2016 (8) TMI 591

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....ted 29.12.2010 (placed at page 65 of the appeal paper book) with M/s. Era Infrastructure Engg. Ltd. (EIEL).  As per the said agreement (para 7 thereof), it was stated that "... We exempted from service tax as per NHAI guidelines.  However, if the same is not applicable, it will be to ERA's account."  The appellant charged the amount for transporting crushed stone, dust and coarse sand, as per the requirements of EIEL, (which was constructing roads) and did not charge any service tax on the invoices.  The audit team visited the appellant premises and vide Audit Memo dated 17.01.2015 (in para-6), stated as under:- "6.  You have wrongly claimed exemption from payment of Service Tax on the gross value of Rs. 1,69,71,0....

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....bsp; (iii)  As the amount was deposited under duress, and not passed on, unjust enrichment was not involved. 4.  Ld. Departmental Representative, on the other hand, submits that the liability to pay service tax to the Govt. cannot be shifted to others by means of a private contract/agreement.  Rule 2(1)(d)(v) of the said Rules essentially gives an option to the service provider not to pay service tax in which case, the liability shifts to the service recipient.  But as a service provider, the liability to pay service tax vests on the appellant and therefore service tax paid by it is not refundable.  Section 67 (2) of the Finance Act, 1994 clearly states that where the gross amount charged is inclusive of service t....

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....the Societies Registration Acct, 1860 (21 of 1860) or under any law corresponding to that Act in force in any part of India; (e)  any co-operative society established by or under any law; (f)  any dealer of excisable goods, who is registered under the Central Excise Act, 1944 (1 of 1944) or the rules made thereunder, or (g)  anybody corporate established, or a partnership firm registered, by or under any law; Any person who pays or is liable to pay freight either himself or through is agent for the transportation of such goods by road in a goods carriage;" Both sides agree that the service recipient is body corporate and paid freight.  Once service recipient is a body corporate and paid freight, as per the afore....

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....n enter into an agreement as who would bear the burden of tax.  It does not state that the liability to pay service tax to the Govt. can be shifted by an agreement between the two parties. Ld. Departmental Representative insisted that the gross amount charged included service tax and therefore the appellant was liable to pay service tax as per Service Tax Rules, 1994.  Regarding this contention, I would like to observe that all the evidences in this case point towards the gross amount charged by the appellant not being inclusive of service tax in-as-much-as the service tax has been shown in the relevant column of the invoice and the appellant's agreement with EIEL clearly stated that if at all then the service tax liability would ....