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2025 (6) TMI 360 - AT - Service TaxLevy of service tax - port services cargo handling services and Goods Transport Agency (GTA) services - ELD THAT - The authorities below should have refrained from passing an order in the remand proceedings when the issue was under consideration by the Tribunal. This is a serious disregard to judicial discipline. The appellants have been subjected to repeated proceedings on the same issue which is decided by the Tribunal in the appellant s own case and in respect of the very same proceedings. The Bench in M/S. ASPINWALL CO. LTD. VERSUS THE JOINT COMMISSIONER OF SERVICE TAX CHENNAI 2018 (8) TMI 330 - CESTAT CHENNAI takes serious note of the same and cautions the authorities against any recurrence in this regard. Coming to the merits of the case it is found that the issue being already decided by this Bench the impugned proceedings are infructuous as far as merits and consequences are concerned. However for the sake of record the impugned order is set aside and the appeal is allowed with consequential relief if any as per law. Conclusion - i) The demand for service tax on port services was set aside. ii) The demand on cargo handling and GTA services was upheld but was already complied with by the appellant. iii) Penalties imposed on the appellant were set aside. The impugned order is set aside - appeal allowed.
1. ISSUES PRESENTED and CONSIDERED
The core legal questions considered by the Appellate Tribunal (AT) in this matter were:
2. ISSUE-WISE DETAILED ANALYSIS Issue 1: Validity of Service Tax Demand on Port Services, Cargo Handling Services, and GTA Services Relevant legal framework and precedents: The service tax provisions applicable to port services, cargo handling services, and GTA services were under scrutiny. The Tribunal had earlier adjudicated on these services in the same matter, notably in Final Order No. 42177/2018 dated 26.7.2018, which had set aside the demand relating to port services but upheld the demands on cargo handling and GTA services. The appellant had also paid the service tax on cargo handling and GTA services as per submissions. Court's interpretation and reasoning: The Tribunal reaffirmed its earlier decision that the demand for service tax on port services was not sustainable and thus set aside. It upheld the demand on cargo handling and GTA services, consistent with the previous order. However, the penalties related to these services were set aside in the earlier order. Key evidence and findings: The appellant had paid service tax on cargo handling and GTA services, and the Tribunal had already set aside penalties imposed on these services. The port services demand was earlier quashed by the Tribunal. Application of law to facts: The Tribunal applied the principle of finality to its earlier order and recognized that the issues concerning port services had been conclusively decided. The payment of service tax on cargo handling and GTA services by the appellant further diminished the scope of dispute on these services. Treatment of competing arguments: The appellant argued that since the Tribunal had already decided the issues in the first round of litigation, the subsequent orders confirming demands were untenable. The revenue representative reiterated the validity of the original and appellate orders. The Tribunal favored the appellant's submissions, emphasizing the binding nature of its earlier order. Conclusions: The Tribunal concluded that the demand for service tax on port services was not sustainable and that the demands on cargo handling and GTA services were already addressed by payment and earlier orders. Hence, no further demand was maintainable. Issue 2: Justification for Imposition of Penalties Relevant legal framework and precedents: Penalties under service tax law are imposed for non-compliance or evasion. The Tribunal had earlier set aside penalties on cargo handling and GTA services in its Final Order No. 42177/2018. Court's interpretation and reasoning: The Tribunal found that penalties imposed on the appellant were not justified, especially since the appellant had complied with tax payment on cargo handling and GTA services and the port services demand was set aside. Key evidence and findings: The appellant's payment of service tax and the Tribunal's prior order setting aside penalties were key factors. Application of law to facts: The Tribunal applied the principle that penalties should not be imposed where there is no substantive demand or where the demand has been complied with. Treatment of competing arguments: The revenue's insistence on penalties was rejected in light of the Tribunal's prior order and the appellant's compliance. Conclusions: Penalties imposed on the appellant were set aside as unjustified. Issue 3: Legitimacy of Passing Orders During Pendency of Appeal and Judicial Discipline Relevant legal framework and precedents: The principle of judicial discipline requires that authorities refrain from taking actions that interfere with or circumvent ongoing appellate proceedings. The doctrine of finality of orders prohibits repeated litigation on the same issue. Court's interpretation and reasoning: The Tribunal strongly disapproved the original authority's passing of Order in Original No. 21/2011 dated 25.2.2011 during the pendency of the appeal before the Tribunal, which confirmed demands on all three services again. The Tribunal noted this as a "serious disregard to judicial discipline" and cautioned the authorities against recurrence. Key evidence and findings: The appellant had informed the original authority about the pending appeal before the Tribunal through written submissions, yet the original authority proceeded with fresh demand orders. Application of law to facts: The Tribunal applied the principle that once an appeal is pending, the authorities should not take fresh action on the same issue. The repeated proceedings amounted to harassment and abuse of process. Treatment of competing arguments: The revenue did not provide justification for initiating fresh proceedings despite knowledge of the pending appeal. The Tribunal rejected any such justification impliedly by censuring the authorities. Conclusions: The impugned order passed during the pendency of appeal was set aside as infructuous and the authorities were cautioned against such disregard for judicial discipline. 3. SIGNIFICANT HOLDINGS The Tribunal made the following crucial legal determinations: "The authorities below should have refrained from passing an order in the remand proceedings when the issue was under consideration by the Tribunal. We find that this is a serious disregard to judicial discipline." "The appellants have been subjected to repeated proceedings on the same issue which is decided by the Tribunal in the appellant's own case and in respect of the very same proceedings. The Bench takes serious note of the same and cautions the authorities against any recurrence in this regard." "The issue being already decided by this Bench vide final order referred above, the impugned proceedings are infructuous as far as merits and consequences are concerned." Core principles established include:
Final determinations were:
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