2014 (7) TMI 75 - AT - Service Tax

Waiver of pre-deposit of Service Tax - appreciation of evidences - demand of service tax on the basis of figure shown as other income in the profit and loss account - difference with ST-3 return - demand on GTA Service - Held that - It is the claim of the department that the Applicant though pleaded before the adjudicating authority that they were carrying out the activity of sale of LPG, as well as rendering the services of bottling of LPG for M/s.HPCL, but could not establish the same through evidences. On the other hand, it is the grievance of the Appellant that the sales and other income figures are self-explanatory, as mentioned in the respective Balance sheet and though they could place the VAT payment challans, VAT Audit Report but due to internal family dispute, could not produce the VAT Returns filed with State VAT department and other corroborative evidences, in support of sale of LPG. We find that the case relates to scrutiny of evidences, in arriving at a conclusion that the Appellant are rendering services of bottling LPG as well as carrying out the activity of sales of LPG. Appellant even though produced VAT audit report etc., but other documents like VAT returns, sales and purchase of LPG etc., could not be produced before the Ld.Commissioner to establish sale of LPG because of internal disputes in the management of factory. Similarly, in the case of Service Tax liability on GTA Service, we find that the documents indicating the claim of payment of Service Tax by GTA service provider had not been verified/scrutinized by the adjudicating authority. In these circumstances, we are of the view that the Appellant be given an opportunity to place all necessary evidences in support of their claim that they were carrying out the activity of sales as well as rendering services to M/s.HPCL and also the claim of payment of Service Tax on GTA service by the respective GTA service provider. In the result the impugned order is set aside and the matter is remitted to the Ld. adjudicating authority to decide all the issues afresh - Decided in favour of assessee.

Summary

Issues involved: Application seeking waiver of pre-deposit of Service Tax, penalty under Section 78, penalties under other provisions of the Finance Act, 1994. Dispute regarding sales figures, other income related to bottling of LPG, VAT returns, Service Tax on GTA service.

Analysis:

The judgment pertains to an Application for waiver of pre-deposit of Service Tax, penalty, and other penalties. The Appellant, engaged in bottling LPG for an oil company, faced a demand notice considering sales figures and 'other income' related to bottling of LPG for Service Tax calculation. The Appellant claimed that the sales figures and 'other income' were distinct, with VAT paid on sales. However, due to internal disputes, they couldn't present VAT returns. The Ld.Sr.Advocate argued that Service Tax on GTA service was not paid as the GTA service provider had already paid and billed for it. Invoices supporting this claim were provided.

The Revenue contended that without VAT returns and purchase/sales invoices, the Appellant's activities couldn't be proven. The case was considered for final disposal after waiving the pre-deposit requirement. The main issue was the lack of evidence to establish the Appellant's activities conclusively. The department claimed the Appellant failed to prove sales and bottling services, while the Appellant argued that their financial records were self-explanatory. However, due to internal disputes, crucial documents like VAT returns were unavailable. The judgment emphasized the need for proper evidence to support the Appellant's claims.

The Tribunal found that the case required a detailed examination of evidence to determine if the Appellant indeed provided bottling services and engaged in LPG sales. Due to the unavailability of key documents like VAT returns and insufficient verification of GTA service tax payment, the matter was remitted to the adjudicating authority for a fresh decision. The judgment clarified that no opinion was expressed on the issues, leaving them open for further examination. The Appellant was granted an opportunity to present all necessary evidence, ensuring a fair hearing. The Appeal was allowed by way of remand, and the Stay Petition was disposed of.