2010 (4) TMI 667 - AT - Service Tax

Waiver of pre-deposit Service tax on intellectual Property Services - appellant s name is used for conducting event of marketing of members of builders association - not amount to services under Intellectual Property Services - amount of Rs. 30 lakhs already is deposited during pendency of the investigation - application for waiver of pre-deposit of the balance amounts involved is allowed and recovery thereof stayed till the disposal of the appeal

Summary

Issues: Stay petition for waiver of pre-deposit of service tax, penalties under Sections 77 and 78 of the Finance Act, 1994. Interpretation of service tax categories: Club or Association Services, Business Exhibition Services, Intellectual Property Services. Eligibility for Cenvat credit. Appeal against non-imposition of penalty under Section 76 of the Finance Act.

In this judgment by the Appellate Tribunal CESTAT, Bangalore, the issue involved was a stay petition for the waiver of pre-deposit of service tax and penalties under Sections 77 and 78 of the Finance Act, 1994. The appellant sought relief from the pre-deposit of Rs. 75,84,609 as service tax, Rs. 1000 as penalty under Section 77, and Rs. 75,84,609 as penalty under Section 78. The appellant contended that the demand under "Intellectual Property Services" did not stand dispute in law, citing relevant sections of the Act. The appellant argued that the services for which service tax was demanded should be considered as "Event Management" for the appellant's members, i.e., Builders in Kerala, and that the Event Manager had already discharged the service tax. Additionally, the appellant claimed eligibility for Cenvat credit of Rs. 22,05,438 paid on input services.

Upon reviewing the submissions and records, the Tribunal found that the use of the appellant's name for conducting events for marketing members of a builders association did not amount to services under "Intellectual Property Services." Regarding the other two services - "Club or Association Services" and "Business Exhibition Services," the Tribunal deemed the issues arguable. Considering the appellant's eligibility for Cenvat credit and the Rs. 30 lakhs already deposited during the investigation, the Tribunal concluded that this amount was sufficient for the appeal's disposal. Consequently, the application for waiver of pre-deposit of the remaining amounts was allowed, and recovery was stayed pending the appeal's disposal.

Furthermore, the judgment addressed an additional issue raised by the Revenue, appealing against the non-imposition of a penalty under Section 76 of the Finance Act in the same impugned order. The Tribunal directed the Registry to link the Revenue's appeal with the ongoing appeal and list both appeals together for final disposal. The judgment was pronounced and dictated in open court by the members of the Tribunal.