2010 (6) TMI 425 - AT - Service Tax

Stay order Lower authority confirmed service tax demand on assessee on ground that it was receiving services of GTA assessee not availing the services of Goods Transport Agency but were availing services of truck owners or goods transport operators - two persons were giving services were truck owners or transport operators - demand of service tax on the services received from the truck owners or goods transport operators as GTA service is inappropriate and cannot be sustained - stay application allowed

Summary

Issues:
Service tax liability on transportation of goods to customers' premises.

Analysis:
The case involves two stay petitions filed against an Order-in-Appeal confirming service tax demands. The issue revolves around the service tax liability on the transportation of goods to customers' premises. The lower authorities held that the appellants were providing services as a 'Goods Transport Agency', making them liable to pay service tax under the Finance Act, 1994. The appellant argued that they were not availing services under the 'Goods Transport Agency' category but were using services of truck owners or goods transport operators. They cited the Budget Speech of the Finance Minister and previous judgments to support their claim.

The key contention was whether the appellant was availing services from a 'Goods Transport Agency' or from truck owners/goods transport operators. The appellant maintained that they were not utilizing the services of a 'Goods Transport Agency' and should not be liable for service tax. The Tribunal found that the lower authorities had not effectively countered the appellant's claim. Citing relevant portions of the Budget Speech and previous judgments, the Tribunal concluded that demanding service tax on services received from truck owners or goods transport operators as 'Goods Transport Agency' services was inappropriate and unsustainable. The Tribunal held that the appellant had made a prima facie case for waiver of pre-deposit of the amounts involved, granting a stay on recovery until the appeals were disposed of.

In conclusion, the Tribunal allowed the stay petitions, finding in favor of the appellant regarding the service tax liability on the transportation of goods. The Tribunal emphasized that the demand for service tax on services received from truck owners or goods transport operators as 'Goods Transport Agency' services was not valid. The appellant's argument was supported by the Budget Speech and previous judgments, leading to the waiver of pre-deposit of the dues adjudged by the lower authorities.