2007 (9) TMI 216 - AT - Service Tax

Held that a person receiving taxable service from GTO was not covered by the provisions of Sections 70 and 73 of the Finance Act, 1994 and that any demand notice issued to such a person by the Department under Section 73 was not maintainable - above legal position did not get altered even after amendment of the Finance Act, 1994 by the Finance Act, 2003 in view of other decisions of SC & tribunal, commissioner (A) was justified in allowing assessee s appeal

Summary

Issues:
1. Condoning delay in filing appeal.
2. Liability to pay service tax for Goods Transport Operators Service.
3. Applicability of Supreme Court judgment in L.H. Sugar Factories case.
4. Effect of subsequent amendments to Finance Act 1994.
5. Precedential value of Tribunal's decision in Seshasayee Paper & Boards case.

Analysis:

1. The Tribunal condoned a 52-day delay in the filing of the Revenue's appeal, noting that the appeal itself was liable to be summarily dismissed on merits.

2. The case involved the respondents utilizing Goods Transport Operators Service without paying service tax or filing returns for a specific period. The department demanded service tax through a show-cause notice, which was contested. The Commissioner (Appeals) set aside the tax demand based on the Supreme Court's judgment in L.H. Sugar Factories case, leading to the department's appeal.

3. The appellant argued that subsequent civil appeals and amendments to the Finance Act 1994 challenged the finality of the L.H. Sugar Factories judgment. However, the Tribunal found that a similar issue had been decided against the Revenue in a previous case, citing the Seshasayee Paper & Boards judgment.

4. The Tribunal's decision in Seshasayee Paper & Boards case established that recipients of Goods Transport Operators Service were not liable to pay service tax for a specific period due to the Supreme Court's ruling and subsequent amendments to the Finance Act 1994. The decision highlighted that demands raised beyond the prescribed time limit were not maintainable.

5. Ultimately, the Tribunal upheld the impugned order based on the precedent set by the Seshasayee Paper & Boards case, dismissing the department's appeal in line with the established legal principles.