2009 (10) TMI 670 - AT - Service Tax

Summary

Issues involved: Stay petition against waiver of pre-deposit of service tax, education cess, and penalties u/s 77 and u/s 78.

Service Tax Liability Issue:
The confirmation of service tax arose due to the applicant providing packaging services, which was upheld by the Commissioner (Appeals). The applicant argued that they only stitched bags filled by another service provider, citing a previous case where the liability need not be discharged if the original contractor has done so. The respondent contended that there was no evidence of the main contractor discharging the liability, and the services were not of the same category. The Tribunal found that the appellant was only involved in stitching bags as a sub-contractor for unloading and packing fertilizers, covered by a previous decision in favor of the applicant. Considering the pre-Master Circular context and case law cited, the Tribunal allowed the waiver of pre-deposit and stayed recovery pending appeal.

Conclusion:
The Tribunal allowed the waiver of pre-deposit of the service tax, education cess, and penalties u/s 77 and u/s 78, based on the appellant's prima facie case and previous decisions supporting their position.