2013 (10) TMI 1271 - AT - Service Tax

Business Support Service Waiver of pre-deposit - The appellant is providing translation service to the customers Held that - Similar issue came up in 2013 (10) TMI 1239 - CESTAT BANGALORE - From the definition, it can be seen that applying the principle of ejusdem generis, the transaction processing has to be considered along with the other terms used and when that is taken into account, translation work undertaken by the appellant cannot be covered by the definition - prima facie the demand was within normal period of limitation - the appellant is directed to deposit an amount of Rs.7,00,000 upon such submission rest of the duty to be waived till the disposal Partial stay granted.

Summary

Issues:
1. Classification of translation service as Business Support Service (BSS) for service tax liability.

Analysis:
The judgment by the Appellate Tribunal CESTAT BANGALORE revolves around the classification of the appellant's translation service for service tax purposes. The appellant was providing translation services to customers, and the Revenue contended that this service fell under Business Support Service (BSS), resulting in a demand for over Rs.58 lakhs in service tax along with interest and penalties. The appellant argued that the Revenue had mischaracterized their activity as transaction processing, leading to the incorrect application of service tax under the BSS category. The appellant's counsel invoked the principle of ejusdem generis to argue that transaction processing should be interpreted in conjunction with other terms, indicating that the translation work undertaken did not fall within the BSS definition.

The learned AR referenced a previous Tribunal case involving a similar issue, where a pre-deposit was ordered. It was noted that a prima facie view suggested that a demand within the normal limitation period might be sustainable, with an estimated amount of around Rs.7 lakhs. Considering the arguments presented, the Tribunal directed the appellant to deposit Rs.7,00,000 within six weeks and report compliance by a specified date. Upon compliance, there would be a waiver of pre-deposit and a stay against the recovery of the remaining dues during the appeal's pendency. The judgment emphasizes the importance of proper classification for service tax liability and the procedural steps to be followed in such cases.

This detailed analysis of the judgment showcases the legal intricacies involved in determining the classification of services for tax purposes and the Tribunal's approach to addressing such disputes.