TMI Blog2011 (1) TMI 1066X X X X Extracts X X X X X X X X Extracts X X X X ..... t be deemed to be a service provider for purposes of payment of service tax for any period prior to 18-4-2006 - Held that:- Appellant has only a debatable case and has not established a foolproof case for complete waiver of pre-deposit , appellant has to make pre-deposit of a reasonable part of the amount of service tax for purposes of Section 35F of the Central Excise Act - ST/251/2009 - S/6/2011-WZB/C-II(CSTB) - Dated:- 10-1-2011 - S/Shri P.G. Chacko, Shri Sahab Singh, JJ. Shri M.H. Patil, Advocate, for the Appellant. Shri P.K. Agarwal, JCDR, for the Respondent. [Order per : P.G. Chacko, Member (J)]. In this application, the appellant seeks waiver of pre- deposit and stay of recovery in respect of service tax amount o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e demand of tax in this case is on the amounts reimbursed by MGL to M/s. British Gas in relation to the costs of deputation of the expert by M/s. British Gas to the JV company for the period of dispute. The department took the stand that M/s. British Gas provided management consultancy service to MGL and that the latter qua recipient of the service was liable to pay service tax under Section 73 of the Finance Act, 1994. The subject show-cause notice was issued for this purpose, wherein it was inter alia alleged that the secondment charges paid in foreign currency as consideration for management consultancy service was not disclosed to the department. The proposals in the show-cause notice were contested. In adjudication of the dispute, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bangalore v. Araco Corporation, 2010 (19) S.T.R. 169 (Kar.); (v) CST, Bangalore v. Toyoda Iron Works Co. Ltd., 2010 (19) S.T.R. 802 (Kar.); (vi) CST, Delhi v. Nyco, SA, 2010 (20) S.T.R. 599 (P H). The counsel points out that a special leave petition filed against the High Court s judgment in Indian National Ship Owners Association case was dismissed by the Apex Court vide 2009-TIOL-129-SC-S.T. = 2010 (17) S.T.R. J57 (S.C.). Claiming support from the above decisions, the learned counsel submits that it is settled law that a recipient, in India, of a taxable service received from abroad cannot be held to be a person liable to pay service tax for any period prior to 18-4-2006. 3. On the other hand, the learned JCDR has claimed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he learned counsel, there was no such liability for the appellant prior to 18-4-2006 inasmuch as, during such period, there was no charging provision in the statute. On the other hand, the learned JCDR s submission is that, as Notification No. 36/2004-S.T., dated 31-12-2004 introduced any taxable service provided by a person who is a non-resident or is from outside India does not have any office in India as a taxable service for the purpose of levy of service tax from the service recipient w.e.f. 1-1-2005, it cannot be gainsaid that the service recipient, in India, of such taxable service provided by a non-resident having no office in India is liable to pay service tax from 1-1-2005. It is in this context, the learned JCDR has pressed int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... High Court s judgment in Indian National Ship Owners Association case and held that an Indian recipient of service imported from a non-resident having no office in India did not have liability to pay service tax prior to enactment of Section 66A ibid. We also find that, in the case of KSEB (supra), the Hon ble Supreme Court did not have occasion to consider Section 66A of the Finance Act, 1994 and, therefore, a view was taken on the liability of service recipient on the basis of other provisions of the Finance Act read with certain provisions of the Service Tax Rules, 1994. However, in the case of Hindustan Zinc Ltd. considered by a Larger Bench of this Tribunal, Section 66A was also considered and it was held that the service recipient had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that they received a taxable service from a non-resident who had no office in India and hence liable to pay service tax qua recipient. The case of the appellant is that they did not have any intention to evade payment of service tax inasmuch as whatever service tax that might be paid would have been available as CENVAT credit for payment of duty on finished goods in India. In other words, a plea of revenue neutrality has been taken. 8. Considering all aspects of the case, we would like to hold that the appellant has to make pre-deposit of a reasonable part of the amount of service tax for purposes of Section 35F of the Central Excise Act. Accordingly, the appellant shall pre-deposit an amount of Rs. 5,00,000/- (Rupees five lakhs only) wi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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