2010 (10) TMI 143 - AT - Service Tax

Appeal - Commissioner (Appeals) has dismissed the appeal for non compliance with the stay order passed by him - appellants submits that they are engaged in providing of Courier Service and is duly registered with the service tax department assesssee delivered the goods/documents/articles to the other courier services, no tax stands paid on the said services by him - submits that such services are not covered by the definition of Courier Services, as observed by the Board Circular No. 341/43/96 Held that - directions of Commissioner (Appeals) to further deposit an amount of Rs. Two lakhs, in addition to deposit of Rs. 2.63 Lakhs approximately already made by the appellants not seems to be fair and just - set-aside the impugned order and remand the matter to Commissioner (Appeals) for decision on merits without insisting on any further pre-deposit

Summary

Issues:
1. Dismissal of appeal for non-compliance with stay order.
2. Interpretation of the definition of Courier Services.
3. Fairness of the direction to deposit an additional amount for appeal.

Analysis:
1. The judgment addresses the dismissal of the appeal by the Commissioner (Appeals) due to non-compliance with the stay order. The appellant had already deposited a partial amount of the total service tax along with interest. The stay order required a further deposit of Rs. 2,00,000 under specific sections of the Central Excise Act, which the appellant failed to comply with, leading to the dismissal of the appeal. The Tribunal found this action unjust and set aside the order, remanding the matter for a decision on merits without requiring any additional pre-deposit.

2. The advocate for the appellant argued that the services provided by the appellant, engaged in Courier Services, did not fall under the definition of Courier Services as per a specific Board Circular. The Circular clarified the concept of co-loaders who transport goods on behalf of courier agencies. It stated that the service tax liability lies with the courier agency providing services to the customer, not with the co-loaders. Despite presenting this Circular to the Commissioner (Appeals), it was not considered. The Tribunal acknowledged the Circular's relevance and criticized the Commissioner's failure to follow it, emphasizing the need for a fair assessment based on the Circular's principles.

3. The Tribunal questioned the fairness of the Commissioner's directive to deposit an additional amount of Rs. 2 lakhs, considering the deposit already made by the appellant. It deemed the additional deposit requirement as unjust and instead suggested that the appeal should have been decided on its merits without insisting on further pre-deposit. By setting aside the impugned order and remanding the matter for a fair decision without additional financial obligations, the Tribunal aimed to ensure a just resolution for the appellant without unnecessary financial burdens.

In conclusion, the judgment critically examines the dismissal of the appeal, the interpretation of Courier Services, and the fairness of the financial directives, ultimately emphasizing the need for a balanced and just approach in adjudicating the matter.