2014 (8) TMI 544 - AT - Service Tax

Waiver of pre deposit - denial of the benefit of Notification No. 1/2006-S.T., dated 1-3-2006 - abatement to the extent of 75% for payment of Service Tax on the GTA services received by the assessee - Non production of certificate from transporters - Held that - The fact that transporters were not registered with the Service Tax department, should have been sufficient as evidence to show that they are neither availing the Cenvat credit nor the benefit of exemption Notification No. 12/2003. In any case, the appellants have subsequently procured such certificates from the transporters and have produced the same before Commissioner (Appeals) who has ignored the same simply. We find that in view of the subsequent certificates produced by the appellants, the fact of non-availment of Cenvat credit and the benefit of notification stands established. As a consequence, the appellant becomes entitled for the benefit of Notification No. 1/2006-S.T. As such, demand of tax confirmed and penalty imposed upon them cannot be upheld - Decided in favour of assessee.

Summary

Issues:
1. Denial of benefit of Notification No. 1/2006-S.T. to the appellant.
2. Requirement of certificates from transporters for availing abatement.
3. Consideration of certificates by the appellate authority.

Analysis:
The judgment by the Appellate Tribunal CESTAT NEW DELHI addressed the issue of denying the benefit of Notification No. 1/2006-S.T. to the appellant concerning the abatement for payment of Service Tax on GTA services received. The Revenue contended that such abatement is subject to transporters providing certificates confirming no availed modvat credit or benefit of Notification No. 12/2003-S.T. Due to the appellant's inability to produce these certificates, a demand was confirmed against them. The original adjudicating authority and the Commissioner (Appeals) upheld this decision.

The appellant argued that they had submitted GRs issued by transporters to show that these transporters were not registered with the Service Tax department, hence not availing any Cenvat credit or exemption benefits. The appellant later produced certificates from the transporters before the Commissioner (Appeals), which were not considered, leading to the affirmation of lower authorities' orders. The appellant also cited relevant Tribunal decisions to support their case.

Upon review, the Tribunal found that the transporters' non-registration with the Service Tax department should have sufficed as evidence of non-availing of Cenvat credit or exemption benefits. The subsequent submission of certificates by the appellant, ignored by the Commissioner (Appeals), established the non-availing of benefits. Consequently, the appellant was deemed entitled to the Notification No. 1/2006-S.T. benefit, leading to the setting aside of the confirmed tax demand and penalty.

The judgment concluded by allowing the stay petition and the appeal, granting relief to the appellant.