2014 (5) TMI 691 - AT - Service Tax

Denial of benefit of Notification No. 45/2010-S.T. dated 20.7.2010 - services relating to transmission and distribution of electricity - Held that - Appellant is, prima facie, eligible for the benefit of notification cited by the appellant and the matter requires fresh consideration as regards the applicability of notification as well as re-quantification. Accordingly, the requirement of pre-deposit is waived and the appeal itself is taken up for final decision - both sides agree that the matter is required to be remanded to the original adjudicating authority to consider the issue whether the benefit of exemption Notification would be available in respect of the services rendered to Power Distribution Company and also the original authority can consider the issue of re-quantification claimed by the appellant. Accordingly, the matter is remanded to the original adjudicating authority to consider the issues afresh and pass an appropriate order in accordance with law after giving reasonable opportunity to the appellant to present their case - Decided in favour of assessee.

Summary

Issues:
1. Applicability of service tax exemption notification for services rendered to a power distribution company.
2. Calculation of tax payable for services provided under different categories.
3. Requirement of pre-deposit and waiver of the same.

Analysis:

Issue 1: Applicability of service tax exemption notification for services rendered to a power distribution company
The appellant contended that they provided services falling under various categories to a power distribution company and should be exempt from service tax payment as per Notification No. 45/2010-S.T. dated 20.7.2010. The Tribunal found that the appellant may be eligible for the benefit of the notification and that the matter required fresh consideration regarding the applicability of the notification. The Tribunal waived the requirement of pre-deposit and proceeded to take up the appeal for a final decision.

Issue 2: Calculation of tax payable for services provided under different categories
The appellant raised concerns about the calculation of tax payable, stating that while they had paid the entire tax and interest for the subsequent period, there were errors in the tax calculation. After hearing both sides, the Tribunal acknowledged the appellant's submission regarding the wrong calculation of tax payable. The matter was remanded to the original adjudicating authority for re-quantification and to consider whether the benefit of the exemption notification would apply to the services rendered to the Power Distribution Company.

Issue 3: Requirement of pre-deposit and waiver of the same
Both parties agreed that the matter needed to be remanded to the original adjudicating authority for fresh consideration. The Tribunal waived the requirement of pre-deposit, allowing the appeal to be taken up for a final decision. The original authority was instructed to consider the issues afresh, including the applicability of the exemption notification and the re-quantification claimed by the appellant. The authority was directed to pass an appropriate order in accordance with the law after providing a reasonable opportunity for the appellant to present their case.

This judgment highlights the importance of correctly applying exemption notifications, ensuring accurate tax calculations, and providing a fair opportunity for parties to present their case before the adjudicating authority.