Appellant not liable for double service tax payment on transportation services

The appellant was found not liable to pay any service tax. The court ruled that the Cenvat Credit account could be used for Inwards Transportation Service payment based on a precedent. As the transporter had already paid service tax on Outwards Transportation Service, the appellant was not required to make double payment. Consequently, the demand for service tax was deemed unsustainable, and the appellant's appeal was allowed with any necessary relief.

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Issues:
- (A) Whether the appellant can utilize the Cenvat Credit account for payment of Inwards Transportation Service or notRs.
- (B) Whether the service tax is paid by the transporter on Outwards Transportation Service, the appellant is required to pay service tax or notRs.

Analysis:

(A) Utilization of Cenvat Credit for Inwards Transportation Service:
The issue of whether the appellant can utilize the Cenvat Credit account for payment of Inwards Transportation Service was addressed by referring to a precedent set by the Hon'ble Punjab & Haryana High Court in the case of CCE vs. Nahar Industrial Enterprises Ltd. The court held that the Cenvat credit account can indeed be used for payment of Inwards Transportation Service. Following this decision, it was concluded that no demand is sustainable against the appellant in this regard.

(B) Liability for Service Tax on Outwards Transportation Service:
Regarding the payment of service tax on Outwards Transportation Service, it was noted that the transporter had already paid the service tax. Considering this, it was determined that the appellant is not required to pay the service tax on the same service, as it would result in double payment. Therefore, the demand for service tax on Outwards Transportation Service was deemed unsustainable against the appellant.

In light of the above analysis, it was concluded that the appellant is not liable to pay any service tax. Consequently, the impugned order was deemed to lack merit and was set aside. As a result, the appeal was allowed with any consequential relief that may be applicable.

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