2017 (12) TMI 682 - AT - Service Tax

Tribunal rules in favor of appellant, no double taxation required. CBEC circular cited. Appeal allowed.

The tribunal ruled in favor of the appellant, holding that the appellant was not required to discharge the disputed service tax amount of approximately ... GTA services - Reverse Charge Mechanism - CEBC Circular dated 17.12.2004 - Held that: - Since the service tax liability due from the appellant stands deposited with the Govt of India by RTCL, as per the CBEC Circular, no demands can be raised on the appellant - demand set aside - interest also set aside - appeal allowed - decided in favor of appellant. Issues:1. Whether the appellant is required to discharge an amount of approximately Rs. 36.33 lakhs as service tax or not.Analysis:The appeal involved a consideration of whether the appellant was liable to pay approximately Rs. 36.33 lakhs as service tax. The appellant had received services from a goods transport agency during a specific period. A show-cause notice was issued for the demand of tax due to a retrospective amendment. The adjudicating authority confirmed the demand, but the appellant contested it on grounds that the amount had already been paid by them to the agency, which was accepted by the Revenue. The appellant argued that as per a CBEC circular, if the service tax liability is discharged by one party, it should not be charged from another to avoid double taxation. The appellant's position was supported by documentary evidence and findings of the adjudicating authority, which confirmed that the service provider had collected but not deposited the tax amount with the government. The tribunal agreed with the appellant's submissions, citing the CBEC circular, and held that since the service tax liability was already paid by the service provider, no demands could be raised on the appellant. Consequently, the demand of Rs. 36.33 lakhs was deemed unsustainable and set aside, along with the interest on the amount.Overall, the tribunal found merit in the appellant's arguments and the evidence presented, concluding that the appellant was not required to discharge the disputed service tax amount as it had already been paid by the service provider. The tribunal set aside the impugned order to the extent contested and allowed the appeal, ruling in favor of the appellant.