2013 (12) TMI 739 - AT - Service Tax

Waiver of pre-deposit - Service tax demand - Interest under Section 75 - Penalties under Sections 76, 77 and 78 - Support Service of Business or Commerce - Held that - any service provided in relation to business or commerce including those falling within the inclusionary part of the definition constitutes the taxable service enumerated. On this prima facie view, the amounts collected by the petitioner as user charges or fees for facilitating the business of transportation of passengers, of entities which had utilised the terminal facility brought up by the petitioner would amount to providing Support Service of Business or Commerce - Conditional sty granted.

Summary

Issues:
1. Waiver of pre-deposit and stay of adjudicated liability sought.
2. Classification of services provided by petitioner under Support Service of Business or Commerce.
3. Service tax demand, interest, and penalties imposed.
4. Petitioner's resistance to proceedings based on cost, activity classification, and limitation period.
5. Adjudicating authority's confirmation of levy and recovery directions.
6. Interpretation of Section 65 (104c) defining support services of business or commerce.
7. Prima facie view on user charges as Support Service of Business or Commerce.
8. Lawful invocation of extended limitation period.
9. Granting waiver of pre-deposit and stay of proceedings.

Analysis:

1. The petitioner sought waiver of pre-deposit and stay of adjudicated liability following an order by C.C.E., Ludhiana, which classified the services provided as Support Service of Business or Commerce, confirming a service tax demand of Rs.1,70,91,927/- along with interest and penalties under various sections of the Finance Act, 1994.

2. The petitioner, a service tax registered entity, engaged in the business of promotion, development, and operation of infrastructural projects under a concessionaire agreement with the State of Punjab for a bus terminal project. The services provided included various facilities for passenger vehicles and users, leading to the revenue's assumption of Support Services of Business or Commerce being provided.

3. The adjudicating authority upheld the levy of service tax, interest, and penalties, directing recovery as per due process, despite the petitioner's contentions regarding the nature of user charges, activity classification, and the invocation of the extended limitation period.

4. The interpretation of Section 65 (104c) defining support services of business or commerce, which includes services related to business activities, was crucial in determining the applicability of the tax on the user charges collected by the petitioner for facilitating transportation services.

5. The appellate tribunal, in its prima facie view, considered the user charges collected by the petitioner as falling within the ambit of Support Service of Business or Commerce, aligning with the inclusive clause of the definition under Section 65 (104c).

6. The issue of the lawful invocation of the extended limitation period was deferred for final hearing, with the petitioner claiming early provision of relevant information and the revenue asserting delayed availability, leaving the decision pending.

7. Considering undue hardship to the petitioner and a prima facie case made out, the tribunal granted waiver of pre-deposit and stayed further proceedings for realizing the adjudicated liability, subject to the petitioner remitting the service tax amount plus interest within a specified timeframe, failing which the waiver would stand rescinded.

This detailed analysis covers the issues raised, the arguments presented, the legal interpretations applied, and the final decision rendered by the Appellate Tribunal in the referenced judgment.