2009 (8) TMI 91 - AT - Service Tax

SSP / Small Service Provider Exemption - DSA promotion or marketing of banking service the value of taxable service held that - Commissioner (Appeals) has observed that even if the appellant s activities are held to be taxable under Business Auxiliary Service , they would still be not liable to pay any service tax in terms of Notification No.6/2005-ST. While dealing with the above contention of the Commissioner (Appeals), Revenue has submitted that the plea of availability of notification was not taken by the assessee before the original adjudicating authority, and as such, the Commissioner (Appeals) was not justified extending the benefit of the same to the appellant the contention of the revenue can not be accepted - Merely because the assessee did not claim the same before the original adjudicating authority and raised the issue for the first time before Commissioner (Appeals), cannot be held to be a ground of denying the benefit of the notification, if the same is otherwise available

Summary

Issues:
1. Eligibility for exemption under Notification No.6/2005-ST.
2. Claiming notification benefits at different stages of the appeal process.

Eligibility for exemption under Notification No.6/2005-ST:
The case involved a dispute regarding the appellants' eligibility for exemption under Notification No.6/2005-ST, which exempted service tax when the value of taxable service did not exceed Rs.4,00,000 in the preceding financial year. The Commissioner (Appeals) found that the services provided by the appellants fell under "Business Auxiliary Service." The Department quantified the aggregated value of services at Rs.1,98,543, which was below the exemption limit. The Revenue contended that the appellants were liable to pay service tax, but the Commissioner (Appeals) held that even if the services were taxable, the appellants were not liable to pay tax due to the exemption. The Revenue argued that the appellants did not raise the plea of the notification before the original adjudicating authority, questioning the Commissioner (Appeals) extending the benefit of the exemption. The Tribunal rejected the Revenue's contention, stating that claiming the notification was a legal plea that could be raised at the appeal stage. The Tribunal emphasized that the availability of the notification was not disputed, and the appellants were entitled to the exemption. Therefore, the Tribunal found no merit in the Revenue's appeal and rejected it.

Claiming notification benefits at different stages of the appeal process:
The Tribunal addressed the issue of claiming notification benefits at different stages of the appeal process. It emphasized that the benefit of a notification, if available, could be raised for the first time during the appeal, even if not claimed before the original adjudicating authority. The Tribunal clarified that the failure to claim the notification earlier did not justify denying its benefit, especially if the benefit was otherwise available to the assessee. In this case, since there was no dispute about the availability of the notification, the Tribunal rejected the Revenue's appeal, affirming the appellants' eligibility for the exemption under Notification No.6/2005-ST. The Tribunal's decision highlighted the importance of legal pleas and entitlements being considered at different stages of the appeal process, ensuring that rightful exemptions are granted based on the applicable laws and notifications.