2013 (9) TMI 591 - AT - Service Tax

Valuation - port services - gross amount - Appellant is charging less amount from M/s. Hindalco Industries for utilising the machinery which has been erected by them at Dahej Harbour/ Port This charging of less amount is due to the fact that M/s. Hindalco Industries Limited had installed their own machineries which are being used by the appellant for rendering the said services. It is his submission that the issue is of inclusion of differential amount not charged by the appellant on M/s. Hindalco Industries Limited for the purpose of discharge of service tax liability. Held that - Entire issue revolves around the definition of the amount gross value charged, which has already been decided by the Hon ble High Court of Delhi in the case of Intercontinental Consultants and Technocrats Pvt. Limited 2012 (12) TMI 150 - DELHI HIGH COURT , wherein it is held that - Appellant has made out a strong prima facie case for the waiver of pre-deposit of the amounts involved stay granted.

Summary

Issues:
1. Waiver of pre-deposit of service tax, interest, and penalties.
2. Differential amount charged for port services.
3. Correct value for service tax liability.

Analysis:
1. The appellant filed a stay petition seeking the waiver of pre-deposit of service tax, interest, and penalties imposed on them. The issue revolved around the appellant's liability to discharge service tax on the differential amount charged for providing port services. The appellant contended that charging less from a specific recipient was due to the recipient providing their machinery for the services. Reference was made to relevant judgments to support the appellant's case.

2. The departmental representative argued that the concession given to a particular recipient indicated additional benefits provided to them due to the machinery they supplied. Citing a tribunal judgment in a similar case, the representative emphasized the need for the appellant to deposit some amount. The tribunal analyzed the submissions and records to determine the correct value for service tax liability concerning the differential amount charged from a specific recipient for utilizing their machinery at the port.

3. The tribunal referred to a judgment of the Hon'ble High Court of Delhi to establish the correct valuation principles for taxable services. The court's ruling emphasized that only the consideration paid for the service should be brought to charge, excluding additional costs incurred by the service provider. The tribunal found that the issue at hand aligned with the Delhi High Court's decision, indicating that the appellant had a strong prima facie case for the waiver of pre-deposit. Consequently, the tribunal allowed the application for the waiver of pre-deposit until the appeal's disposal.

This detailed analysis of the judgment highlights the key issues of waiver of pre-deposit, differential amount charged for port services, and the correct value for service tax liability, providing a comprehensive understanding of the legal proceedings and decisions made by the Appellate Tribunal CESTAT AHMEDABAD.