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of <h1>Tribunal orders cooperative society to pay Rs. 15.00 Lakhs within 8 weeks to halt recovery</h1> The tribunal directed the cooperative society to deposit Rs. 15.00 Lakhs in addition to the Rs. 5.00 Lakhs already paid within eight weeks. Upon this ... Waiver of pre deposit of Service Tax - construction services - sub contractor or not - Held that:- who supplied manpower to service receivers who in turn rendered construction services to the thermal project. It is the claim of the applicant that as a sub-contractor to the service receiver, the amount of service tax paid by the service receiver on the total taxable value of construction service, be considered as discharge of their service tax liability. The Revenue on the other hand disputes that the services receiver has received the services under the category of manpower supply and rendered services under the category of construction services. Therefore, the service tax paid by the service receiver under the head 'construction services' cannot absolve the present applicant from the liability of service tax on manpower supply service. Prima facie, we agree with the Revenue for the simple reason that to avoid double taxation, mechanism of CENVAT Credit has been introduced in the system. In the event, the service tax paid on manpower supply is used in providing construction service then the service receiver is allowed to take credit and discharge his tax liability. In the result, the applicant could not make out a prima facie case for total waiver of pre deposit of dues adjudged - partial stay granted. Issues:Waiver of pre-deposit of Service Tax and penalties under various sections of the Finance Act, 1994.Analysis:The applicant, a cooperative society providing manpower services to a thermal project, sought waiver of pre-deposit of Service Tax amounting to Rs. 1.18 crores along with penalties imposed under different sections of the Finance Act, 1994. The applicant argued that since the main contractors had already paid service tax on the total project cost, including the value of labor supplied by the applicant, no separate service tax liability should apply to them. However, the Revenue contended that the services provided by the applicant as a sub-contractor were distinct from those provided by the main contractors, and hence, the applicant couldn't be absolved of the service tax liability. The tribunal noted that the service tax demand was raised on the applicant for supplying manpower to service receivers involved in construction services for the thermal project. The tribunal agreed with the Revenue's stance that the service tax paid by the main contractors for construction services couldn't discharge the applicant's liability for manpower supply services. The tribunal highlighted the CENVAT Credit mechanism to avoid double taxation, emphasizing that the service receiver could take credit for service tax paid on manpower supply only if it was used in providing construction services. Consequently, the tribunal directed the applicant, a cooperative society operating on a non-profit basis, to deposit Rs. 15.00 Lakhs in addition to the Rs. 5.00 Lakhs already paid within eight weeks. Upon this deposit, the balance dues would be waived, and recovery stayed during the appeal's pendency, with a compliance report due by 28/08/2014. Failure to comply would result in dismissal of the appeal without further notice.
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