2009 (6) TMI 876 - AT - Service Tax

Summary

Issues involved: Waiver of service tax, denial of abatement, non-production of declarations, liability of individuals providing transport service, pre-deposit of tax, interest, and penalties.

Waiver of Service Tax:
The Appellate Tribunal CESTAT CHENNAI heard applications for waiver of service tax amounting to Rs. 2,49,617/- and Rs. 1,54,997/- u/s Appeal No. S/77/09 and S/78/09, respectively, along with interest and penalties. The demand for differential service tax stemmed from the denial of abatement as per Notification No. 32/04-S.T. due to the non-production of declarations regarding transporters not availing CENVAT credit on inputs or capital goods and not benefiting from Notification No. 12/03-S.T.

Denial of Abatement:
The applicants argued that the individuals providing transport service were merely truck owners and not goods transport agencies, thus not liable to pay service tax and not registered with the department. They contended that the requirement to furnish declarations by truck owners who are not Goods Transport Agencies (GTAs) did not apply. The Tribunal found merit in this submission as there was no evidence that the individuals providing transport service were registered with the service tax department or were liable to pay service tax. Consequently, the Tribunal waived the pre-deposit of tax, interest, and penalties imposed on the applicants and stayed the recovery during the appeal proceedings.

Liability of Individuals Providing Transport Service:
The crux of the matter revolved around the distinction between individuals providing transport services as truck owners and registered GTAs. The Tribunal noted the absence of findings by the authorities below regarding the registration status of the individuals providing transport service and the lack of evidence of any action taken against them for non-registration or non-payment of service tax. This lack of concrete evidence led the Tribunal to rule in favor of the applicants and grant the waiver of pre-deposit and stay on recovery of tax, interest, and penalties.

Conclusion:
In conclusion, the Appellate Tribunal CESTAT CHENNAI granted the waiver of service tax, interest, and penalties to the applicants based on the lack of evidence establishing the liability of individuals providing transport service and the non-requirement for the applicants to produce declarations from such individuals. The decision to waive the pre-deposit and stay the recovery during the appeal process was made in light of the absence of conclusive findings regarding the registration and tax liability of the transport service providers involved in the case.