2023 (8) TMI 1234 - AT - Service Tax

Eligibility for Exemption N/N. 30/2012-ST - Service classifiable under goods transport agency service - payment received as consideration of service for which TDS was deducted and reflected in 26AS - HELD THAT - From the notification, it can be seen that in case of service provided by a goods transport agency service in respect of transport goods by road, 100 % Service Tax liability is on a person receiving the service subject to condition that the said service recipient falls under the category of clause A(ii)(a)to(f) of para 1of the Notification. On the claim of the appellant that in case of GTA the service recipient is liable to pay the Service Tax in terms of the above Notification, the Learned Commissioner (Appeals) has held that in absence of any documentary evidences, the benefit of exemption cannot be extended to the Appellant on the basis of presumption. Thus, despite there are numbers of limited and private limited companies as service recipients, the Learned Commissioner (Appeals) has assumed that the majority these customers maybe proprietor and accordingly exemption was denied. The finding given by the learned commissioner (Appeals) is cryptic and cannot be agreed upon -Firstly, by name itself it appears that most of the service recipients are limited and private limited companies and also the partnership firm. At least in that cases the Service Tax could not have been demanded from the appellant. Moreover, in respect of others merely by name it cannot be ascertained whether the service recipient are covered under clause A(ii)(a)to(f) of notification. It was incumbent on the Learned Commissioner (Appeals) to verify the actual status of the service recipients from the records. In this position, the whole matter needs to be reconsidered by the Adjudicating authority. Appeal allowed by way of remand.

Summary

Issues involved:
The issues involved in this case are:
1. Whether Service Tax demand can be confirmed solely based on Form 26AS details of Income Tax.
2. Whether the appellant's activity falls under 'goods transport agency service' and if the service recipient is liable to pay the Service Tax.

Issue 1: Service Tax demand based on Form 26AS details:
The department alleged that the payment received as consideration of service, for which TDS was deducted and reflected in Form 26AS, indicates that the appellant provided a taxable service. The demand was confirmed and upheld by the Commissioner (Appeals). The appellant argued that confirming Service Tax demand solely based on Form 26AS is not sufficient.

Issue 2: Classification under 'goods transport agency service':
The appellant contended that their activity falls under 'goods transport agency service', making the service recipient liable to pay the Service Tax. The Commissioner (Appeals) denied this claim, stating that most customers may be proprietary firms not covered under the notification, thus rejecting the benefit of Notification No. 30/2012-ST.

Judgment:
The Tribunal considered the submissions and found that the matter should be decided by remanding it to the Adjudicating Authority to determine if the service is classifiable under 'goods transport agency service' and eligible for exemption under Notification No. 30/2012-ST. The Tribunal highlighted that the burden of proof for exemption lies with the claimant and that conditions of an exemption notification must be strictly satisfied. The Commissioner (Appeals) assumed that the majority of customers were proprietary firms, leading to the denial of exemption. The Tribunal disagreed with this finding, emphasizing that the actual status of service recipients should have been verified. Therefore, the matter was remanded for reconsideration by the Adjudicating Authority.

Conclusion:
The Tribunal set aside the demand and the impugned order, remanding the case to the Adjudicating Authority for a comprehensive review. The appeals were allowed by way of remand, rendering the stay applications unnecessary and disposed of accordingly.