TaxTMI 
TaxTMI 
2011 (8) TMI 608
X X X X Extracts X X X X
X X X X Extracts X X X X
.... agencies towards consideration for the transport of goods by road only with effect from 13.5.2005 i.e. after sub-section (2) was introduced to Section 70 of the Finance Act, 1994 (hereinafter called "the Act"). We have heard separate Standing Counsel appearing for the Central Government and the department concerned which together have filed the appeals and also A.K. Jayasankar Nambiar, counsel appearing for respondents, one of which is Chamber of Commerce and the remaining being members which are limited companies paying service charges to transport agencies for transport of goods by road. 2. The W.P.(C)s were filed by respondents before this court challenging Rule 2(l)(d)(v) on the ground that the said Rule providing for payment of tax b....
X X X X Extracts X X X X
X X X X Extracts X X X X
....er the decision of the Supreme Court in Laghu Udyog Bharati's case (supra) are sufficient to levy and demand service tax on the respondents for the payments made for service availed by them from transport agencies for transport of the goods by road from 1.1.2005. The original proposal to levy tax on transport service was on goods transport operators, which though was introduced in 1997, could not be enforced on account of the massive strike by public carriers, Government later gave up the proposal and introduced sub-section (50b) to Section 65 in January 2005 which provides as follows: "Section 65(50b) Goods transport agency" means any commercial concern which provides service in relation to transport of goods by road and issues consig....
X X X X Extracts X X X X
X X X X Extracts X X X X
....h form and in such manner and at such frequency as may be prescribed." (Emphasis Supplied) 4. The case of the respondents that found acceptance with the learned Single Judge is that inspite of amendment of the charging section and the machinery provision providing for collection of tax in the manner provided under the Act and Rules unless provision is introduced requiring the person availing service notified under Section 69(2) to file the return, he has no liability to furnish the return and pay tax. Another important ground raised by the respondents in support of their challenge against the applicability of the Rules for any period prior to coming into force of Section 70(2) of the Act is the want of form for return in ST-3, under which ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....preme Court held as follows : "These sections clearly show that the return which has to be filed pertains to the payment which are received by the person rendering the service in respect of the value of the taxable services. Surely, this is a type of information which cannot, under any circumstances, be supplied by the customer. Moreover the operative part of sub-section (1) of Section 70 clearly stipulates that it is a person responsible for collecting the service tax who is to furnish the return. By rules which are framed, the person who is receiving the services cannot be made responsible for filing the return and paying the tax. Such a position is certainly not contemplated by the Act." Admittedly the service tax liability dealt with ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e already stated above. Strangely, the Government has not chosen to give retrospectivity to Section 70(2) as well as to the Form prescribed under Rule 7. What the appellants seek to achieve is essentially retrospectivity for Section 70(2) without which respondents were not required to furnish return and pay tax. In other words, the amendment introduced after Laghu Udyog Bharati's case (supra) was inadequate to bring the respondents within the scope of the levy in as much as they were not required to furnish any return and the form of return itself was not prescribed. So much so, we feel the respondents rightly started remitting tax only after introduction of Section 70(2) i.e. with effect from 13.5.2005 and no tax could be levied from t....