2018 (7) TMI 430 - AT - Service Tax

Misapplication of 75% abatement led to short levy. Tribunal rules in favor of Respondent. No interest or penalty imposed.

Commr. of Service Tax, Kolkata Versus M/s. BPCL

The Respondent wrongly availed 75% abatement on the gross amount charged by the GTA, leading to a short levy. The impugned order dropped the demand, ... Abatement on GTA Services - N/N. 32/2004-ST dated-3.12.2004 - it was alleged that the Respondent assessee has not fulfilled the mandatory condition by proviso (i) & (ii) of N/N. 32/2004-ST, while availing the benefit - Held that:- While issuing the Certificate, the Respondent has copied the wordings of the notification, on the letter head. But facts remain that they have not availed the benefit of Cenvat Credit on inputs or capital goods also the benefit under N/N. 12/2003 (ST). The issue is no longer res integra in view of decision of this Hon’ble Tribunal in the case of Indian Oil Corpn. Ltd. Vs. Commr. of Central Excise, Patna [2013 (6) TMI 201 - CESTAT KOLKATA] wherein it is held that in absence of any particular format, declaration under subject notification, the Department cannot insist for declaration on each consignment note for allowing the abatement - The declaration in letter head and payment bill would be sufficient enough for availing the benefit of Notification. Benefit cannot be denied - appeal dismissed - decided against Revenue. Issues Involved:1. Availment of 75% abatement by the Respondent on the gross amount charged by the GTA.2. Compliance with mandatory conditions of Notification No. 32/2004-ST.3. Dispute regarding the requirement of declaration for availing abatement.4. Interpretation of Circulars and Notifications related to availing abatement.5. Adjudication of the case by the Revenue and subsequent appeal.Issue 1: Availment of 75% abatement by the Respondent on the gross amount charged by the GTA:The Respondent wrongly availed 75% abatement on the gross amount charged by the GTA as per Notification No. 32/2004-ST, resulting in a short levy of a substantial amount. The Show Cause Notice was issued, and the impugned order dropped the demand, leading to no imposition of interest or penalty.Issue 2: Compliance with mandatory conditions of Notification No. 32/2004-ST:The Revenue argued that the Respondent did not fulfill the mandatory conditions of the Notification as they did not produce the requisite certificate in the required format. The benefit under the Notification is available only to those who have not availed Cenvat Credit on duty-paid inputs or capital goods for providing taxable service and have not availed the benefit of Notification No. 12/2003 (ST).Issue 3: Dispute regarding the requirement of declaration for availing abatement:The case involved a dispute over the requirement of a declaration for availing abatement. The Respondent claimed that a declaration on the letterhead and payment bill would be sufficient for availing the benefit of the Notification. The Tribunal referred to previous decisions and circulars to determine the validity of the declaration provided by the Respondent.Issue 4: Interpretation of Circulars and Notifications related to availing abatement:The Tribunal analyzed Circulars issued by the Board regarding the procedure for availing the benefit of the Notification. The Tribunal considered the difficulties faced by both the department and the assesses and provided clarifications on the requirements for availing abatement. Previous decisions were cited to support the interpretation of the Circulars and Notifications.Issue 5: Adjudication of the case by the Revenue and subsequent appeal:The Revenue contended that the adjudication order was legally incorrect as the Respondent had not fulfilled the conditions of the Notification. However, the Tribunal agreed with the submission of the Respondent's advocate, stating that the issue was settled in favor of the Respondent, leading to the dismissal of the Revenue's appeal. The case was disposed of accordingly.This detailed analysis covers the key issues involved in the legal judgment delivered by the Appellate Tribunal CESTAT KOLKATA, providing a comprehensive understanding of the case and the Tribunal's decision.