TaxTMI 
TaxTMI 
TaxTMI 
2022 (8) TMI 496
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.... appellant had not discharged the applicable service tax. On completion of the enquiry, a show cause notice dated 31.03.2013 was issued to the appellant proposing to recover service tax of Rs.1,42,82,025/- alongwith penalty under section 77 and section 78 of Finance Act, 1994. The show cause notice was adjudicated, vide impugned order, confirming the duty and imposing penalties and hence, this appeal. 3. Shri Dharmendra Srivastava, Chartered Accountant, appearing for the appellant submits that the appellant acted as a facilitator of transportation of goods from Railway siding to Nepal by arranging either their own trucks or other truck operators/owners on commission basis of Rs.100/- per truck. Learned Chartered Accountant submits that the demand under 'Goods Transport Agency Service' is not sustainable as the appellant is not a goods transport agency but was engaged in activity of arranging transportation of goods by arranging trucks; it had not issued any consignment note and had issued only truck delivery challans. He submits that the Nepal Parties authorize him, for transport of goods from Railway siding, on the back side of the Railway Receipt; they acknowledge also on the sa....
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.... owners is not sustainable. The said commission is not paid by the Nepali parties. Therefore, it cannot be said to be 'Business Auxiliary Service'. He submits that no tax liability arises as appellant is entitled to basic exemption under Notification No.6/2005-ST dated 01.03.2005 and Notification No.33/2012-ST dated 20.06.2012 as may be applicable during the period. 6. Learned Chartered Accountant submits lastly that there is unreasonable delay in issuing of show cause notice; the Department started enquiries vide letter dated 27.10.2009 which was replied; show cause notice was issued after nearly three and half years. There was no suppression of facts as issue involves interpretation of taxes. He relies on C.C.E., Indore vs. Prashant Electrode [2006 (196) E.L.T. 297 (Tri.-Del.)] and Mohan Goldwater Breweries Ltd. vs. C.C.E. & S.T., Lucknow [.2017 (4) G.S.T.L. 170 (Tri.-All.)] 7. Shri B. K. Jain, learned Authorised Representative, appearing for the Respondent department, reiterates the findings of the impugned Order-in-Original and submits that the appellants have rendered the services on 'Goods Transport Agency Service' and have issued challans which incorporate all the particul....
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....e concerned in this case is are as to whether (i). the activity undertaken by the appellant in providing trucks for transportation of goods from railway siding in Gorakhpur to different parts of Nepal are covered under category of transport of goods by road service in terms of Section 65 (105) of Finance Act, 1994? (ii). the appellants have rendered ' Business Auxiliary Service under section 65(105) (zzb) of Finance Act, 1994 in respect of the commission earned from trucks they hired on behalf of the Nepal parties at a commission? (iii). it was correct to allege rendering of 'Manpower Recruitment Services' in the show cause notice and confirm the same under 'Goods Transport Agency Service' in the Order-in-Original? (iv). extended period is invokable in the facts and circumstances of the case and whether penalties imposed are justifiable. 10. We find that the appellant had provided its own trucks or trucks of some others on commission of Rs.100/- to the Nepal traders for carrying of goods i.e. clinker etc from Railway siding in Gorakhpur to different destinations in Nepal. Appellant issued challans for the work undertaken. It is the contention of the department that the said ch....
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....uce evidence to substantiate the allegation, the department cannot hide behind the ratio of a judgment, delivered, in some other context, stating that Revenue is not required to prove with mathematical precision. The Department cannot cover up half baked enquiry and issuance of demand under any judicial pronouncement. Instead of proving the existence of distinct elements, to fasten tax liability, like service provider, classification of service rendered, service recipient and consideration received, the department cannot just rely on figures culled from Income Tax Returns, 26AS Statement, balance sheet, profit and loss account etc. The impugned order has seriously erred in confirming the duty liability simply on the basis of the figures obtained from documents like Income Tax Returns etc. without causing a bare minimum enquiry with all the concerned parties. Moreover, the taxability of the appellant when they receive consideration from the customers residing in Nepal, on reverse charge mechanism is not established. 12. Moreover, we find that it is also not established that the appellant's activity falls under 'Goods Transport Agency Services'; no agreement contract etc. whatsoever....
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....order has travelled beyond scope of the show cause notice as far as loading unloading charges are concerned. 14. Coming to the demand of service tax on 'Business Auxiliary Service' the appellant submits that he has taken only a commission of Rs.100/- per truck when he arranged trucks from other owners. The Department argues that this is 'Business Auxiliary Service'. The consideration for such hiring was not paid by the Nepali Traders. It cannot be said that the appellant had rendered 'Business Auxiliary Service'' to the individual transporters/truck owners. No explanation to that effect was given in the Show Cause Notice or the impugned order. Further, we find that the appellant submits that the the appellant is not liable to pay service tax as 'Goods Transport Agency', and under such circumstances, the commission received by him is within the taxable limits over the years in terms of the Notifications issued from time to time. We find that there is force in the argument of the appellant. As we have held above, the department has simply confirmed the service tax liability against the appellant without going into the details of arrangements between the appellant and his clients rel....
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....ed vide the Truck carrying the Number as quoted in the Challan. Department has failed to establish that these 'Truck delivery challans' are consignment note which are issued by the appellant as Goods Transport Agent. That Service tax is on goods transport agencies and not on individual transport vehicle/ truck owners/operator who provides transportation of goods by road through owned trucks/outside trucks, as their services is in the negative list. Relevant extract of the Section 66D, Negative list of services is reproduced as under:- The negative list shall comprise of the following services, namely:-- (p) Services by way of transportation of goods- (i) By road except the services of (A) A goods transportation agency; Thus, the impugned activity of the appellant not being in the nature of transportation of goods by road by a GTA is in the negative list and hence, not subject to service tax for the period after 01.07.2012. That when the services of the appellant are not subject to service tax, demand of tax on freight is dropped, therefore, there is no requirement to discuss the issue of taxability on so called 'notional freight' (in respect ....