2013 (12) TMI 328 - AT - Service Tax

Waiver of predeposit of tax - Survey and Exploration of Mineral Services - Assessee contends that it has already discharged the service tax liability hence no demand arises - Held that - prima facie the applicant has undertaken the job of survey and exploration of mineral services. Therefore, they are liable to discharge tax liability. It is seen that one of the sub-contractors M/s. Sri Sai Engineering & Drilling certified that they paid the tax which was not considered by the adjudicating authority - letter dt. 1.8.2013 produced by learned advocate is in respect of discharge of service tax by M/s. Shivani Oil & Gas Exploration Services Ltd. and it cannot be accepted as a discharge of tax liability by the applicant. Ld. advocate also pleaded financial hardships and the applicant-company is suffering from losses and it is also contended that applicant is a proprietorship concern - Assessee directed to make a pre deposit - Partial stay granted.

Summary

Issues:
1. Change of cause title application by Revenue.
2. Application for waiver of predeposit of tax, interest, and penalty.
3. Dispute over tax liability for Survey and Exploration of Mineral Services.
4. Consideration of certificates from main contractors regarding tax payment.
5. Financial hardships and waiver of predeposit amount.

Analysis:
1. The judgment begins by allowing the Revenue's application for a change of cause title, directing the respondent's name to be read as "Commissioner of Service Tax, Chennai" instead of "Commissioner of Central Excise, Chennai-III," thereby addressing a procedural matter.

2. The case involves an application by the assessee for waiver of predeposit of tax amounting to Rs.1,18,39,567/- along with interest and penalty for the period January 2008 to December 2008. The tax was demanded under the category of Survey and Exploration of Mineral Services. Both sides were heard, and the records were examined.

3. The applicant's advocate argued that the main contractors, M/s.Sri Sai Engineering & Drilling and M/s.Shivani Oil and Gas Exploration Services Ltd., had already paid the service tax liability, as evidenced by certificates provided. The advocate contended that the demand was not sustainable due to the main contractors discharging the tax liability. Additionally, there were disputes regarding the classification of services and the limitation for a portion of the demand.

4. The Advocate for the Revenue disputed the applicant's claims, stating that the certificates provided were not supported by sufficient evidence. The Revenue argued that the applicant collected the amount from the contractors, but there was no clear indication that the contractors had paid the tax.

5. After considering the submissions from both sides, the judgment found that the applicant was liable to discharge the tax liability for survey and exploration services. While acknowledging the financial hardships faced by the applicant, the tribunal directed the applicant to deposit Rs.30,00,000 within 8 weeks. Upon such deposit, the predeposit of the balance tax along with interest and penalty was waived, and the recovery was stayed during the appeal's pendency. Compliance was to be reported on 2.12.2013, concluding the judgment.