9911796707
TMI Blog2015 (10) TMI 2002X X X X Extracts X X X X X X X X Extracts X X X X ..... has culminated in confirmation of demand of service tax of Rs. 2,05,494/- with interest and imposition of penalties under Sections 76 and 78 of Finance Act, 1994. Further, late fee for not filing the ST-3 returns under Section 70 of Finance Act is also imposed. Learned counsel on behalf of the appellant took me through samples of purchase order, invoice issued by M/s. Reliance Industries, supplier of inputs and the consignment note issued by M/s. PRC Logistics Ltd. His submission is that appellant was not the receiver of service from M/s. PRC Logistics and therefore appellant was not liable to pay service tax at all. Therefore he submitted that the demand itself is not sustainable leave alone invocation of extended period. He relied upon se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he submission of the learned AR that as per this Rule, it is not necessary that the person should be liable to pay freight to the transporter but what is required is the determination of the person who is liable for the freight. On the other hand it was the claim of the learned counsel that when the freight is not at all paid by the receiver of the goods to the transporter, it would mean that there is no nexus between the receiver and provider of service, there may not be a liability on the appellant as the receiver of service and therefore in terms of the provisions of the rule, the appellant does not become a person liable for payment of service tax in this case. 4. In the normal course this claim of the appellant would have been ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is case. 7. It is the submission of the appellant that they were not liable to pay service tax on the freight amount because the freight was paid by them to Reliance and they did not know how much was paid by Reliance to the service provider namely PRC Logistics and therefore they are not liable to pay. Further, on going through the consignment note, it was found that in the consignment note, the transporter had clearly mentioned that service tax has to be paid by the consignee. It is always a case that the invoice is accompanied by consignment note when the transporter receives the goods and delivers it to the party. In such a situation, it cannot be said that transporter was not aware that Reliance was charging the freight to the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t can be reached as regards service tax liability. Under the circumstances, I am unable to conclude that the appellant is not liable to pay service tax. In none of the decisions cited by the learned counsel the facts and did not reveal that there was a clear understanding either in the mind of the transporter or in the mind of the supplier that the service tax is payable by the consignee; that the amount is not shown separately and there is no clear understanding emerging from the documents. The issue becomes different and requires a separate consideration. Therefore the law has to be applied to the facts of each case and in my opinion; the facts of this case cannot lead to another conclusion. 8. The next submission made by the learne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld be paid to the transporter by the receiver of service to attract liability or not. There is scope for taking two views even though in this case, it is not exactly forthcoming. Further it is also found that appellant was entitled to Cenvat credit and therefore they could have entertained a bona fide belief. I have already taken a view that in any case, merely because the person is entitled to Cenvat credit it cannot be said that extended period should not be invoked especially in a situation like this where a person is clearly told that he is liable to pay the tax. In such a situation, it is not appropriate to say that demand itself is not sustainable. Nevertheless as regards penalties, the situation calls for application of provisions o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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