2008 (12) TMI 142 - AT - Service Tax

Respondents availed the services of truck owners and truck operators for transportation of the inputs into their factory - O-I-A allowing abatement under Notification No. 1/2006-S.T. - Revenue stated that the relief given by the Commissioner (A) is only to the extent of the demand of differential Service tax and not the refund of Service tax already paid - No any justification for staying the impugned orders of the Commissioner (A) - However, considering the high revenue implication, we order early hearing of the cases

Summary

Issues:
1. Appeal against Order-in-Appeal No. 4 & 5/2008 dated 20-2-2008 passed by the Commissioner of Central Excise & Customs (A), Guntur.
2. Availment of services of truck owners and operators for transportation of inputs into the factory.
3. Liability to pay Service tax under Notification No. 32/2000-S.T., dated 3-12-2004 and Notification No. 1/2006-S.T., dated 1-3-2006.
4. Demand of differential duty to the extent of 75%.
5. Relief granted by the Commissioner (A) limited to the demand of differential Service tax.
6. Entitlement to refund of Service tax already paid.
7. Early hearing of cases due to high revenue implication and contentious points.
8. Decision on staying the impugned orders.

Analysis:

1. The appeal was filed against the Order-in-Appeal No. 4 & 5/2008 dated 20-2-2008 by the Commissioner of Central Excise & Customs (A), Guntur. The issue revolved around the utilization of truck services for transporting inputs to the factory. The appellant argued that they mistakenly discharged their Service tax liability under specific Notifications, while the Revenue contended that the appellant was not eligible for the benefits under these Notifications, leading to demands for a 75% differential duty.

2. The Commissioner (A) set aside the Orders-in-Original, granting relief limited to the demand of the differential Service tax, not the refund of the tax already paid by the appellant. The appellant, represented by an advocate, relied on the Finance Minister's speech to support their position that they were not liable for any Service tax payment and should be entitled to a refund. On the contrary, the JCDR argued against granting any refund, stating that the appellant had voluntarily paid the Service tax and should not be eligible for a refund.

3. After careful consideration, the Tribunal found insufficient justification to stay the impugned orders of the Commissioner (A). However, due to the significant revenue implications and the contentious arguments from both sides, the Tribunal ordered an early hearing of the cases on 25th February 2009. The appellant's advocate agreed not to press for a refund of the taxes already paid until the appeals were disposed of, leading to the rejection of the stay applications.

4. The decision to reject the stay applications indicated the Tribunal's stance on the issue, emphasizing the need for early resolution due to the financial impact and the conflicting positions presented by the appellant and the Revenue. The Tribunal's order for early hearing aimed to address the complex legal and factual aspects of the case promptly, ensuring a fair and efficient resolution while maintaining the status quo regarding the refund of taxes paid by the appellant.