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2014 (12) TMI 1133 - AT - Service TaxWaiver of pre deposit - Site clearance and preparation service - Held that - Appellant had sub-contracted the entire contract on a back-to-back basis to another contractor who executed the work and demand has been raised against the contractor who executed the work also. In view of the fact that the appellant had not executed the work and demand has been raised against the contractor who did the work, we consider that the appellant has made out a case for waiver - Stay granted. Works contract service - Held that - unless the procedure as prescribed under the relevant rules is followed, according to which the appellant was required to opt for composition scheme before making the payment of tax, they cannot avail the benefit. Under these circumstances, the claim for composition scheme may not be admissible to appellants at all. Hence, we find that appellant has not made out a case for waiver in respect of this amount. No financial difficulty has been pleaded. - Partial stay granted.
Issues:
Demand for Service Tax, Sub-contracting of work, Works contract service, Composition scheme benefit. Analysis: The judgment addresses the demand for Service Tax amounting to &8377; 2,43,11,985/- along with penalties imposed on the appellant. The Tribunal considers the appellant's case for waiver concerning specific services. For the demand related to "site clearance and preparation service" and "erection commissioning or installation services," the appellant had sub-contracted the work to another contractor on a back-to-back basis. As the demand was raised against the contractor who executed the work, the Tribunal finds in favor of the appellant for waiver in these instances. However, for the demand of &8377; 30,35,069/- for "works contract service," the appellant's claim for waiver is not accepted entirely. The appellant argued that a portion of this amount related to a period when works contract as a service was not taxable, and the composition benefit was not extended. The Tribunal rules that the appellant failed to follow the prescribed procedure to opt for the composition scheme, making the claim inadmissible. Therefore, the appellant is directed to deposit &8377; 20,00,000/- within six weeks, with a waiver of pre-deposit and stay against recovery of the balance dues upon compliance. This judgment highlights the importance of following the prescribed procedures, especially concerning tax schemes like the composition scheme. It emphasizes that financial difficulty alone may not be sufficient to warrant a waiver of tax liabilities. The Tribunal's decision underscores the need for strict adherence to legal requirements and timelines in availing benefits or waivers under tax laws. The case serves as a reminder for taxpayers to ensure compliance with all relevant regulations to avoid facing additional penalties or demands for payment.
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