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2016 (8) TMI 1029 - CESTAT HYDERABAD

2016 (8) TMI 1029 - CESTAT HYDERABAD - 2016 (45) S.T.R. 414 (Tri. - Hyd.) - Demand of tax with interest - penalty under Sections 76, 77 and 78 of the Finance Act, 1994 non-submission of statutory returns Barites Ore and Iron Ore - mining service GTA service supply of tangible goods service - proviso to Section 73(1) of the Finance Act, 1994 - Imposition of equal penalty under section 78 of the Finance Act, 1994 Held that: - non-payment/ short payment of service tax cannot be held to be .....

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s valid only when the output service is in the nature of service defined under the provisions of Section 65 (105) (zzzzj) of the Finance Act, 1994 and the goods in question are the tangible goods supplied during the course of providing the taxable service. The determination of service tax liability therefore require to be predetermined after taking into account eligible input credit matter remanded appeal disposed off decided in favor of appellant. - ST/2490/2011 - Final Order No. A/3060 .....

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Ltd. (APMDCL) during the period January 2008 to April 2008. Department alleged that the appellants have evaded payment of service tax on the Mining service, Goods Transport Agency Service (GTA service) and Supply of Tangible Goods Service (SOTG service), not paid service tax on GTA service and SOTG service. It was also alleged that the appellants have not submitted their statutory returns for the period from the half year ending 31/03/2009 and 30/09/2009. 1.2. In view of the above, the Revenue .....

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g the grounds to prove that the allegations proposed in the notice is not legally correct and in view of the same, the demand proposed in the notice is liable to be dropped. 1.4. Adjudicating authority has passed the impugned order dt. 31/03/2011 and confirmed the demand proposed in the notice, while dropping penalty under Section 78 of the Finance Act, 1994 and reducing the demand of ₹ 1,11,92,932/- as against ₹ 1,40,40,355/-proposed towards SOTG service. Hence this appeal. 2. The a .....

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mpers, tippers etc). If the benefit of the Circular is granted to them, it would more than cover the Tax liability of ₹ 1,11,92,932/- confirmed by the said authority. c. With reference to Transport of goods by road service (period of dispute: January 2005 to March 2009), while the adjudicating authority has found merit in the submission that no service tax was payable as there was no service provider-service recipient relationship, however he has wrongly concluded that they are liable to p .....

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e further pointed out that since dumpers and tippers are motor vehicles under chapter 87, CENVAT credit cannot be availed on them. 4. We have considered the rival submissions made by both sides and also gone through the records of the case. 5. We first take up the matter of imposability of equal penalty under Section 78 of the Finance Act, 1994. We find that the penalty of ₹ 1,83,31,469/- equals the total of the demands made in respect of mining service, supply of tangible goods service an .....

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oods service, we find that there was a doubt during the period of dispute as to whether credit of duty paid on, inter alia, vehicles used in supply of tangible goods service is available to the provider of such taxable service and, if so, whether such goods should be considered as inputs or capital goods. This matter was finally resolved by issue of Board Circular F. No. 137/120/2008-CX-4 dated 23.10.2008. In respect of goods transport agency service, we note that during the period of dispute th .....

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e and requires to be set aside, which we hereby do. 6. Regarding the demand of ₹ 1,11,92,132/- in respect of supply of tangible goods for use of services, the appellant has contended that as per aforesaid Board's Circular dated 23.10.2008, they would have been entitled to credit of ₹ 1,18,08,298/- whereas tax payable was lower than that. We find merit in this contention. Relevant portion of Board's Circular referred to is reproduced below: Supply of tangible goods including m .....

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id on such items are available to the provider of such taxable service and if so whether such goods should be considered as 'inputs' or 'capital goods', for the purposes of the CENVAT Credit Rules, 2004. 2. The matter has been examined. It is possible that some of such goods may either fall within the definition of 'capital goods' or may not be covered under the said definition. However, as these goods are primary requirements for providing the above mentioned 'output .....

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