2014 (4) TMI 289 - AT - Service Tax

Waiver of pre-deposit - Business auxiliary services, business support services, IT services - Held that - The appellant is undertaking the verification of digital signatures of the service provider and forwarding the said various authorities to confirm the user as a genuine person and E-commerce transactions entered into with the entity. It is to be seen that the entire issue of whether the services rendered would be taxable or not needs a detailed analysis in as much as, the deliberation of the Ld. Counsel trying to equate the activities done by him, does not fall under any of the service category based upon CBC letter no.137/76/2008-CX4 dt. 04.06.2008 needs to be understood in its correct perspective. Prima facie it is seen that the appellant is not providing the services as mentioned of verification of the individuals / organization to any certifying authority could be given and he doing for someone situated abroad; at the same time, it has to be kept in mind that the appellant is eligible for availing Cenvat Credit of service tax by him under the reverse charge mechanism and utilize the same for payment of services tax if any. In sum, we are of the view that the appellant needs to be put to some conditions for hearing and disposing of the appeals as the issue is arguable - stay granted partly.

Summary

Issues: Stay petitions for waiver of pre-deposit of service tax liability, interest, and penalties under various sections.

In the judgment delivered by the Appellate Tribunal CESTAT AHMEDABAD, the issue at hand was the waiver of pre-deposit of amounts confirmed against the appellant as service tax liability, interest, and penalties under various sections. The Tribunal, comprising M V Ravindran and H K Thakur, JJ., considered the appellant's service tax liability confirmed under different heads such as business auxiliary services, business support services, and IT services. The appellant's activities involved the verification of digital signatures of service providers and forwarding the information to authorities to confirm the legitimacy of users and E-commerce transactions. The Tribunal noted that the appellant's services did not fall under any specific service category based on a CBC letter. However, the appellant was eligible for availing Cenvat Credit of service tax under the reverse charge mechanism. The Tribunal found the issue to be arguable and directed the appellant to deposit Rs.2,00,000 within eight weeks for hearing and disposal of the appeals. Compliance was to be reported before the Dy. Registrar, who would then present the file for further orders. The Tribunal allowed the applications for waiver of pre-deposit of balance amounts, staying the recovery until the appeals were disposed of. The judgment emphasized the need for detailed analysis and consideration of the appellant's services in the context of service tax liability, highlighting the importance of compliance and procedural steps for the resolution of the appeals.