2011 (3) TMI 78 - AT - Service Tax

Demand - Business Auxiliary service - Adjudicating Authority confirmed the demands, imposed penalties and sought interest on the amounts confirmed against which these appeals are filed - The dispute involved in this case is undoubtedly the very same issue which has been decided by us in Final Order No.116 to 119/2010 dated 21.12.2010 - The ratio of our judgment in the appellant s own case is to be seen from paragraph 10 onwards and to reach conclusion we had considered the entire factual matrix like the tender document floated by the appellant and the terms and conditions of the contracts and the statutory provisions - The issue is already decided in favour of the assessee in our Final Order No.116 to 119/2010 dated 21.12.2010 - Appeal is allowed

Summary

Issues:
Interpretation of service tax liability for a Kerala State Government undertaking engaged in liquor procurement and distribution.

Analysis:
The judgment by the Appellate Tribunal CESTAT, Bangalore dealt with appeals against Orders-in-Original related to service tax liability dated 31.3.2010. The appellants, a Kerala State Government undertaking, were involved in the procurement and distribution of liquor in the State of Kerala. The revenue alleged that the appellants had not discharged their service tax liability on services rendered as a consignee for onward sale. The Adjudicating Authority confirmed the demand, stating that the appellants provided Business Auxiliary Services and were taxable from 1.7.2003 based on charges like service charges, display charges, profit margin, etc., supported by investigation statements. The appellants argued that a previous order by the same Bench favored them, emphasizing that the transactions did not involve sales. The revenue cited judgments supporting their stance, highlighting the absence of sales in the transactions. The appellants countered, referring to a High Court order where it was held that no sale was involved.

The Tribunal considered all submissions and records, noting that the issue was previously decided in favor of the assessee in a similar case. They analyzed the factual matrix, tender documents, contract terms, and statutory provisions to conclude that the appellants' activities were akin to trading and constituted a sale of liquor, not services to distilleries. The Tribunal upheld their earlier decision and set aside the impugned orders, allowing the appeals. The judgment emphasized the need to follow the ratio of the earlier case in the current appeals due to the similarity in issues and factual findings.