2024 (1) TMI 454 - AT - Service Tax

Levy of service tax - reverse charge mechanism - received services from Goods Transport Operators - HELD THAT - The bearing of tax liability would be on the Appellant himself, that would have resulted in a revenue neutral situation apart from the fact that low turnover in the entire period of 5 years is a sufficient indication that abatement could have been taken as an alternate plea for seeking exemption from tax liability, had the activities of the Appellant been covered under taxable service which going by the judgment of this Tribunal passed in the case of M/S. NANDGANJ SIHORI SUGAR CO. VERSUS CCE. LUCKNOW 2014 (5) TMI 138 - CESTAT NEW DELHI is held to be not taxable. Appeal allowed.

Summary

Issues involved: Confirmation of Service Tax demand, recovery under Section 73 of the Finance Act, interest under Section 75, penalty under Section 77, equal penalty under Section 78, appeal against partial rejection of appeal by the Commissioner.

Summary:
The Appellant challenged the confirmation of Service Tax demand, recovery, and penalties imposed under various sections of the Finance Act by the adjudicating authority, which was partially upheld by the Commissioner (Appeals) Service Tax-II, Mumbai Zone. The Appellant contended that the truck owners were not issuing consignment notes as required under the Service Tax Rules, and therefore, Service Tax was not applicable. The Appellant argued that the invoices issued by the truck owners did not qualify as consignment notes, citing relevant case laws. The Respondent-Department supported the Commissioner's order, emphasizing the rationality of the decision.

Upon reviewing the case record, judgments, and submissions, the Tribunal considered the distinction between 'Goods Transport Operators' and 'Goods Transport Agency' (GTA). The Tribunal noted that the Appellant had received services from Goods Transport Operators, and the payment of Service Tax under reverse charge mechanism had been invalidated by previous court decisions. The Tribunal found that the Appellant's activities did not fall under taxable services, as established by precedents. Therefore, the Tribunal allowed the appeal and set aside the Commissioner's order regarding the confirmation of demand, interest, and penalties, providing consequential relief.

In conclusion, the Tribunal allowed the appeal, setting aside the order of the Commissioner (Appeals) Service Tax, Mumbai-II, and providing relief to the Appellant.