Custom, Excise & Service Tax Tribunal
Tirumala Cotton Agro Products (P) Ltd vs Commissioner Of Customs, Central ... on 13 April, 2015
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH BANGALORE Appeal(s) Involved: ST/971/2011-SM [Arising out of Order-in-Appeal No. 10/2011 dated 31/01/2011 passed by the Commissioner of Customs, Central Excise and Service Tax, Guntur] For approval and signature: HON'BLE Mr. B.S.V. MURTHY, TECHNICAL MEMBER 1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? 2 Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? 3 Whether Their Lordships wish to see the fair copy of the Order? 4 Whether Order is to be circulated to the Departmental authorities? Tirumala Cotton Agro Products (P) Ltd. Thimmapuram - 522 233 Nadendla Mandal, Guntur Dist. Andhra Pradesh Appellant(s) Versus Commissioner of Customs, Central Excise and Service Tax, Guntur P.B. No. 331, C.R. Building, Kannavarithota, Guntur - 522 004 Andhra Pradesh Respondent(s)
Appearance:
None For the Appellant Mr. N. Jagdish, AR For the Respondent Date of Hearing: 13/04/2015 Date of Decision: 13/04/2015 CORAM:
HON'BLE Mr. B.S.V. MURTHY, TECHNICAL MEMBER Final Order No. 20951 / 2015 Per: B.S.V. MURTHY Appellants were paying service tax on GTA services received by them during the period from 01.02.2009 to 31.01.2010. Thereafter taking a view that they are receiving the services from private truck owners and therefore were not liable to pay tax at all, they filed a refund claim. Refund claim has been rejected on the ground that service is received from GTA or private truck owner, appellant is liable to pay service tax and therefore is not entitled to refund.
2. Today when the matter was called nobody is present on behalf of the appellant. However learned advocate for the appellant has sent written submissions in which it has been mentioned that the appeal may be decided on merits on the basis of written submissions and the grounds taken in the appeal memorandum.
3. In the appeal memorandum it has been stated that the appellant has cited 3 decisions before the learned Commissioner (Appeals) and all of those decisions have not been considered. The cited decisions have been reproduced in paragraph 3 of the order of the Commissioner (Appeals) which are as under:
a) CCE, Guntur Vs. Kanaka Durga Oil Products Pvt. Ltd. reported in [2009 (15) STR 399]
b) Final Order No. 527-28/2009 dt. 12.03.2009 of Honble CESTAT, Bangalore
c) Lakshminarayana Mining Co. Vs. CCE, Blore reported in [2009 (16) STR 691]
d) K.M.B. Granites Pvt. Ltd. Vs. CCE, Salem, reported in [2010 (19) STR 437 (Trib.-Chen.)]
4. Learned AR would submit that those decisions are no longer applicable and he relies on the decisions of Honble High Court of Madras in the case of CCE, Salem Vs. K.M.B. Granites Pvt. Ltd. reported in [2014 (35) S.T.R. 63 (Mad.)] and CCE, Salem Vs. Suibramania Siva Co-op. Sugar Mills Ltd. reported in [2014 (35) STR 500 (Mad.)]. In the case of K.M.B. Granites, para 6 & 7 are relevant and are reproduced below.
6. We find from the reading of the CESTAT order that the only ground taken therein was related to Section 65(50b) of the Finance Act. The CESTAT following the Bangalore Bench decision in the case of Lakshminarayana Mining Co. v. CST, Bangalore reported in 2009 (16) S.T.R. 691 (Tri.-Bang.) as well as in the case of CCE, Guntur v. Kanaka Durga Agro Oil Products Pvt. Ltd reported in 2009 (15) S.T.R. 399, held that transport undertaken by the individual lorry owners or truck owners are not considered as commercial concern under Section 65(50b) of Finance Act. Consequently, the CESTAT allowed the assessees appeal. Aggrieved by this order, the present appeal has been filed by the Revenue.
7. We have already considered the correctness of the CESTATs order in CMA. Nos. 3079 & 3080 of 2011 [The Commissioner of Central Excise v. The Salem Co-Operative Sugar Mills Ltd. & Anr.] by order dated 4-10-2013, which followed the decision of the Bangalore Bench decision in the case of CCE, Guntur v. Kanaka Durga Agro Oil Products Pvt. Ltd. reported in 2009 (15) S.T.R. 399 wherein, it was held that Section 65(50b) of Finance Act, did not cover a case of proprietary commercial concern to be treated as Goods Transport Agency and set aside the order of CESTAT that the expression commercial concern would include a proprietary concern also. In the case of Suibramania Siva Co-op. Sugar Mills Ltd. para 11 to 18 are relevant and are reproduced below:
11. We do not agree with the submission made by the learned counsel for the assessee.
12. The definition of Goods Transport Agency under Section 65(50b) of the Finance Act from 1-5-2005 and up to 30-4-2006, read as follows :
Goods Transport Agency, means any commercial concern which provides service in relation to transport of goods by road and issues consignment note, by whatever name called.
From 1-5-2006, the definition reads as follows:
Goods Transport Agency, means any person who provides service in relation to transport of goods by road and issues consignment note, by whatever name called.
Thus the only amendment that was brought under Finance Act, 2006 with effect from 1-5-2006 was that as against the commercial concern, the Finance Act substituted any person who provides and thus widened the scope of the definition as applicable to all persons irrespective of it being an individual or a commercial concern.
13. Notification No. 34/2004 S.T., dated 3-12-2004 granted exemption for liability as under :
Service tax exemption to consignments transported by road when gross amount charged is upto Rs. 1,500/- or when gross amount charged for an individual consignment is upto Rs. 750/- (w.e.f. 1-1-2005) In exercise of the powers conferred by sub-section (1) of Section 93 of the Finance Act, 1994 (32 of 1994), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts the taxable service provided by a goods transport agency to a customer, in relation to transport of goods by road in a goods carriage, from the whole of service tax leviable thereon under Section 66 of the Said Act, where -
(i) the gross amount charged on consignments transported in a goods carriage does not exceed rupees one thousand five hundred; or
(ii) the gross amount charged on an individual consignment transported in a goods carriage does not exceed rupees seven hundred fifty.
Explanation. - For the purposes of this Notification, an individual consignment means all goods transported by a goods transport agency by road in a goods carriage for a consignee. A reading of the Notification on exemption thus show that in contra distinction to an individual consignment as meaning all goods transported by a goods transport agency in a goods carriage for a consignee, enjoying exemption only when the gross amount charged does not exceed Rs. 750, in the case of consignments in a goods carriage the exemption is available if the charges did not exceed Rs. 1,500/-.
14. A reading of the Grounds of Appeal before the Tribunal shows that the objection of the assessee on the levy of interest was that there was no suppression on the payment of Service Tax and that the assessee volunteered to make the payment and that in any event in the face of the exemption Notification, there was no liability to pay the interest. In the additional grounds taken, the Tribunal, relied on the decision of the Bangalore Tribunal in the decision reported in 2009 (15) S.T.R. 399 (cited supra) on the scope of Section 65(50b) of the Finance Act, 1994 on the definition of Goods Transport Agency and the exemption Notification holding that when the transport services were rendered by individual truck/transport operators, the assessee was not liable to suffer the liability. Thus accepting the additional ground raised in the appeal, based on the decision reported in 2009 (15) S.T.R. 399 (Tribunal Bangalore) (cited supra), the Tribunal directed the Adjudicating Authority to find out whether the transporters were individual or not, so that the decision of the Bangalore Tribunal could be applied to the case. The Tribunal-Bangalore allowed the claim of the assessee that it was covered by the Exemption Notification.
15. A reading of the decision of the Bangalore Tribunal shows that in considering the applicability of the exemption Notification No. 34/2004-S.T., dated 3-12-2004, the Tribunal referred to the amendment to Section 65(50b) of the Finance Act on Goods Transport Agency and the clarification given by the Finance Minister in his Budget Speech and thus held that when the services were rendered by individual truck owner/operators, there was no liability to service tax. Thus the Tribunal viewed that when the tax was paid wrongly, the assessee was not liable to pay any service tax. In the circumstances, the Bangalore Tribunal allowed the appeal.
16. As far as the reliance placed on the Finance Ministers Speech in the course of budget presentation is concerned, Courts have consistently held that budget speech would not be taken in aid for understanding the scope of the clear terms of the provisions in the taxation enactment vide the decision of the Apex Court reported in 1998 (9) SCC 630 = 1998 (99) E.L.T. 199 (S.C.) [Union of India v. Ganesh Rice Mills and Another].
17. Section 65(50b) of the Finance Act, 1994 defines the Goods Transport Agency as any person who provides service in relation to transport of goods by the road and issuing consignment note, by whatever name called.
18. The expression any person is not defined under the Act. Section 3(42) of the General Clauses Act defines person, as including any company or association or body of individual whether incorporated or not. The thrust of the definition is that it includes every person engaged in an activity providing service of transport of goods by road. Thus, any commercial or a proprietary concern carrying on the business of Goods Transport would fall under the definition of Goods Transport, Agency in Section 65(50b) of the Finance Act. In the absence of any words of restriction, the definition any person thus would have application to any concern providing the service.
He relies on the decision of Honble High Court of Bombay to submit that the speech of the Finance Minister cannot be relied upon to interpret law or the notifications. This decision was rendered in the case of Amin Merchant Vs. Chairman, Central Board of Excise and Revenue and others reported in [2011-TIOL-654-HC-MUM-CUS.]. In view of the 3 High Court decisions cited before me, I do not think I should go into the other 3 decisions cited by the appellants. As regards written submission it has been stated that the claim has been rejected on the ground that it was not submitted in Form R. However since on merits I have found that appellant is not eligible this submission is not relevant. In the result appeal is rejected.
(Order pronounced and dictated in open court) (B.S.V. MURTHY) TECHNICAL MEMBER iss