2011 (1) TMI 701 - AT - Service Tax

Waiver of the pre-deposit - Business Auxiliary Services - the definition of Business Auxiliary Services during the period 10.9.2004 to 28.2.2005 (relevant period in the present case) was indicating about the services rendered production of goods on behalf of the client , while the amended definition of 16.6.2005 indicated production of goods for or on behalf of the clients - appellant has made out a prima facie case for waiver of the pre-deposit of the amounts involved - Appeal is allowed

Summary

Issues:
Stay petition for waiver of pre-deposit of service tax, interest, and penalties under different sections of the Finance Act, 1994 based on the definition of "Business Auxiliary Services."

Analysis:

The appellant filed a stay petition seeking waiver of pre-deposit of confirmed amounts including service tax, interest, and penalties under various sections of the Finance Act, 1994. The Adjudicating Authority and the Commissioner (A) upheld the amounts due to the appellant providing "Business Auxiliary Services" by producing goods on behalf of clients. The appellant's representative highlighted the definition of BAS, emphasizing that the appellant produced goods through a heat treatment process. Reference was made to a similar case in Chennai where unconditional stay was granted as the period was before the amendment of the BAS definition. The learned DR reiterated the lower authorities' findings.

Upon careful consideration, the Tribunal noted that during the relevant period in this case, the definition of "Business Auxiliary Services" referred to "production of goods on behalf of the client." However, the amended definition stated "production of goods for or on behalf of the clients." Citing the precedent of a coordinate bench in a similar case, the Tribunal found merit in the appellant's argument. It was observed that the appellant had a prima facie case for waiver of the pre-deposit amounts. Consequently, the application for waiver was allowed, and recovery stayed pending the appeal's disposal.

Overall, the Tribunal granted the appellant's request for waiver of pre-deposit based on the interpretation of the definition of "Business Auxiliary Services" during the relevant period, aligning with the decision of a coordinate bench in a similar case.