2013 (10) TMI 92 - AT - Service Tax

Demand - Cargo Handling Service - Held that - applicant were acting as Goods Transport Agency issuing consignment note is being presented for the first time. No evidence to prove this contention has been placed either before the adjudicating authority or the Commissioner (Appeals). - if the appellant are to be treated as a provider of cargo handling service, they are eligible for cenvat credit. However, it is not clear whether goods transport service was on which freight was paid was used for providing cargo handling service. On this issue also, there is no factual submissions before the lower authorities. Thus the facts relevant for deciding tax liability are not very clear. Since the applicant has not been able to put forth their facts and contentions before lower authorities in a proper manner, stay granted partly.

Issues:
1. Whether the appellant provided 'Cargo Handling Service' and received services of Goods Transport Operators without paying service tax.
2. Whether the appellant is eligible for Cenvat credit on the services provided and received.
3. Validity of the demand of service tax on the appellant.

Analysis:
1. The case against the appellant was that they provided 'Cargo Handling Service' and received services of Goods Transport Operators without paying service tax. The demand for service tax of Rs.85,238/- was confirmed in the adjudication order, upheld by the Commissioner (Appeals). The appellant argued that they were providing a composite service of transportation and handling of cargo, with transportation being the predominant nature of the service. The Revenue argued that the appellant was providing both cargo handling service and receiving goods transport service, based on the Managing Director's statement. The Tribunal noted that the appellant had not provided evidence to prove they were acting as a Goods Transport Agency issuing consignment notes. However, it acknowledged the argument that if the appellant were treated as a provider of cargo handling service, they would be eligible for Cenvat credit.

2. The appellant contended that if they were considered providers of cargo handling service, they should be eligible for Cenvat credit on the services received. The Tribunal found merit in this argument but noted that the facts regarding whether the goods transport service, on which freight was paid, was used for providing cargo handling service were not clear. As the appellant had not presented their facts and contentions properly before the lower authorities, the Tribunal directed the appellant to make a pre-deposit of Rs.15,000 for admission of appeal. The pre-deposit of the balance dues was waived for the admission of the appeal, with its collection stayed during the appeal's pendency.

3. The Tribunal considered the submissions from both sides and found that the factual submissions relevant for deciding the tax liability were not clear. It noted that the appellant had not been able to present their contentions adequately before the lower authorities. Therefore, the Tribunal directed the appellant to make a pre-deposit for admission of the appeal, with the balance dues waived subject to this deposit and its collection stayed during the appeal's pendency. Compliance with the order was required to be reported by a specified date.

This detailed analysis outlines the key arguments presented by both parties, the Tribunal's assessment of the evidence and legal provisions, and the decision regarding the demand for service tax and eligibility for Cenvat credit in the given case.

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