2018 (12) TMI 729 - AT - Service Tax

Liability of Service tax - GTA Service - It is the case of the Revenue that the appellant assessee being one of the seven specified categorized person and having paid freight charges is liable to pay service tax on Transport of Goods by Road Service received - Held that - The amendment that a factory being registered under the State Government as SSI Unit, need not pay Service Tax, being confused them about the non-taxability. However, GTA services were taxable w.e.f. 01.01.2005 - it is also found from the records that the appellants have paid the service tax demand alongwith interest for the period 2011-2012 and also for the period April-June, 2012. The element of fraud or collusion or willful miss-statement or suppression of facts or contravention of any of the provisions with the intent to evade payment of service tax - demand for the extended period is set aside as barred by limitation - penalty also set aside. Appeal allowed - decided in favor of appellant.

Summary

Issues:
Service tax liability for the period related to goods transport services availed by the appellant. Confirmation of demand, imposition of penalties under various sections, and rejection of appeal by lower authorities.

Analysis:
The appellant, registered as an SSI Unit, utilized services from Goods Transport Agencies (GTAs) for the clearance of goods. The dispute arose due to allegations of non-registration with the Service Tax Department and liability to pay service tax on the "Transport of Goods by Road Service" received. The period in question ranged from October 2007 to June 2012. The Adjudicating Authority confirmed a demand of ?1,44,349 for the specified period and imposed penalties under Sections 78, 77(1)(a), and 77(2). The Commissioner (Appeals) upheld this decision, leading to the appeal before the Tribunal.

The appellant contended that they were registered with the Service Tax Department since 1998 and had discharged their service tax liability for the period 2011-2012 as a recipient of GTA service. The Advocate argued that the lower authorities failed to consider the submissions made by the appellant, merely reiterating previous findings.

Upon review, it was found that the appellant was initially registered and paying taxes under the previous regime. They were registered with the Service Tax in 1998 and received an exemption from service tax obligations for service received from Goods Transport Operators as an SSI Unit. However, confusion arose regarding the taxability of GTA services, which became taxable from January 2005. The appellant applied for registration again in 2012. Notably, the appellant had paid the service tax demand for the period 2011-2012 and April-June 2012. No evidence of fraud, collusion, willful misstatement, or contravention of provisions to evade service tax payment was found. Consequently, the demand for the extended period was set aside as barred by limitation, and penalties under Section 77(1)(a) and Section 77(2) were annulled invoking Section 80 of the Finance Act, 1994.

In conclusion, the Tribunal set aside the impugned order, disposing of the appeal in favor of the appellant. The judgment was pronounced in open court on 4th September 2018.