2016 (3) TMI 12 - AT - Service Tax

GTA - reverse charge - export of goods - scope of exemption from payment of service tax in terms of Notification No.41/2007-ST - Held that - if the exporter, who is also required to pay the service tax is the same person, then the exemption can be claimed by the said person himself. First paying service tax and immediately thereafter claiming refund of the same by the same person, i.e., exporter apart from creating a revenue-neutral situation, does not seem to be legislative intent. If the interpretation as given by the adjudicating authority is accepted, then the said proviso would become redundant and otiose inasmuch as the Revenue s stand would be covered by the main clause of the Sl. No. 2(a) and there was no requirement to add the proviso. It is well settled law of interpretation that the interpretation which renders the provision of law otiose or redundant has to be avoided. As per the learned advocate, all the shipping bills for the period in question stand mentioned in the EXP2 and the adjudicating authority is also not disputing or denying the fact of export inasmuch as he has accepted the BRCs issued by the banks, thus establishing the fact of export. The adjudicating authority has not, in fact, examined the issue from the said angle and has also not examined the other documentary evidences available on record so as to establish the fact of export. We deem it fit to remand the said issue also to the Commissioner for fresh decision. - Decided in favor of assessee.

Summary

Issues:
1. Service tax liability on reverse charge basis for recipient of GTA services.
2. Exemption from payment of service tax under Notification No.41/2007-ST.
3. Benefit of exemption Notification No.18/2009-ST for GTA services received.
4. Challenge of confirmations relating to transportation charges.
5. Demand confirmed under "Mining of Mineral Oil and Gas service."

Analysis:

1. Service tax liability on reverse charge basis for recipient of GTA services:
The Tribunal noted the appellant's status as an exporter of iron ore availing various services, including Goods Transport by Road services. A demand of around Rs. 7.21 crores was confirmed against the appellant for service tax liability, interest, and penalties. The Tribunal decided to remand the matter to the Commissioner for fresh adjudication.

2. Exemption from payment of service tax under Notification No.41/2007-ST:
A demand of Rs. 5,46,543/- was confirmed against the appellant for the period April 2009 to June 2009, rejecting the appellant's plea for exemption under Notification No.41/2007-ST. The Tribunal analyzed the Notification's provisions and the issue of claiming exemption by the exporter who is also liable to pay service tax. It was concluded that the matter needed further consideration by the Commissioner, considering the proviso to the Notification.

3. Benefit of exemption Notification No.18/2009-ST for GTA services received:
An amount of Rs. 6.18 crores approximately was confirmed for GTA services received from July 2009 to March 2011 by rejecting the benefit of exemption under Notification No.18/2009-ST. The Tribunal found discrepancies in the adjudicating authority's observations regarding the exporter's compliance with the conditions of the Notification. It was decided to remand the issue for fresh decision by the Commissioner.

4. Challenge of confirmations relating to transportation charges:
The appellant had deposited amounts related to transportation charges but challenged the confirmations. As the matter was being remanded, the Tribunal kept these issues open for fresh consideration by the adjudicating authority.

5. Demand confirmed under "Mining of Mineral Oil and Gas service":
A part of the demand amounting to Rs. 28,97,304/- was confirmed for the period April 2010 to March 2011 under the category of "Mining of Mineral Oil and Gas service." The appellant raised objections based on the nature of services provided and non-receipt of consideration. The Tribunal allowed the appellant to present these submissions before the adjudicating authority during the fresh consideration.

In conclusion, the Tribunal set aside the impugned order and remanded the matter for detailed reconsideration by the Commissioner, addressing various issues related to service tax liability, exemptions, compliance with Notification conditions, transportation charges, and nature of services provided.