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2025 (2) TMI 627 - AT - Service TaxLevy of service tax for providing GTA service - period involved is from April 2008 to March 2013 - HELD THAT - The adjudicating authority has recorded in the impugned OIO that it is the appellant s stand that they are providing services to companies who are registered under the Companies Act 1956. It is also seen from the appellants replies to the SCNs that it is also their stand that they have clearly stated in their invoices that the service tax liability will be paid by either consignor or consignee and had enclosed sample invoices for the adjudicating authority s verification along with complete parties list and service amount for reference. While the adjudicating authority acknowledges that the documentary evidences adduced by the appellant have been perused these contentions of the appellant have not been disputed or contested by the adjudicating authority. From the legal provisions it is therefore evident that such companies private or limited would get covered under the specified entities/categories stated in the notifications for the respective periods either as a company or as a body corporate. The adjudicating authority has erred in confirming the demand of service tax on GTA services made on the appellant for the reason that coastal energy private limited and fossil logistics private limited had not responded to the subsequent letters of DGCEI sent to them on 05-09-2013. It was incorrect on the part of the adjudicating authority to take up cudgels on behalf of the investigating agency DGCEI who are amply empowered under statute to collect evidence in case they deem it so necessary by way of issuance of summons under Section 14 of the Central Excise Act 1944 of which they would be undoubtedly aware of - As regards the finding of the adjudicating authority on lack of details required as per Rule 4B that ought to figure in a consignment note in the invoices issued by the appellant in the absence of stating what were the details that have been found deficient or absent it is unable to appreciate the import of such finding except that the invoices were lacking certain details that ought to have been there in a consignment note which is a venial breach. In any event indisputably the appellant has been rendering the GTA services for which it is registered. The adjudicating authority grossly erred in confirming the demand of service tax on GTA services on the appellant on the ground that the appellant has not proved that the service tax has been paid by the recipients. When the position in law as emanating from the discussions above is that the onus of discharging the service tax on GTA services received itself was on the customers of the appellant then such a confirmation of demand as has been made in the instant case cannot be sustained and the demand on GTA services to the extent of the amounts stated as disputed in this appeal by the counsel for the appellant from the demand confirmed by the adjudicating authority is set aside. The appellant has produced a chartered accountant s certificate certifying that the amounts were indeed written off as bad debts and finding no valid objection raised as to the acceptance of the same or any reason to disbelieve the same such certification by an independent professional lends credence to the appellant s contentions in this regard and consider it sufficient to drop the demand. The penalties imposed on the appellant under Section 78 and Section 76 do not sustain. There are no grounds urged in the appeal or any specific contention advanced by the counsel against the demand of Rs.14, 200/- for the delay in filing of returns as well as the total penalty of Rs.10000/- under section 77 imposed on the appellant and we are therefore of the view that in the facts and circumstances of this case these need to be left without interference. HELD THAT - i) The liability to pay service tax on GTA services can shift from the service provider to the service recipient under specified conditions and that the service provider is not responsible for ensuring the service recipient fulfills their tax obligations. ii) The demand related to bad debts was dropped and penalties under Sections 76 and 78 were nullified. Appeal disposed off.
ISSUES PRESENTED and CONSIDERED
The core legal questions considered in this judgment include:
ISSUE-WISE DETAILED ANALYSIS 1. Liability to Pay Service Tax on GTA Services
2. Demand Pertaining to Reconciliation of Bad Debts
3. Penalties and Other Demands
SIGNIFICANT HOLDINGS
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