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of <h1>Tribunal Upholds Service Tax Demand on Warehousing Service for Soya Bean Meal</h1> <h3>M/s Duraflex Services & Construction Technologies Ltd. Versus Commissioner of Central Excise, Visakhapatnam</h3> M/s Duraflex Services & Construction Technologies Ltd. Versus Commissioner of Central Excise, Visakhapatnam - TMI Issues:1. Demand of service tax on 'Storage and Warehousing Service' for 'Soya Bean Meal stock management charges'.2. Demand related to utilization of CENVAT credit for payment of service tax.3. Applicability of exemption on 'storage and warehousing services' for 'agricultural produce'.4. Financial difficulty faced by the appellant.5. Pre-deposit amount offered by the appellant.Analysis:1. The appellant faced two show-cause notices demanding service tax. The first notice sought Rs. 16,00,168 for 'Soya Bean Meal stock management charges' under 'Storage and Warehousing Service'. The second notice included demands for engaging in exempted and dutiable services, exceeding CENVAT credit utilization, and charging for exempted services. The demands were confirmed with interest and penalties under the Finance Act, 1994.2. The consultant argued for a limitation on the demand of Rs. 58,30,168 due to excess CENVAT credit utilization. The Tribunal found the appellant regularly filed ST-3 returns, indicating credit usage, thus limiting the demand. The consultant also contested the Rs. 16,00,168 demand, claiming exemption under Notification No. 1/2006 for 'agricultural produce'. However, the Tribunal ruled against the appellant as 'soya bean meal' did not qualify as agricultural produce under the notification.3. The consultant further argued that the appellant only charged rent for space, not 'storage and warehousing' services. However, invoices revealed charges for stock management of 'soya bean meal' based on quantity, not space provided. The Tribunal found the appellant's judgment flawed, making the extended period applicable. The appellant's financial difficulties were raised, but without substantial evidence.4. The consultant offered Rs. 5 lakhs as a pre-deposit, which was accepted by the Tribunal. The appellant was directed to deposit the amount within six weeks. Upon compliance, the pre-deposit of the balance dues was waived, and a stay on recovery was granted during the appeal's pendency.
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