service tax relief where consignment notes supported the claim.

Documentary proof showing transport of goods under proper consignment notes was treated as sufficient compliance with Notification No. 32/2004-ST, and the assessee's burden of proof was held discharged. Any alleged non-compliance with the notification's conditions, if it existed, was to be examined at the transporters' level, and the Revenue could not deny the exemption without verifying whether those conditions were actually breached. On that basis, the service tax demand was found unsustainable and the appellant obtained relief from the disputed liability.

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Issues: Whether the appellant was entitled to the benefit of Notification No. 32/2004-ST dated 3-12-2004 on the basis of the documents showing transport of goods under appropriate consignment notes.

Analysis: The documents produced showed transport of the goods under appropriate consignment notes, and the appellant had discharged its burden of proof. Any non-compliance with the conditions of the notification, if at all, had to be examined at the level of the transporters who issued the consignment notes. Since the Revenue had not taken steps to verify whether the transporters had deviated from the prescribed conditions, the denial of the notification benefit was not justified.

Conclusion: The appellant was entitled to the benefit of Notification No. 32/2004-ST dated 3-12-2004, and the service tax demand was unsustainable.

Final Conclusion: The appeal and stay application were allowed, resulting in relief to the appellant from the disputed service tax liability.

Ratio Decidendi: Where the assessee produces documentary evidence showing compliance with the stated conditions of an exemption notification, the Revenue must its denial on a demonstrated breach of those conditions and cannot reject the claim without verification of the relevant factual compliance.

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