2023 (7) TMI 306 - AT - Service Tax

Denial of abatement on recipient of Goods Transport Agency Services - non-production of certificate of the transporter - denial of abatement on the ground that Appellant has submitted a Xerox copy of the declaration made by M/s Vivekanand Roadlines stating that no Cenvat Credit was taken by them. HELD THAT - It has been consistently held by various co-ordinate Benches of this Tribunal that the condition specified is by way of CBEC Circular and is not a mandatory condition specified under any Notification. Hence, non-production of certificate of the transporter will not deprive the Appellant from the benefit of abatement of 75%. The Ahmadabad Tribunal in the case of CST AHMEDABAD VERSUS M/S CADILA PHARMACEUTICALS LTD. 2010 (2) TMI 237 - CESTAT, AHMEDABAD has held that The Board had clarified that the endorsement has to be made on the consignment note. Further, we have to take note of the fact that the notification, as such, does not stipulate any such condition. Notification requiring the receiver of the service to pay the tax also does not stipulate any such condition. Therefore, the requirements prescribed by the Board as per circular cannot be mandatory and cannot be used for denying substantive rights. It is not the case of the Revenue that the appellants have not received the service or service tax has not been paid. Similar was held in the case of AARTI INDUSTRIES LTD. VERSUS COMMISSIONER OF C. EX., SURAT 2012 (9) TMI 451 - CESTAT, AHMEDABAD . As the issue involved in the present case is identical, the impugned OIA is set aside and the Appeal filed by the Appellant is allowed.

Summary

Issues involved:
The issue in the judgment pertains to the payment of Service Tax by the Appellant for Goods Transport Agency Services, specifically regarding the abatement of 75% from the gross value and the requirement of a certificate from the transporter to avail the benefit.

Summary:

Issue 1: Abatement of Service Tax
The Appellant received Goods Transport Agency Services and was required to pay Service Tax on the gross value of freight. The Appellant claimed the benefit of abatement of 75% from the gross value and had already paid Service Tax on the remaining 25% during the period 2005-2006. The Adjudicating Authority confirmed a balance demand along with interest and penalty. The Commissioner (Appeals) noted that no evidence was provided regarding Cenvat Credit but acknowledged a declaration from the transporter stating no Cenvat Credit was taken. The Tribunal held that the condition specified for abatement was not mandatory under any Notification, and non-production of the transporter's certificate does not deprive the Appellant of the benefit of abatement.

Issue 2: Legal Precedents
The judgment referred to legal precedents to support the Appellant's position. The Ahmadabad Tribunal case highlighted that the conditions for abatement were not stipulated in the relevant notifications and that additional conditions prescribed by circulars cannot deny substantive rights. Another case cited upheld that in the absence of specific conditions in the notification, benefits cannot be denied based on circulars. The Tribunal, considering these precedents, set aside the impugned order and allowed the Appellant's appeal with consequential relief as per the law.

In conclusion, the Tribunal ruled in favor of the Appellant, emphasizing that the conditions for abatement were not mandatory and that the Appellant should be allowed the benefit of the abatement of 75% from the gross value of freight for the Goods Transport Agency Services.