2013 (9) TMI 322 - AT - Service Tax

Service tax demand Goods Transport Service section 65(105)(zzp) - The case of the appellant is that the individual transporters who did not issue any consignment note for transportation of the goods cannot be called Goods Transport Agencies and therefore the appellant should not be held liable to pay any amount of service tax under the head GTA service under Section 65(105) (zzp) of the Finance Act 1994 read with Section 65 (50b) of the Act. - Held that - Prima facie case is in favor of assessee - stay granted.

Summary

Issues:
- Applicability of service tax on amounts paid to individual transporters for procuring raw material.
- Interpretation of Rule 2(1)(d)(v) of the Service Tax Rules 1994.
- Classification of individual transporters as "Goods Transport Agencies."
- Precedents supporting waiver and stay in similar cases.

Analysis:

The judgment addresses the issue of whether the appellant, a sugar manufacturer, is liable to pay service tax on amounts paid to individual transporters for procuring raw material. The appellant argued that the individual transporters, who did not issue consignment notes, should not be classified as "Goods Transport Agencies," thus exempting the appellant from the service tax liability under relevant sections of the Finance Act 1994. The appellant relied on judicial precedents, including a Stay Order in a similar case, to support their position.

The Tribunal considered the submissions and found that the judicial precedents cited by the appellant were prima facie applicable to the facts of the case. Notably, no binding precedent to the contrary was presented. Consequently, the Tribunal granted waiver and stay as requested by the appellant. The order included a waiver of pre-deposit and a stay of recovery concerning the adjudged dues until the final disposal of the appeal.

In conclusion, the judgment underscores the importance of judicial precedents in determining liability for service tax and the significance of establishing the classification of entities under relevant tax provisions. The decision to grant waiver and stay was based on the absence of conflicting precedents and the applicability of the cited cases to the current scenario.