2013 (11) TMI 605 - AT - Service Tax

Stay application - Goods Transport Agency service - Held that - During the relevant period amounts was paid by the petitioner towards goods transport agency services in respect of goods transported to Vishakhapatnam port for eventual export. In respect of such transactions the statutory provision operative at the relevant period enjoined that the recipient of the goods transport agency service should remit the service tax and thereafter could claim refund of the service tax remitted, since the service was in relation to export of goods. However, the petitioner failed to remit the service tax and thus had contravened the obligations under the provisions of the Act and for no stated reasons - Prima facie case not in favour of assessee - Stay not granted.

Summary

Issues:
1. Stay application infructuous - Dismissal of misc. application.
2. Waiver of pre-deposit and stay of further proceedings requested.
3. Failure to disclose service tax liability on GTA services.
4. Contravention of obligations under the Act regarding service tax remittance.
5. Justification for invoking extended period of limitation.
6. Granting waiver of pre-deposit and stay of further proceedings.

Analysis:

1. The judgment begins by addressing a miscellaneous application for early hearing of a stay application, which is dismissed as the stay application has been disposed of, rendering the misc. application infructuous.

2. The appellant, a manufacturer of iron and steel products, seeks waiver of pre-deposit and stay of further proceedings following an adjudication order dated 25.10.2012.

3. The appellant was audited for the period October 2005 to September 2007, revealing a failure to disclose the amount paid to Goods Transport Agencies (GTAs) in the ST-3 returns, leading to a service tax liability. A Show Cause Notice was issued on 18.10.2011 alleging non-remittance of service tax with intention to evade payment.

4. The appellant failed to remit service tax on amounts paid for GTA services related to goods transported for export, contravening statutory provisions. The adjudication order determined a service tax liability along with interest and penalties under relevant sections of the Act.

5. The appellant argues against invoking the extended period of limitation, contending that the liability was revealed during the audit. However, the Tribunal finds the justification for invoking the extended period valid based on the factual matrix and consistent allegations in the audit report and Show Cause Notice.

6. The Tribunal decides not to grant full waiver of pre-deposit, highlighting the appellant's entitlement to a service tax refund after remittance. The matter of imposing penalties will be considered at the final hearing. The Tribunal grants waiver of pre-deposit and stay of further proceedings on the condition that the appellant remits the assessed service tax and interest within a specified period, failing which the stay will be dissolved.

This detailed analysis of the judgment covers the issues involved and the Tribunal's decision on each aspect of the case.