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of <h1>Appellant Liable for Service Tax & Penalties Under Finance Act</h1> <h3>THE FINANCERS Versus COMMISSIONER OF C. EX., JAIPUR-II</h3> THE FINANCERS Versus COMMISSIONER OF C. EX., JAIPUR-II - 2008 (11) S.T.R. 55 (Tri. - Del.) Issues:1. Liability of the appellant to pre-deposit service tax and penalties under Sections 77 and 78 of the Finance Act.2. Nature of services provided by the appellant as contract selling agents of a bank.3. Interpretation of business auxiliary services for the purpose of service tax liability.4. Decision on the pre-deposit amount and waiver of balance tax and penalties.Analysis:1. The judgment addresses the liability of the appellant to pre-deposit service tax amounting to Rs. 2,69,852/- along with penalties under Sections 77 and 78 of the Finance Act. Additionally, a penalty of Rs. 1000/- was imposed for the period from July 2003 to February 2005.2. The appellant claimed to be contract selling agents of a bank, collecting application forms from customers for loan processing. The Revenue contended that the appellant was providing business auxiliary services. Reference was made to a previous Tribunal order where a similar matter was remanded for fresh consideration by the Commissioner (Appeals).3. Upon careful consideration, the Tribunal found that the appellant had a strong case regarding the leviability of services to service tax. It was noted that even if the services provided to the bank were not initially considered taxable, they later became so. The Tribunal clarified that under business auxiliary services, the promotion of any service, taxable or not, would fall under the purview of service tax.4. In light of the above analysis, the Tribunal ordered a pre-deposit of 50% of the tax amount within six weeks, with the waiver of the remaining tax and penalties upon such deposit. The appellant was instructed to report compliance by a specified date, ensuring adherence to the Tribunal's directive.This comprehensive analysis of the judgment highlights the key issues addressed by the Tribunal regarding the appellant's service tax liability, the nature of services provided, the interpretation of business auxiliary services, and the decision on the pre-deposit amount and waiver of balance tax and penalties.
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