2013 (12) TMI 1376 - AT - Service Tax

Waiver of pre deposit - Demand of service tax - Valuation - Business support services - Collection of adda fees - Held that - adda fees is collected as a statutory fees and secondly land used for parking stands specifically excluded from the provisions of renting of immovable property. If that be so, we are prima facie opinion that collection of adda fees at the specifically rates prescribed by the Govt., cannot be held to be a service provided to the transporters/operators of buses - adda fees levied by District Magistrate as per authorization of Govt. is a statutory levy and cannot be held to be issue of any specific service provided and is not leviable to service tax under category of business support services - appellant should not be directed to deposit any amount of tax on this count in view of the above order of Commissioner (Appeals). Otherwise also we find that the demand stands raised by invoking longer period of limitation which cannot be held to be justified. The matter at the most involves interpretation of legal provision and cannot be held to be on account of any mala fide intent on the part of the appellant - Following decision of Kadamba Transport Corporation Ltd. reported as 2010 (6) TMI 667 - COMMISSIONER OF CUSTOMS, CENTRAL EXCISE AND SERVICE TAX (APPEALS), GOA - Stay granted.

Summary

Issues:
1. Whether the condition of pre-deposit of service tax and penalties should be dispensed with.
2. Taxability of adda fees collected by the appellant.
3. Tax liability on renting of immovable property, man power recruitment services, and management, maintenance, or repair services.
4. Justification of the demand raised invoking a longer period of limitation.

Analysis:
1. The appellant sought the waiver of pre-deposit of service tax and penalties amounting to Rs. 65,14,974/-. The major part of the demand pertained to business support services provided by the appellant during 2006-07 to 2009-10.

2. The appellant collected adda fees from buses for services like ticket counters and parking infrastructure. The Revenue contended that such fees constituted business support services taxable under the Finance Act, 1994. However, the Tribunal noted that adda fees were statutory charges collected as per government directions and excluded parking services from the definition of renting of immovable property. Citing a precedent, the Tribunal opined that the collection of adda fees did not amount to providing services to transporters/operators.

3. Regarding other demands, the Tribunal found that the appellant had already deposited the amount related to renting of immovable property. The demand for management, maintenance, or repair services was challenged by the appellant, arguing that the charges were for the entire work done, not based on the number of persons supplied. The Tribunal agreed with this contention. Additionally, the demand for man power recruitment services was disputed by the appellant, and the Tribunal found merit in the appellant's argument.

4. The Tribunal observed that the demand was raised invoking a longer period of limitation, which was deemed unjustified. The Tribunal noted that the matter primarily involved the interpretation of legal provisions and did not indicate any malicious intent on the appellant's part. Considering the appellant's arguments and the lack of contrary decisions presented, the Tribunal held that the appellant had made a prima facie case in their favor and allowed the stay petition unconditionally.

This detailed analysis of the judgment highlights the key issues addressed by the Appellate Tribunal CESTAT NEW DELHI and the Tribunal's reasoning behind the decision rendered in the case.