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2024 (2) TMI 200 - AT - Service TaxLevy of service tax - Auctioneer s Service - Business Support Services - GTA services - levy of penalties. Services rendered by the Appellant and other agricultural producers co-operative marketing societies with regard to Auctioneer s Service - HELD THAT - It is to be observed that numerous judicial decisions have already gone into the differences between the process of Auction and Tender. Likewise, the taxability of Business Support Service for giving jewel loans and also GTA Service for transport of PDS goods for Tamil Nadu Government various decisions by the Tribunal have held in favor of the appellant. All these issues are no more res-integra and the facts in this appeal are identical to the decision of the Tribunal in the case of M/S. NAMAKKAL AGRICULTURAL PRODUCERS CO-OPERATIVE MARKETING SOCIETY VERSUS COMMISSIONER OF CENTRAL EXCISE, SALEM 2023 (4) TMI 1077 - CESTAT CHENNAI , wherein this Bench has observed The marketing and other services rendered by the appellant to their farmer members in selling their agricultural produce through tender process would not be coming under Auctioneer s Service under Section 65 (105)(zzzr) of the Finance Act, 1994. The statement of demand raised in this case is a combined one for all the three services viz., Auctioneer's Service , Business Support Service and Goods and Transport Agency Service . The amount of Service Tax demanded in each category is not ascertainable from the records and documents available in this appeal. The same is not also ascertainable either from the Statement of Demand No. 8/2013 dated 05.04.2013 or from the Order-in-Original No. 26/2014 JC(ST) dated 30.04.2014. Mandatory penalty under Section 78 of the Finance Act, 1994 - HELD THAT - Though period involved in this Statement of Demand covering normal period for the reason that the Appellant had failed to submit prescribed half-yearly ST-3 returns. It is opined that imposing penalty under Section 78 of the Finance Act, 1994 is not at all justified in the facts and circumstances of this case and so, the same is set aside. Payment of Service Tax on the GTA services - benefit of 75% abatement under Notification No. 32/2004-ST dated 03.12.2004 where the transporter has to certify as to non-availment of CENVAT benefit - benefit of Notification No. 34/2004-ST dated 03.12.2004 where freight paid on individual consignment upto Rs.750/- and multi-consignment freight upto Rs.1500/- - exemption for transport of food grains and pulses w.e.f. 29.02.2010 under Notification No. 33/2004-ST dated 03.12.2004 - HELD THAT - The period of dispute involved in this case is 01.10.2011 to 30.06.2012. As such, it is required to re-compute the GTA Service Tax payable by the Appellant after extending the benefit of the Notification No. 32/2004-ST and Notification No. 34/2004-ST and also for carriage of food grains and pulses under Notification No. 33/2004-ST dated 03.12.2004 subject to fulfillment of conditions by the Appellant considering the facts obtaining in this appeal. Thus, the demand confirmed against the Appellant under Auctioneer s Service and Business Support Service is not justified - Regarding demand of Service Tax on GTA Service, the Lower Adjudicating Authority is directed to re-compute the tax payable giving the benefit of abatement under Notification No. 32/2004-ST dated 03.12.2004 and exemption benefit under Notification No. 34/2004-ST dated 03.12.2004. The appeal is partly allowed and partly remanded.
Issues Involved:
1. Liability to pay Service Tax under "Auctioneer's Service". 2. Liability to pay Service Tax under Business Support Service (BSS) and Goods Transport Agency (GTA) services. 3. Sustainability of penalties imposed on the appellant. Summary: 1. Liability to Pay Service Tax under "Auctioneer's Service": The Tribunal examined whether the services rendered by the appellant constitute "Auctioneer's Service" in respect of marketing and other services for selling agricultural produce. It was observed that the appellant's activities, including selling goods through tenders, do not fall under "Auctioneer's Service". Numerous judicial decisions have distinguished between auction and tender, concluding that the appellant's services are not taxable under "Auctioneer's Service". The Tribunal referenced the decision in M/s. Namakkal Agricultural Producers Co-op. Marketing Society Vs. Commissioner of Central Excise, which supported this view. 2. Liability to Pay Service Tax under BSS and GTA Services: - Business Support Service (BSS): The Tribunal found that the appellant's activities of providing jewel loans to members do not constitute BSS. The services rendered are related to its members and not to any external entity, thus not falling under BSS. - Goods Transport Agency (GTA) Services: The Tribunal noted that the appellant undertook the work of lifting and delivering goods to ration shops under the Public Distribution System. It was established that the appellant engaged individual truck owners, not a goods transport agency, and thus was not liable for GTA services. However, the Tribunal directed the Original Adjudicating Authority to re-compute the tax payable, considering the exemptions and abatements available under various notifications. 3. Sustainability of Penalties Imposed: The Tribunal held that penalties under Section 78 of the Finance Act, 1994, were not justified. The appellant's failure to submit prescribed half-yearly ST-3 returns did not warrant such penalties, given the interpretational nature of the issues and the appellant's bona fide belief regarding tax liabilities. Conclusion: The Tribunal set aside the demand for Service Tax under "Auctioneer's Service" and BSS. It remanded the issue of Service Tax on GTA services to the Original Adjudicating Authority for re-computation, considering the applicable exemptions and abatements. The appeal was partly allowed and partly remanded.
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