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of <h1>Tribunal grants waiver for Service Tax & penalty in hospitality industry case</h1> <h3>ITC SONAR Versus COMMISSIONER OF SERVICE TAX</h3> The Tribunal granted the stay petition, waiving the pre-deposit of Service Tax and penalty totaling Rs.95.93 Lakhs. The Applicant, in the hospitality ... Waiver of pre deposit of Service Tax - Rent a cab service - Applicant stationed travel desk in their hotels and respective travel desk provided Rent a cab service' to their customers - In turn the said travel desk has raised bill either in favour of the applicant - Held that:- Applicant are not providing the 'rent a cab services', but the same were provided by one M/s. International Travel House Ltd., who has been stationed in the premises of the Applicant. The said travel house renders the services and the consideration was either directly billed or charged to the Applicant, who in turn, recovers the said charges from the respective customers. We find that the Ld. Commissioner has not accepted their plea solely on the ground that the Applicant could not place evidences of payment of Service Tax by the said travel desk. At this stage we do not find any justification to ask the Applicant to deposit the Service Tax amount which according to them had already suffered Service Tax in the hands of M/s. International Travel House Ltd., as the invoices raised by the said travel house refers to the Service Tax Registration Number mentioned therein - prima facie case is in favor of assessee - Stay granted. Issues:- Application seeking waiver of pre-deposit of Service Tax and penalty.- Service Tax demand related to 'rent a cab service' and services to other divisions.- Applicability of Service Tax for services provided to own division.Analysis:The judgment pertains to an Application for waiver of pre-deposit of Service Tax amounting to Rs.95.93 Lakhs and a penalty under Section 78 of the Finance Act, 1994. The Applicant, in the hospitality industry, operated travel desks in their hotels that provided 'rent a cab service' to customers, with charges included in room rent without markup. The Applicant argued that a significant portion of the demand pertained to this service. The Ld. Sr. Advocate referred to sample bills from M/s. International Travel House Ltd. to demonstrate the billing process. Additionally, the Applicant contended that no Service Tax was leviable for services rendered to their own divisions, citing precedents like Precot Mills Ltd. and Indian Oil Corporation Ltd.The Ld. A.R. for the Revenue supported the findings of the Ld. Commissioner. However, the Tribunal, upon reviewing the sample documents, observed that the 'rent a cab services' were actually provided by M/s. International Travel House Ltd., stationed within the Applicant's premises. The Tribunal noted that the invoices from the travel house mentioned the Service Tax Registration Number, indicating that Service Tax had already been paid. The Ld. Advocate assured that proof of payment of Service Tax by the travel house could be provided. Regarding services to own divisions, the Tribunal referred to previous judgments stating that services cannot be provided to one's own division. Consequently, the Tribunal found a prima facie case for total waiver of the adjudged dues, leading to the waiver of pre-deposit and stay on recovery during the appeal's pendency.In conclusion, the Tribunal granted the stay petition, allowing the waiver of pre-deposit of Service Tax and penalty, based on the Applicant's arguments regarding the 'rent a cab service' and services provided to their own divisions, supported by relevant precedents and documentary evidence.
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