2013 (8) TMI 605 - AT - Service Tax

Tribunal grants appellant full waiver of pre-deposit in Service Tax dispute

M/s Gujarat NRE Coke Ltd. Versus CCE Rajkot

The Tribunal ruled in favor of the appellant, granting a complete waiver of pre-deposit of the amounts involved in the Service Tax liability dispute ... Goods Transport Agency services u/s 66A - Reverse charge mechanism - Waiver of pre deposit - Held that:- there is no evidence to show that M/s Shreeji Shipping/M/s Shreeji Roadways has raised invoices in the name of the appellant for transportation of coal/coke from Port to the factory premises. It is also seen from the record that the appellant has been taking a consistent stand that all the transportation of coal/coke has been done by the truck owners, and the freight is paid through M/s Shreeji Shipping to them and not to Goods Transport Agency - prima facie, appellant has made out a case for complete waiver of pre-deposit of the amounts involved - Following decision of LAKSHMINARAYANA MINING CO. Versus COMMR. OF S. T., BANGALORE [2009 (9) TMI 71 - CESTAT, BANGALORE] - Decided in favour of assessee. Issues:1. Stay petitions for waiver of pre-deposit of amounts demanded in Service Tax liability with penalties.2. Dispute regarding the responsibility for Service Tax liability on transportation of coal from Port to factory.3. Interpretation of Section 66A of the Finance Act, 1994, and reverse charge mechanism.4. Evidence of invoicing and payment for transportation services by Goods Transport Agency.5. Application of legal precedents in similar cases to determine liability.Analysis:1. The appellant filed Stay Petitions seeking waiver of pre-deposit of amounts demanded as Service Tax liability with penalties. The demands were confirmed due to the appellant's alleged failure to discharge Service Tax liability on transportation of coal from Port to their factory.2. The counsel argued that the show cause notices referred to the discharge of Service Tax liability on Goods Transport Agency services under Section 66A through reverse charge mechanism. It was highlighted that the trucks used for transportation were owned by individuals, not transport agencies as held by the adjudicating authority. Legal precedents were cited to support the appellant's position.3. The Departmental Representative contended that the transport agencies had indeed provided services, and the appellant, as the service recipient, was liable to pay Service Tax under Section 66A through reverse charge mechanism. The statement of the General Manager was also referenced to support this argument.4. Upon review, it was found that there was no evidence of invoicing by the transport agencies in the appellant's name for the transportation services. The appellant consistently maintained that payments were made to individual truck owners through the transport agencies, not to Goods Transport Agency directly. Citing a legal precedent, it was determined that the Service Tax liability rested on the Goods Transport Agency, not individual truck owners.5. Considering the arguments and evidence presented, the Tribunal ruled in favor of the appellant, granting a complete waiver of pre-deposit of the amounts involved. The recovery of the demanded amounts was stayed pending the disposal of the appeals. The decision was based on the lack of evidence showing invoicing to the appellant by the transport agencies and the consistent stance taken by the appellant regarding payment to individual truck owners.This detailed analysis of the judgment addresses the issues raised in the Stay Petitions and provides a comprehensive overview of the legal reasoning and interpretation involved in the decision-making process.