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CUSTOM EXCISE & SERVICE TAX APPELLATE TRIBUNAL, MADRAS
MS. JYOTI BALASUNDARAM, Dr. Chittaranjan Satapathy, JJ.
Sree Vijaya Coaters -Appellant
Versus
Commissioner of Central Excise, Trichy -Respondent
STAY ORDER NO. 151 of 2010 APPLICATION NO. ST/S/359 of 2009 APPEAL NO. ST/608 of 2009
Decided On : 08-03-2010
K.S. Ramesh,C. Rangaraju
Ms. Jyoti Balasundaram, Vice-President - Heard both sides on the application for waiver of pre-deposit of service tax of Rs. 3,18,089 (Rs. 43,860 has already been paid) under section 76 of the Finance Act, 1994. The demand stands confirmed on the ground that the assessee was producing goods on behalf of its clients during the period in dispute viz., 10-9-2001 to 16-6-2005 (Show-cause notice covered the period from 10-9-2001 to 31-3-2006) but the Commissioner (Appeals) reduced the penalty.
2. The submission of the assessee is that they were producing goods for their clients and not on behalf of their clients and therefore, not liable to pay service tax for the period from 16-6-2005 as the definition in the Finance Act was amended only with effect from 16-6-2005 vide Notification 19/2005-ST, dated 7-1-2005 to cover the production of goods ‘for or on behalf of their clients’. Reliance is placed by the ld. Counsel on stay order of the Tribunal in Pearl Packaging v. CCE [Stay Order Nos. 12 & 13 of 2009, dated 9-1-2009] which has been followed in the stay order in the case of Veesons Energy Systems (P.) Ltd. v. CCE [Stay Order No. 253 of 2009, dated 15-4-2009]. Ld. Counsel also raised the plea that the entire demand is barred by limitation as, immediately on being directed, they have got registered with the Commissionerate of Service Tax and hence, it cannot be said that they were guilty of suppression of any fact from the department so to make available the extended period of limitation.
3. The prayer is opposed by ld. SDR who reiterates the findings of the authorities below, both on merits of the demand as well as on limitation.
4. After careful consideration of the submissions made by both sides, we find that the appellants have made out a prima facie case on merits in the light of the Tribunal’s decision and in the absence of any finding by the authorities below on the argument that the production of goods by the assessee was only for the client during the relevant period and therefore, we grant waiver of the pre-deposit of the amount in question and stay recovery thereof pending the appeal.
