2010 (12) TMI 579 - AT - Service Tax

Waiver of pre-deposit - Erection & commissioning services - The appellant herein is providing erection and commissioning services to Gulbarga Development authority and rent-a-cab services to electricity supply companies like HESCOM - The appellant submits that their activity is fully covered by the 11C Notification No. 45/2010-S.T. dt. 20-7-2010 wherein the Government of India has excluded all taxable services related to transmission of electricity and distribution of electricity - The said Notification prima facie may cover the issue in favour of the assessee as regards the service tax liability on the erection & commissioning charges as it is not disputed that the said services are rendered to HESCOM which is the business of transmission and distribution of electricity - The appellant has made out a prima facie case for waiver of pre-deposit towards service tax liability involved in the erection & commissioning services - Hence waiver of pre-deposit of balance amounts involved is allowed and recovery thereof stayed .

Summary

Issues involved:
Service tax liability on erection & commissioning services and rent-a-cab services.

Analysis:

Service Tax Liability on Erection & Commissioning Services:
The issue in this case pertains to the service tax liability on the erection & commissioning services provided by the appellant to Gulbarga Development Authority and rent-a-cab services to electricity supply companies like HESCOM. The appellant claimed that their activity is covered by Notification No. 45/2010-S.T., which excludes taxable services related to the transmission and distribution of electricity. The appellant argued that the exemption under this notification should apply to their services. On the other hand, the Departmental Representative contended that the notification does not cover the services provided by the appellant and referred to a decision by the Larger Bench of the Tribunal to support their argument. However, upon careful consideration, the Tribunal found that the notification indeed granted exemption to all taxable services related to transmission and distribution of electricity until specific dates. The Tribunal observed that the services provided by the appellant to HESCOM, involved in the transmission and distribution of electricity, may be covered by the notification. Therefore, the Tribunal concluded that the appellant made a prima facie case for waiver of pre-deposit towards the service tax liability on the erection & commissioning services.

Service Tax Liability on Rent-a-Cab Services:
Regarding the service tax liability on rent-a-cab services, the appellant had already deposited a portion of the liability. The appellant claimed that out of the total liability of Rs. 50,000, they had already paid Rs. 45,000. The Tribunal acknowledged this payment and noted that the appellant had complied with a significant portion of the liability. Consequently, the Tribunal allowed the application for waiver of pre-deposit of the remaining balance amounts involved in the case and stayed the recovery of the same until the appeal was disposed of.

In conclusion, the Tribunal granted the appellant's request for waiver of pre-deposit of the balance amounts involved in the service tax liabilities on the erection & commissioning services and rent-a-cab services, based on the interpretation of the relevant notification and the appellant's compliance with the partial payment of the liabilities.