2010 (11) TMI 437 - AT - Service Tax

Remand order - Consultant or Sub-consultant - The specific direction of the Tribunal was for limited purpose of checking the factual position whether the main consultant has discharged service tax liability on the entire amount - the Bench had clearly recorded a finding that the appellant being a sub-consultant - Impugned de novo orders concluding that appellant was a consultant - Both the lower authorities have come to the conclusion that the appellant is consultant to say that the lower authorities cannot take a different view than the view expressed by the Tribunal unless the order of the Tribunal is stayed or set aside - The considered view that both the lower authorities have erred in passing the orders which are beyond the scope of the remand order - Set aside the impugned orders and allow the appeal filed by the assessee

Summary

Issues:
1. Stay petition for waiver of pre-deposit of service tax amount confirmed by Adjudicating Authority.
2. Dispute regarding service tax liability of the appellant as a sub-consultant.
3. Alleged failure of lower authorities to follow Tribunal's remand order.

Analysis:

Issue 1:
The stay petition was filed seeking waiver of pre-deposit of the service tax amount confirmed by the Adjudicating Authority, which was upheld by the first appellate authority. The Tribunal found the issue to be narrow and decided to dispose of the appeal itself after allowing the application for waiver of pre-deposit.

Issue 2:
The appellant, providing consulting engineer services, failed to discharge service tax on services realized from a specific entity. Despite contentions that the main consultant had discharged the tax liability, the Adjudicating Authority and the Commissioner (Appeals) confirmed the demand and penalties. The Tribunal had previously determined the appellant as a sub-consultant and remanded the matter to ascertain if the main consultant had paid the tax. However, the lower authorities went beyond the remand order, leading to an appeal. The Tribunal reiterated the appellant's status as a sub-consultant and highlighted the non-requirement of service tax payment if the main consultant had discharged it, citing relevant Board circulars and trade notices. The Tribunal found errors in the lower authorities' decisions and allowed the appeal, emphasizing adherence to the Tribunal's findings.

Issue 3:
The Tribunal observed that the lower authorities deviated from the Tribunal's remand order by reaching a different conclusion regarding the appellant's status as a sub-consultant. As the previous Tribunal order had not been appealed against and had become final, the lower authorities were not permitted to diverge from its findings. Consequently, the Tribunal set aside the impugned orders, allowing the appellant's appeal and disposing of the stay petition.

In conclusion, the Tribunal's judgment addressed the stay petition for pre-deposit waiver, the dispute over the appellant's service tax liability as a sub-consultant, and the lower authorities' failure to adhere to the Tribunal's remand order. The decision emphasized the binding nature of Tribunal findings and rectified errors made by the lower authorities, ultimately allowing the appellant's appeal with consequential relief.