2010 (4) TMI 497 - AT - Service Tax

Transport of goods by road service - service tax was demanded from assessee for transportation of consignment in goods carriage. Assessee disputed quantification of service tax liability on ground that as per Notification No. 34/2004-ST dated 3.12.2004 read with Notification No. 23/2008-ST dated 1.05.2008 there will be no service tax where consignment transported in a goods carriage does not exceed Rs. 1500 or gross amount charged on an individual consignment transported in a goods carriage does not exceed Rs. 750. Assessee submitted that no verification of freight document and freight account was carried out and if same was carried out there would be no service tax liability except as admitted by it and had been paid by it before adjudication. Matter was to be remanded to adjudicating authority for re-determination of tax liability.

Summary

Issues:
Quantification of service tax liability based on freight documents and accounts.

Analysis:
The appellant filed an appeal seeking waiver of pre-deposit for service tax and penalty amounts. The appellant argued that the dispute was about the quantification of the service tax liability, not the liability itself. Referring to specific notifications, the appellant claimed that if the consignment value did not exceed certain limits, no service tax was applicable. The appellant requested a remand to the original authority for verification of freight documents to determine the actual liability. Both the appellant's advocate and the Departmental Representative (DR) agreed on the necessity of verifying the freight documents. The judicial member concurred, emphasizing the importance of verifying the documents to quantify the service tax liability accurately. The matter was remanded to the original adjudicating authority for a fresh determination of the service tax liability in line with the relevant notifications, ensuring natural justice principles were followed. The stay petition was also disposed of accordingly.

This judgment primarily deals with the quantification of service tax liability based on the verification of freight documents and accounts. The appellant contended that no service tax liability existed beyond the amount already paid, pending verification of the freight documents. The judicial member acknowledged the necessity of examining the freight documents to ascertain the applicability of specific notifications exempting service tax under certain conditions. The decision to remand the matter for fresh adjudication emphasizes the importance of accurate quantification based on documentary evidence, ensuring the appellant receives the benefit entitled under the relevant notifications. The judgment underscores the significance of following natural justice principles in the adjudication process, highlighting the procedural fairness essential in tax matters.