SUNDARAM TEXTILES LTD. Vs. COMMISSIONER OF C. EX.

JUDGEMENT

(1.) THE appellants received goods transport operators service during the period 16 -11 -97 to 1 -6 -98, but did not pay any tax thereon under the Finance Act, 1994. In a show cause notice issued to them on 7 -3 -2001, the department demanded Service tax (with interest) from them and also proposed to impose penalties on them. The demand was contested. The original authority confirmed the demand of tax against the assessee and also ordered levy of interest on the tax amount for the period from 12 -6 -2000 to till date of payment. The first appellate authority upheld the decision of the lower authority. Hence the present appeal of the assessee.

(2.) AFTER examining the records and hearing both sides, I find that the short question arising for consideration in this appeal is whether, as recipient of goods transport operators service for the period of dispute, the appellants were liable to pay service tax to the department in terms of Sections 116 and 117 of the Finance Act, 2002. An identical issue was considered by this Tribunal in the case of L.H. Sugar Factories Ltd. v. CCE and it was held that goods transport service recipient had no liability to pay service tax on such service during the above period inasmuch as service recipients were not covered by the provisions of Section 73 of the Finance Act, 1994. The Tribunal's decision in L.H. Sugar Factories Ltd. (supra) was upheld by the Hon'ble Supreme Court in CCE v. L.H. Sugar Factories Ltd. reported in 2005 (187) E.L.T. 5 (S.C.).

(3.) FOLLOWING the above case law, I set aside the impugned order and allow this appeal with consequential relief to the appellants.