The Chennai bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) granted relief to the TamilNadu Electricity Board by quashing the service tax demand on the Goods Transport Agent (GTA) services on the ground of limitation.
Tamilnadu Electricity Board, the appellant assessee was engaged in the manufacture of Line materials and Tower parts which are transported to various distribution circles of Tamil Nadu Electricity Board (TNEB), Mettur by engaging the transport services of two contractors viz., Natarajan and Annai Enterprises.
The assessee appealed against the order passed by the Commissioner of Customs and Central Excise (Appeals) for confirming the demand for Service Tax along with interest and also imposing the penalties.
Manoj Niranjan, the counsel for the assessee contended that as the distribution and the transmission utility are exempted from paying Service Tax concerning related services in terms of the exemption Notification No. 11/2010-ST and that the entire amount of Service Tax demanded was paid and as such the impugned order was not maintainable and invoking of the extended period was not justified as there was no violation of provisions of the Finance Act, 1994.
Harendra Singh Pal, the counsel for the department contended that the person who was liable to pay Service Tax was the consignor or a consignee and the assessee being a company registered under the Companies Act, 1956 will be liable to pay Service Tax for GTA Services received.
The Bench observed that the exemption under Notification No. 45/2010-ST dated 20.07.2010 and Notification No. 11/2010-ST was an omnibus exemption as the Notification does not exempt any particular category of taxable service but exempts ‘all taxable services relating to transmission of electricity and distribution of electricity’.
The two-member bench comprising P Dinesh (Judicial) and Vasa Seshagiri Rao (Technical) quashed the service tax demand while allowing the appeal filed by the assessee.
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