2017 (12) TMI 1439 - AT - Service Tax

Transmission & distribution of electricity - N/N. 45/2010-ST dated 20.07.2010 - negative list - POT rules - Held that - the adjudicating authority has not dealt with the assessee s stand of the services being covered by the negative list and as such his views are not available - the stand of the Revenue is that the consideration received subsequent to 01.07.2012 would also be taxable is required to be adjudged and examined in the light of the point of Taxable Rules, 2011 - matter needs to be remanded to the adjudicating authority for fresh decision - appeal allowed by way of remand.

Summary

Issues involved: Dispute over service tax liability for transmission & distribution of electricity post 01.07.2012; Exemption under Notification No. 45/2010-ST prior to 01.07.2012; Interpretation of negative list post 01.07.2012; Validity of demand confirmed by Commissioner; Need for remand to adjudicating authority for fresh decision.

Analysis:

1. The judgment addresses the appeals by the assessee and the Revenue concerning the confirmation of service tax liability by the Commissioner for services related to transmission & distribution of electricity. The Commissioner confirmed the demand post 01.07.2012 but dropped it for the period before this date, citing exemption under Notification No. 45/2010-ST.

2. The appellant, engaged in providing services under composite contracts, argued that post 01.07.2012, transmission of electricity services fell under the negative list, requiring no specific exemption. The Revenue contended that services in the negative list post 01.07.2012 applied only to those provided by the State Government, not private entities like the appellant.

3. The Commissioner's order confirmed the demand for services post 01.07.2012, citing lack of exemption under the mega exemption Notification No. 25/2012-ST. The appellant raised the argument that the services were covered by the negative list post 01.07.2012, which the Commissioner did not address, leading to the need for a fresh decision.

4. The Tribunal found that the adjudicating authority did not address the appellant's argument regarding the negative list. The Revenue's stance on taxing consideration post 01.07.2012 was deemed to require examination in light of Taxable Rules, 2011. Consequently, the Tribunal set aside the impugned orders and remanded the matter for a fresh decision, emphasizing consideration of the entire legal framework.

5. The Tribunal allowed both appeals by way of remand, ensuring the appellant's opportunity to present their defense before a new decision is reached. The adjudicating authority was directed to expedite the denovo proceedings for resolution.

This judgment highlights the complexities surrounding service tax liability for specific services post a regulatory change, emphasizing the need for a thorough legal analysis and consideration of all relevant factors before reaching a decision.