2014 (12) TMI 704 - AT - Service Tax

Waiver of pre deposit - Rent-a-Cab-Service - Held that - The hon ble Punjab & Haryana High Court as well as the Madras High Court and this tribunal in a series of decisions 2013 (6) TMI 607 - CESTAT MUMBAI , 2010 (4) TMI 283 - PUNJAB & HARYANA HIGH COURT and 2001 (4) TMI 7 - HIGH COURT MADRAS have been consistently following the classification of renting or hiring of bus/cabs services under the category of rent-a-cab services . We do not find any changes made in the law necessitating a new classification. The new service of supply of tangible goods for use has not been carved out of rent-a-cab service . In this factual and legal position, the impugned demand classifying the service under the category of supply of tangible goods for use service is not prima facie sustainable in law. Thus, the appellant has made out a case for grant of stay. Accordingly, we grant unconditional waiver from pre-deposit of the dues adjudged against the appellant and stay recovery thereof during the pendency of the appeal. - Stay granted.

Summary

Issues Involved:
Classification of service tax demand under 'supply of tangible goods service' instead of 'Rent-a-Cab-Service'.

Analysis:
The judgment pertains to an appeal against an Order-in-Original passed by the Commissioner Central Excise and Service Tax Pune-III, confirming a service tax demand of Rs. 1,19,26,341 along with interest and penalties against the appellant, a company engaged in renting and hiring of cars/buses to transport corporations. The appellant contended that previous tribunal decisions and high court rulings classified such services under 'Rent-a-Cab-Service,' not 'supply of tangible goods for use.' The Revenue argued that a new taxable service entry was created during the relevant period, making 'supply of tangible goods for use' more specific and thus justifying the demand. However, the tribunal noted that previous decisions consistently classified renting or hiring of buses/cabs under 'rent-a-cab services,' and no new classification for 'supply of tangible goods for use' was established. Consequently, the tribunal found the demand under the latter category not prima facie sustainable in law, leading to the grant of unconditional waiver from pre-deposit and stay on recovery during the appeal's pendency.