2013 (12) TMI 1068 - AT - Service Tax

Tribunal rules in favor of Revenue, directs tax payment but waives interest. Upholds tax liability for recruitment agency.

M/s SRI MAHAVIR ENTERPRISES Versus COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX, THIRUCHIRAPALLI

The Tribunal ruled in favor of the Revenue, directing the applicant to pay the tax amount but waiving interest and penalties until the appeal's ... Demand - Man power Recruitment or Supply Agency - Held that:- As the liability to tax of the applicant is not disputed and having failed to produce any evidence of payment of tax, we direct the applicant to pay the entire amount of interest and penalties would be waived till the disposal of the appeal - Decided against assessee. Issues Involved:Application for waiver of pre-deposit of tax under Section 73(1) & 73(2) of the Finance Act, 1994 along with interest and penalties.Analysis:The applicant filed an application seeking waiver of pre-deposit of tax amounting to Rs.14,65,903/- imposed under the proviso to Section 73(1) & 73(2) of the Finance Act, 1994, along with interest under Section 75 and penalties under Sections 77(1)(a), 77(2), and 78 of the said Act. The tax demand was for the period from 16.06.2005 to 28.02.2010. The applicant claimed to have provided services as a 'Man-power Recruitment or Supply Agency.' The main contractor had allegedly paid the tax, but no evidence was produced to support this claim. The applicant argued that the Revenue could verify the duty paid documents from their end.On the other hand, the Revenue pointed out that from August '08 onwards, the applicant collected service tax from another entity on the entire amount charged, including that received through the main contractor. It was highlighted that there was no dispute regarding the applicant's liability to tax, and no evidence was presented to show payment of tax. After hearing both sides and examining the records, the Tribunal was not convinced by the applicant's submission. The Tribunal acknowledged the Revenue's argument that the liability to tax was undisputed, and as the applicant failed to provide evidence of tax payment, the Tribunal directed the applicant to pay the entire amount. However, the Tribunal decided that interest and penalties would be waived until the appeal's disposal, with a deadline set for compliance.In conclusion, the Tribunal found in favor of the Revenue, emphasizing the importance of providing evidence of tax payment and upholding the liability to tax. The applicant was directed to pay the tax amount while granting a waiver on interest and penalties until the appeal's resolution.