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of <h1>CESTAT grants full waiver & stay on Service Tax demand pending appeal</h1> <h3>MAHALAKSHMI TRAVELS Versus CCE., C. & ST., VISAKHAPATNAM-I</h3> The Appellate Tribunal CESTAT Bangalore granted a waiver of pre-deposit in full and stayed all proceedings for the liability pending disposal of the ... Levy of tax under ‘tour operator service’ and ‘rent-a-cab’ service - transportation of employees of SEZ units to-and-fro from the places of employment within the SEZ - Held that:- Prima facie, in view of the provisions of Rule 31 of the Special Economic Zone Rules, 2006, issued in conformity with provisions of Section 26(1)(e) of the SEZ Act, 2005; provisions of exemption Notification No. 4/2004-S.T., dated 31-3-2004 [providing exemption from liability to Service Tax on providing of any taxable service to a developer of the Special Economic Zone or a unit (including a unit under construction) of a Special Economic Zone by any service provider, for consumption of service within the Special Economic Zone]; and the judgment of the learned Division Bench of this Tribunal in Norasia Container Lines v. Commissioner of Central Excise, New Delhi reported in [2011 (3) TMI 639 - CESTAT, NEW DELHI], (the judgment having explained the scope of the provisions of SEZ Act, 2005 and of Rule 31 and the scope of Exemption Notification No. 4/2004-S.T.), the petitioner is seen to have made out a strong prima facie case for grant of waiver and stay - Stay granted. Issues:Service Tax demand confirmation, Appropriation of remitted amount, Interest and penalty imposition, Prima facie case for waiver and stay.Service Tax Demand Confirmation:The Commissioner confirmed a Service Tax demand of Rs. 55,24,538, including amounts related to rent-a-cab service, tour operator service to SEZ units, services to other travel agents, and miscellaneous income. The petitioner provided a tabular statement supporting the amounts.Appropriation of Remitted Amount:An amount of Rs. 22,59,510 already remitted under 'tour operator service' and 'rent-a-cab' service was appropriated by the Commissioner towards the confirmed demand.Interest and Penalty Imposition:In addition to confirming the demand, the Commissioner also levied interest and penalty as specified in the order.Prima Facie Case for Waiver and Stay:Considering the provisions of Rule 31 of the Special Economic Zone Rules, 2006, and exemption Notification No. 4/2004-S.T., the petitioner established a strong prima facie case for grant of waiver and stay. Referring to a previous judgment, the Tribunal granted a waiver of pre-deposit in full and stayed all proceedings for the liability pending disposal of the appeal.This judgment by the Appellate Tribunal CESTAT Bangalore addressed issues related to the confirmation of a Service Tax demand, appropriation of remitted amounts, imposition of interest and penalty, and the establishment of a prima facie case for waiver and stay. The Tribunal considered the provisions of SEZ Act, 2005, Rule 31, and Exemption Notification No. 4/2004-S.T. in granting the waiver and stay. The petitioner's tabular statement supported the breakdown of the confirmed demand, including amounts for specific services provided. The Tribunal's decision to grant the waiver and stay was based on the petitioner's strong prima facie case and the interpretation of relevant legal provisions and previous judgments.
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