TMI Blog2011 (3) TMI 302X X X X Extracts X X X X X X X X Extracts X X X X ..... le 2(v), the respondent are deemed to be the provider of taxable services another legal fiction cannot be imported to treat the GTA service received by them as their output service - The GTA services which is received by the respondent is specifically covered by the definition of "input services" and the same services cannot be considered as "input service" as well as "output service" - Held that the GTA services received by the respondent cannot be treated as their "output service" and since in terms of the provisions of Rule 3(4) of Cenvat Credit Rules, the Cenvat Credit could be utilised only for payment of service tax on output services or payment of excise duty on final products, the respondents have wrongly paid the service tax on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ervice received by them is not their "output service'. The Asstt. Commissioner vide Order-in-Original dated 12-2-2009 confirmed the service tax demand of Rs. 40,439 along with interest and also imposed penalty of equal amount on them under section 78 of the Finance Act, 1994, penalty of Rs. 5,000 under section 77 and penalty of Rs. 200 per day under section 76 ibid. On appeal to the Commissioner (Appeals), the Commissioner (Appeals) vide order-in-appeal dated 31-7-2009 set aside the Asstt. Commissioner's order and allowed the appeal holding that in view of Explanation to Rule 2(p) of Cenvat Credit Rules, 2004 during the period of dispute, GTA services received by the respondent, on which they were liable to pay the service tax is deemed to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the output services means any taxable services provided by the provider of taxable services, to a consumer, client, subscriber, policyholder or any other person, as the case may be, and the expression 'provider' and 'provided' shall be construed accordingly, that from the definition of output service, it is clear that the output service is provided by the "provider of taxable service" to some client or customer and it would not include the services received by a person in respect of which, the person, by virtue of the provisions of Rule 2(1)(d) of Service Tax Rules, 1994 is liable to pay the service tax on the same as the service recipient, that in terms of the Rule 3(4) of the Cenvat Credit Rules, 2004, the Cenvat credit can be utilised fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... person liable for payment of service tax" has the meaning as assigned to it in Rule 2(1)(d) of the Service Tax Rules, 1994 and Rule 2(1)(d) of Service Tax Rules mentions various categories of persons including recipient of certain taxable service who are liable to pay the service tax in respect of the same and clause (v) of Rule 2(1)(d) mentions various categories of persons, who are liable to pay the service tax in respect of GTA services received by them. The respondent, being a Public Limited Company, are the "person liable to pay service tax" in respect of the GTA service received by them. Rule 2(r) of the Cenvat Credit Rules, 2004 states that "provider of taxable service" includes a "person liable for paying service tax". Thus the per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or manufacture any dutiable final products. There is no dispute that the respondent is a manufacturer of excisable final products and, therefore, this Explanation to Rule 2(p) is not applicable and the question as to whether the GTA services received by him can be deemed to be his output services has to be decided by the main definition that the output services is that which is actually provided by provider of taxable services to his clients or customers. 6. In the present case, the GTA service received by the respondent is not the service which has actually been provided by the respondent. The respondent is only a deemed "provider of taxable service" by virtue of provisions of Rule 2(v) for the reason he is the person liable to pay the s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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