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2011 (2) TMI 671 - AT - Service TaxDemand - GTA services - There is no reference to Section 70 (the provision under which service providers are required to file returns) or to Section 71A (the provision under which service recipients, like the present assessees, are required to file returns) in this text - There was no mention of Section 71A in the text of Section 73 of the Finance Act, 1994 right from the beginning - It is settled law that nothing can be added to a statute, nor can anything be deleted therefrom, by a court, whose function it is to interpret the expressions as they exist in the statute - appeals are allowed
Issues:
1. Liability of assessees for service tax on goods transport operator's service. 2. Interpretation of relevant provisions of the Finance Act, 1994. 3. Applicability of previous judgments in similar cases. Analysis: Issue 1: Liability of assessees for service tax on goods transport operator's service The appeals involved assessees engaged in manufacturing excisable products who availed goods transport operator's service but did not pay service tax or file service tax returns. The department issued show-cause notices demanding service tax, interest, and penalties. The original authority confirmed the demands and imposed penalties. The Commissioner (Appeals) upheld the orders in some cases and granted relief in others. The assessees' appeals were based on the argument that they were not liable to pay service tax as recipients of GTO service. The Revenue's appeals contested the relief granted to some assessees. Issue 2: Interpretation of relevant provisions of the Finance Act, 1994 The substantive issue revolved around the interpretation of Section 73 of the Finance Act, 1994, and whether recipients of GTO service were liable to file returns under Section 71A. The assessees relied on the Tribunal's decision in L.H. Sugar Factories case, affirmed by the Apex Court, to support their position. The Revenue argued for following the Gujarat Ambuja Cements case, contending that the legislative intent authorized recovery of service tax from both service providers and recipients. The Tribunal analyzed the legislative intent behind the provisions and concluded that the assessees were not liable under Section 73 prior to September 2004. Issue 3: Applicability of previous judgments in similar cases The Tribunal compared previous judgments like L.H. Sugar Factories, Gujarat Ambuja Cements, Mangalam Cements, and Agauta Sugar & Chemicals to determine the correct interpretation of the law. It noted that the legislative changes in 2004 made Section 73 applicable to both categories of assessees, but these changes were not relevant to cases where show-cause notices were issued before September 2004. The Tribunal emphasized the need for strict construction of statutory provisions and concluded that the issue in these cases favored the assessees based on the L.H. Sugar Factories judgment. In summary, the Tribunal held in favor of the assessees, dismissing the Revenue's appeals and allowing the assessees' appeals based on the interpretation of Section 73 of the Finance Act, 1994. The Tribunal's decision aligned with the precedent set by the L.H. Sugar Factories case, affirming that recipients of GTO service were not liable to pay service tax under Section 73 before September 2004.
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