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2015 (11) TMI 1260 - AT - Service TaxWaiver of pre deposit - Stay of recovery of demanded service tax - Held that - applicant had made out a strong case for full waiver of pre-deposit. The sequence of transactions involved in transfer of money in this case indicate the absence service provider-service recipient relationship between the applicant and the foreign bank or intermediary. As such we find full waiver of demanded service tax and penalties is justified in this case. Accordingly we order the stay of recovery of tax amount along with penalties in this case till disposal of the appeal. - Stay granted.
Issues:
- Stay of recovery of demanded service tax amount along with penalties imposed by the original order. Analysis: The judgment revolves around the issue of stay of recovery of demanded service tax amount and penalties. The applicant, engaged in the export of garments, faced proceedings for demanding service tax on transaction charges deducted by foreign banks during the remittance process. The applicant contended that there was no service provider-service recipient relationship between them and the foreign bank, citing precedents and circulars to support their argument. The Tribunal examined the transaction process and agreed with the applicant's argument. They found that there was indeed no service provider-service recipient relationship between the applicant and the foreign bank or intermediary involved in the remittance process. Relying on the sequence of transactions and legal precedents, the Tribunal concluded that the applicant had a strong case for a full waiver of pre-deposit. Consequently, the Tribunal ordered the stay of recovery of the tax amount and penalties until the appeal's disposal. In essence, the judgment highlights the importance of analyzing the nature of transactions and the existence of a service provider-service recipient relationship in determining the liability for service tax. The decision underscores the need for a clear understanding of the legal framework and relevant precedents to support arguments in tax-related disputes.
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