2014 (12) TMI 546 - AT - Service Tax

Waiver of predeposit - Site Formation Services - Manpower and Recruitment Agency & Security Services - filling of soil to facilitate erection of towers. - Extended period of limitation - Held that - Applicant were issued three show cause notices in which Manpower Supply and Security Services are common, whereas, in the third show cause notice, the Department had also alleged non-payment of service tax on Site Formation , which claimed to have been noticed by the Department during the course of investigation in the year, 2011. There is some force in the argument of the ld. Advocate for the Applicant that the third show cause notice would be barred by limitation in view of the judgment of the Hon ble Supreme Court in Nizam Sugar s case 2006 (4) TMI 127 - SUPREME COURT OF INDIA . However, regarding the demand relating to Site Formation Services , we are not convinced that the demand on such services, raised in the third show cause notice for the first time, after necessary investigation by the department, would also be barred by limitation. Prima facie, we are of the view that the services rendered by the Applicant to M/s. Reliance Telecommunication Ltd. are Site Formation Services . In these circumstances, the Applicant though could able to make out a prima facie case in their favour for total waiver of the dues against the demand relating to Manpower Supply and Security Services , whereas, in relation to the demand on account of Site Formation Service , they could not able to make out a case for total waiver. - Partial stay granted.

Summary

Issues: Application seeking waiver of predeposit, demand for services under 'Manpower and Recruitment Agency' and 'Security Services', invocation of extended period of limitation, demand for 'Site Formation Services', leviability of service tax on 'Site Formation Services'.

The judgment pertains to an Application seeking waiver of predeposit of a specific amount along with penalties under various sections of the Finance Act, 1994. The Applicant had been providing services under the categories of 'Manpower and Recruitment Agency' and 'Security Services' since 2001. The Advocate for the Applicant argued that three show cause notices were issued, with the second and third notices being considered barred by limitation based on a judgment of the Hon'ble Supreme Court. The Revenue, however, contended that in the third notice, demand was raised for 'Site Formation Services' in addition to the other services, which came to the Department's notice in 2011. The Advocate for the Applicant refuted this claim, stating that the services in question were merely filling soil for tower erection, not 'Site Formation Services'.

Upon hearing both sides, the Tribunal found that while the third show cause notice might be barred by limitation for the services common to all notices, the demand for 'Site Formation Services' was not. The Tribunal noted that the services provided to a specific company indeed fell under 'Site Formation Services' as per the Revenue's argument, despite the Applicant's contention. Consequently, the Tribunal directed the Applicant to deposit 25% of the amount related to 'Site Formation Services' within a specified period, with the remaining dues waived upon compliance. Failure to deposit would result in the dismissal of the Appeal without further notice. The decision aimed to balance the interests of the revenue and the financial hardship claimed by the Applicant. The compliance deadline was set for a future date, with consequences outlined for non-compliance.