2015 (2) TMI 309 - AT - Service Tax

Waiver of pre-deposit of Service Tax - denial of the benefit of Notification No.12/2003-ST dated 20.06.2003 - Held that - While confirming the demand the benefit of Notification No.12/2003-ST dated 20.06.2003 was not allowed by the learned adjudicating authority on the ground that the Appellant had failed to provide documentary proof in respect of the goods sold in the execution of contract covered under the show cause notice. The Ld. Consultant has fairly admitted that at the time of adjudication, the assessed VAT returns were not in their possession which they received after the adjudication order was passed. It is also their grievance that while rejecting the VAT Returns, the Ld. Commissioner has not given them an opportunity to explain the entries reflected in the said VAT returns, but arrived at the conclusion unilaterally in confirming the demand. Similar kind of grievance is also advanced in respect of the demand confirmed in relation to service of laying down of roads and Railway lines. Both sides agree that the Appellant be given a fair chance to place all evidences in support of their claims before the adjudicating authority and the issues be decided afresh on the basis of the evidences. Thus, in the interest of justice we set aside the impugned order and remit the case to the learned adjudicating authority for deciding the issues afresh after considering all evidences on record and the evidences that would be produced by the Appellant during the course of adjudication proceeding. - Matter remanded back - Decided in favour of assessee.

Summary

Issues: Application for waiver of pre-deposit of Service Tax and penalty under Sections 78 and 77 of the Finance Act, 1994.

Analysis:
1. The appellant sought waiver of pre-deposit of Service Tax amounting to Rs. 2.44 Crores and an equal penalty under Sections 78 and Rs. 10,000 under Section 77 of the Finance Act, 1994. The consultant for the appellant argued that a portion of the demand was confirmed, denying the benefit of a specific notification, while the remaining amount was confirmed rejecting the claim that services provided were exempt from Service Tax due to construction of roads and railways.

2. The consultant contended that the adjudicating authority did not accept the evidence submitted by the appellant to establish that no Service Tax was payable on the value of materials supplied along with services. The appellant had submitted VAT Returns to show the sale of materials along with services, but VAT assessment orders were not available during adjudication. The consultant argued that discrepancies were not explained, violating the principle of natural justice. The appellant requested a chance to present VAT assessment orders and other evidence to support their claims.

3. The Revenue's representative supported the Commissioner's findings and noted that assessed VAT returns were not presented during the initial proceedings. The representative did not object to remanding the case for a fresh consideration by the Commissioner.

4. The Tribunal decided to dispose of the appeal without the need for pre-deposit, allowing both parties to proceed with the appeal. It was observed that the benefit of a specific notification was not allowed due to lack of documentary proof of goods sold. The Tribunal acknowledged the appellant's lack of VAT returns during adjudication and agreed that the case should be remitted to the adjudicating authority for a fresh decision based on all evidence presented.

5. The Tribunal set aside the previous order and remanded the case for a fresh decision, emphasizing the need for a fair opportunity for the appellant to present all evidence. The issues were to be reconsidered based on the new evidence, ensuring a reasonable opportunity for the appellant to be heard. The appeal was allowed by way of remand, and the stay petition was disposed of accordingly.