2009 (1) TMI 743 - AT - Service Tax

Summary

Issues:
1. Waiver of pre-deposit and stay of recovery of dues adjudged against the appellant.
2. Liability of the applicant to pay service tax under the category of 'Goods Transport Agency' (GTA).
3. Scope of the proposals contained in the show-cause notice.
4. Prima facie case against the adjudged demand of service tax, interest, and penalties.

Analysis:
1. The judgment deals with an application for waiver of pre-deposit and stay of recovery of dues adjudged against the appellant by the original authority and upheld in the impugned order. The original authority demanded service tax of Rs. 1,42,460 found due from the appellant for services rendered under the category of 'Goods Transport Agency' (GTA) during a specific period. Additionally, interest on the tax due and penalties under sections 76, 11, and 71 of the Finance Act, 1994, were imposed. The appellant, a proprietorship concern engaged in trading, sought relief from the adjudged liabilities.

2. The lower authorities determined the liability of the appellant to pay service tax under the GTA category based on Rule 2(1)(d)(v) of the Service Tax Rules, 1994. The rule specifies that the person liable for paying service tax in the case of a goods transport agency is the one who pays or is liable to pay freight for the transportation of goods by road when the consignor or consignee falls within specific categories. Both the original authority and the first appellate authority held the appellant responsible for paying service tax under this rule.

3. The appellant contended that the orders of the lower authorities exceeded the scope of the proposals outlined in the show-cause notice. Specifically, the appellant highlighted a paragraph from the show-cause notice referring to Rule 2(1)(d)(v) of the Service Tax Rules, 1994, to support their argument. The Tribunal acknowledged the appellant's argument, noting that the impugned order appeared to go beyond the scope of the show-cause notice. Consequently, the Tribunal ordered a waiver of pre-deposit and a stay of recovery of the adjudged dues pending the appeal.

4. After considering the submissions from both sides, the Tribunal found that the appellant had established a prima facie case against the adjudged demand of service tax, interest, and penalties. The Tribunal specifically noted that the impugned order seemed to extend beyond the scope of the show-cause notice, leading to the decision to grant the waiver of pre-deposit and stay of recovery of dues pending the appeal. The judgment was dictated and pronounced in open court, providing relief to the appellant based on the identified issues and arguments presented during the proceedings.