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Issues: Application for waiver of pre-deposit of demand of service tax and penalty based on the nature of service provided as a Rent-a-cab operator.
Analysis: 1. Nature of Service Provided: The demand for service tax was confirmed as the applicants were engaged in the business of Rent-a-cab services. The relevant provisions under Section 65 Sub-Section 91 of Chapter V of the Finance Act, 1994 define a Rent-a-cab Scheme operator as a person renting cabs for taxable services. The definition of taxable service includes services provided by a Rent-a-cab Scheme operator in relation to the renting of cabs. 2. Plea of Taxable Service: The applicants had not raised any plea before the lower authorities regarding the nature of the service provided under the Finance Act. However, during the appeal, they referred to a previous Tribunal decision where it was held that renting a cab on a kilometer basis may not constitute a taxable service. The Revenue countered this argument by highlighting that the applicants rented cabs both on a monthly basis and kilometer basis, asserting that the previous decision may not be directly applicable. 3. Decision and Ruling: The Tribunal found that the applicants were indeed providing taxable services as a Rent-a-cab operator by renting cabs on both monthly and kilometer bases to M/s. GAIL (India) Ltd. Consequently, the Tribunal ruled that it was not a suitable case for a complete waiver of the service tax amount. The applicants were directed to deposit a specific amount for the appeal hearing, while the remaining duty and penalty were waived for the same purpose. The case was adjourned for compliance to the specified deposit within a given timeframe. This judgment highlights the importance of understanding the specific nature of services provided in relation to tax liabilities and the significance of raising relevant pleas at the appropriate stages of legal proceedings. The decision underscores the Tribunal's discretion in determining the eligibility for waiver of tax amounts based on the circumstances of each case and the applicability of legal precedents to the specific facts presented.
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