2007 (12) TMI 164 - AT - Service Tax

Assessee provide specialized services to bank in respect of promotion and marketing of home loans, personal loans and credit cards - held that this activity does not come within the ambit of Business Auxiliary Services, as the activity was brought within the category of Business Support Services w.e.f. 1- 5-2006 only - we allow the stay application granting waiver of pre-deposit and staying its recovery

Summary

Issues:
1. Whether the appellants are required to pre-deposit Service tax and penalties under various sections?
2. Whether the services provided fall under "Business Auxiliary Services" or "Business Support Services"?
3. Whether the Final Order in a previous case applies to the current case?
4. Whether the stay application should be granted?

Analysis:
1. The appellants were asked to pre-deposit a significant amount of Service tax and penalties under different sections by the department. The services provided by the appellants were related to promotion and marketing of financial products for M/s. ICICI Bank Ltd., which led to the demand for Service Tax and penalties.

2. The learned Counsel argued that a previous Final Order by the bench had determined that similar activities for another agent of M/s. ICICI Bank Ltd. did not fall under "Business Auxiliary Services" but under "Business Support Services" starting from a specific date. It was contended that this decision should apply to the current case as well.

3. The learned JDR requested a fixed date for the final hearing to present arguments on the main appeal and referred to cross objections filed. The bench examined the Final Order in the case of Mr. S.R. Kalyanakrishnan and found that the issue was identical. It was noted that the activity carried out by the appellant did not fall under 'Business Auxiliary Services' but under 'Business Support Services' as per the Final Order cited, leading to the grant of a stay application.

4. Considering the similarity in issues and the previous Final Order's decision, the bench allowed the stay application, waiving the predeposit and staying the recovery until the appeal's disposal. The appeal was scheduled for an expedited hearing, with no recovery permitted until the appeal's resolution, ensuring fairness in the proceedings.