2009 (9) TMI 114 - AT - Service Tax

Appeal granted waiver on Service Tax pre-deposit for business exhibition services; recovery stayed pending appeal.

The Tribunal allowed the appellant's application for the waiver of pre-deposit amounts in a case concerning the demand of Service Tax on business ... Business exhibition service under Section 65(19a) of the Finance Act, 1994 - leasing of stalls/land - indirect provision of service through an agent - waiver of pre-deposit - stay of recovery pending appealBusiness exhibition service under Section 65(19a) of the Finance Act, 1994 - leasing of stalls/land - indirect provision of service through an agent - waiver of pre-deposit - stay of recovery pending appeal - Whether leasing of stalls/land by the Karnataka Exhibition Authority amounts to rendition of 'business exhibition service' attracting service tax and whether pre-deposit should be waived with recovery stayed pending appeal - HELD THAT: - The Revisionary Authority concluded that business exhibition services can be provided indirectly through an agent and held that the appellant's conduct fell within business exhibition service under Section 65(19a). The Tribunal examined the facts that the Authority owned the ground, called tenders and leased out stalls/space to highest bidders, and did not provide direct exhibition services to participants. On this basis the Tribunal concluded that mere leasing of stalls and land by way of tender does not constitute the provision of business exhibition services as found by the Commissioner. Having found that the appellant has made out a prima facie case against the tax demand, the Tribunal allowed the application for waiver of pre-deposit of the demanded amounts and directed that recovery be stayed until disposal of the appeal.Application for waiver of pre-deposit allowed; recovery of the demanded amounts stayed pending disposal of the appeal.Final Conclusion: The Tribunal held that leasing stalls/land by tender does not, on the material before it, amount to business exhibition service and consequently granted waiver of pre-deposit and stayed recovery of the demand until the appeal is finally disposed of. Issues:Demand of Service Tax on business exhibition services under Section 65(19a) of the Finance Act, 1994.Analysis:The case involved a dispute regarding the demand of Service Tax on business exhibition services provided by the appellant under Section 65(19a) of the Finance Act, 1994. The Joint Commissioner of Central Excise dropped the proceedings initiated by a show cause notice, but the Commissioner of Central Excise & Customs, Mysore, as the revisionary authority, issued another show cause notice disagreeing with the original decision. The Commissioner concluded that the services provided fell under Section 65(19a) and confirmed the demands for Service Tax, interest, and penalty.The appellant, through their Chartered Accountant, argued that they merely leased out stalls in an exhibition ground without providing direct services, contending that their activities did not qualify as 'business exhibition services.' On the other hand, the Departmental Representative highlighted that the stalls were constructed at the exhibition ground and various services were provided to participants, emphasizing that the appellant regulated entry, provided facilities, and charged Service Tax on amounts received from leasing stalls.Upon reviewing the submissions and records, the Tribunal found that the appellant indirectly provided business exhibition services through leasing stalls, acting as an agent. However, it was noted that the leasing of stalls and land did not squarely fit within the definition of 'business exhibition services' as determined by the Commissioner. Consequently, the Tribunal held that the appellant had established a prima facie case for the waiver of the pre-deposit amounts. As a result, the application for the waiver of pre-deposit was allowed, and the recovery of the amounts was stayed pending the disposal of the appeal.