TMI Blog2014 (5) TMI 878X X X X Extracts X X X X X X X X Extracts X X X X ..... chanathan, Advocate JUDGEMENT Per Pradip Kumar Das 1. The relevant facts of the case, in brief, are that the assessee is engaged in the manufacture of excisable goods namely Motorcycles. and also registered with the service tax department for payment of service tax under the category of Goods Transport Agency Service . The assessee was discharging service tax on GTA service from their cenvat credit account. A show cause notice dt. 23-11-07 was issued alleging that the assessee is the manufacturer of excisable goods and not providing any output service and therefore they are not eligible to use cenvat credit for discharging service tax on GTA service. The assessee is liable to discharge service tax on GTA service by cash. Hence, it was proposed to demand an amount of Rs.10,27,257/- along with interest and penalty for the period April 2006 to January 2007. The adjudicating authority confirmed the demand of service tax of Rs.10,27,257/- along with interest under Section 73 (1) of the Finance Act, 1994 and disallowed the cenvat credit of Rs.10,27,257/- under Rule 14 of the CCR 2007 utilized towards the payment of tax and imposed penalty. Commissioner (Appeals) modified t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mits that the impugned order in so far as demand of tax and interest is liable to be set aside. 4. The Learned Authorized Representative on behalf of the Revenue submits that the Commissioner (Appeals) erroneously set aside the demand prior to 19.4.2006 following the amendment of Explanation to Rule 2(p) of Cenvat Credit Rules, 2004. He submits that the assessee is not providing any output service of GTA but they are only recipient of the GTA service. By virtue of Rule 2(1) (d) (iv) of Service Tax Rules, 1994 they have been deemed as 'service provider' for the purpose of discharging service tax. So, they are not actual service provider and hence GTA service is not an 'output service' within the definition of Rule 2(p) of CCR. He submits that the Explanation to Rule 2(p) of the Rules 2004 is a deeming provision in respect of payment of service tax. It is settled law that legal fiction created for a particular purpose cannot be extended to other areas. He submits that they are the manufacturer of excisable goods and therefore they cannot be deemed to be an output service provider. In this context, he relied upon the decision of the Hon'ble Supreme Court in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ans any taxable service, excluding the taxable service referred to in sub-clause (zzp) of clause (105) of section 65 of the Finance Act, provided by the provider of taxable service, to a customer, client, subscriber, policy holder or any other person, as the case may be, and the expressions 'provider' and 'provided' shall be construed accordingly; d) Rule (3) (4) of Cenvat Credit Rules, 2004 is as under :- Rule 3. CENVAT Credit . - (1) xxx xxx xxx (4) The CENVAT credit may be utilised for payment of (a) xxx xxx xxx xxx xxx (e) service tax on any output service e) Section 68 (2) of Finance Act, 1994 provides payment of service tax as under :- (2) Notwithstanding anything contained in sub-section (1), in respect of any taxable service notified by the Central Government in the Official Gazette, the service tax thereon shall be paid by such person and in such manner as may be prescribed at the rate specified in section 66 and all the provisions of this Chapter shall apply to such person as if he is the person liable for paying the service tax in relation to such service. f) Rule 2 (1) (d) (v) of Service Tax Rules, 1994 define ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... find any merit in the appeal filed by the Revenue. 8. Regarding the appeal filed by the assessee, I find that in view of the Notification No.10/08-CE (NT) dt. 1.3.2008, GTA service was excluded from the definition of output service under Rule 2(p) of the Cenvat Credit Rules, 2004 and therefore, they are eligible to utilize cenvat credit for payment of service tax on GTA service prior to 1.3.2008. The Ld. Advocate strongly relied upon the decision of the Division Bench of the Tribunal in the case of Shree Rajasthan Syntex Ltd. Vs CCE Jaipur 2011 (24) STR 617 (Tri.-Del.) . In that case, the Tribunal distinguished the decision in the case of ITC Ltd. (supra) and observed that the assessee is eligible to utilize cenvat credit for payment of service tax on GTA service prior to issue of notification No.10/08-CE (NT) dt. 1.3.2008. The relevant portion of the said decision is reproduced below :- 3.?After hearing the learned DR, we find that the issue is no more res integra and stands settled by various decisions of the Tribunal, which also stands confirmed by the Honble High Court of Punjab and Haryana. The Tribunal in the case of Commissioner of Central Excise, Nagp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tax through Cenvat Credit account does not arise. In other words, the Bench observed that M/s. ITC was not entitled to avail any Cenvat Credit and as such there can be no account of any credit for utilisation towards payment of duty on the GTA services so received by them. 6. As discussed above, for the period prior to issue of Notification 10/2008-C.E. (N.T.), dated 1-3-2008 the issue stands finally decided in favour of the appellant by various judgments referred supra and ITC decision not being relevant to the facts of the case, we by following the earlier precedent decisions on the issue involved, set aside the impugned orders and allow both the appeals with consequential relief to the appellants. 9. Similar view was taken by the Division Bench of the Tribunal in the case of M/s.National Engineering Inds. Ltd. Vs CCE Jaipur - 2011 (2) TMI 930 - CESTAT, Delhi. On the identical issue, the Single Member of the Tribunal in the case of CCE S.T Hyderabad Vs Aster Teleservices (P) Ltd. - 2013 (29) STR 475 (Tri.-Bang.) rejected the appeal filed by Revenue. The Division Bench of the Tribunal in the case of CCE Indore Vs Spendex Industries Ltd. - 2013 (31) STR 472 (Tri.-Del.) on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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