2007 (8) TMI 77 - AT - Service Tax

Waiver granted for pre-deposit of Service Tax and penalties for services by overseas agent

The CESTAT granted the applicant's waiver of pre-deposit of Service Tax and penalties, amounting to Rs. 39,841, for services provided by an overseas agent ... Levy of service tax on services rendered by an overseas agent outside India - Temporal application of Section 66A (introduced w.e.f. 18-4-2006) and prospective tax liability - Waiver of pre-deposit of disputed tax and penalties pending appealLevy of service tax on services rendered by an overseas agent outside India - Temporal application of Section 66A (introduced w.e.f. 18-4-2006) and prospective tax liability - Waiver of pre-deposit of disputed tax and penalties pending appeal - Pre-deposit of service tax and penalties was waived in respect of services provided by an overseas agent for the period prior to 31-3-2005 on the ground that liability arose only after introduction of Section 66A w.e.f. 18-4-2006. - HELD THAT: - The Tribunal accepted the applicant's contention that, before the introduction of Section 66A effective 18-4-2006, there was no provision to levy service tax on the services in dispute rendered by an overseas agent outside India. Reliance was placed on an earlier stay order in a similar controversy (M/s. Dimensional Stones v. CCE) and, having found that the asserted liability was created only from 18-4-2006 onwards, the Tribunal held that pre-deposit of the disputed service tax and penalties for the period prior to 31-3-2005 need not be made. Accordingly, the stay petition was allowed and the appeal was directed to be listed for further hearing.Pre-deposit of the disputed service tax and penalties waived; stay petition allowed and appeal to be listed.Final Conclusion: The Tribunal allowed the stay application and waived the requirement of pre-deposit of the disputed service tax and penalties for the period prior to 31-3-2005, on the basis that levy arises only from introduction of Section 66A w.e.f. 18-4-2006; appeal ordered to be listed. The applicant filed for waiver of pre-deposit of Service Tax and penalties amounting to Rs. 39,841. The demand is for service provided by an overseas agent before 31-3-2005. The applicant argued that prior to Section 66A introduced on 18-4-2006, there was no provision to levy Service Tax on such services. CESTAT granted waiver based on an earlier stay order on a similar issue. The stay petition was allowed, and the appeal was listed with Appeal No. ST/353/2007.