U.B. XPRESS (SOUTH) PVT. LTD. Vs. CCEST

JUDGEMENT

(1.) THIS is an application filed by M/s. U.B. Xpress (South) (P) Ltd., for waiver of predeposit and stay of recovery of a demand of service tax of Rs. 1,37,920/ -, equal penalty imposed under Section 78 of the Finance Act, '94 (the Act), penalty @ Rs. 200/ - per day till payment of the service tax under Section 76 of the Act and appropriate interest due in terms of Section 75 of the Act. The impugned order affirmed the order of the original authority. After listening to the arguments of both sides on the stay application, the requirement of predeposit is waived and the appeal itself is taken up for final disposal.

(2.) THE facts in brief are that the appellants provide service under the category of 'Courier Service'. During the period 15.03.05 to 16.06.05, the appellant was engaged in international courier service but did not pay any service tax. The Commissioner found that the service engaged in by the appellant which involved transport and delivery of articles and documents abroad could not be held to be service partly rendered in India and partly abroad. Therefore tax had to be paid on what the appellant describes as international courier service.

(3.) THE Ld. Counsel for the appellants submits that as per Rule 3 of Export of Services Rules, 2005, as it existed at the material time, export of taxable service meant, among others, 'Courier Service' falling under Sub -clause (f) of Clause 105 of Section 65 of the Act if such taxable service was partly performed outside India. As per Rule 4 of the said rules, any service which was taxable under Clause 105 of Section 65 could be exported without payment of service tax. Rule 3 of Export of Services Rules, 2005 was amended by Notification No. 28/2005 -Service Tax dated 07.06.2005, by adding a proviso to Sub -rule 1 amending definition of taxable service as that delivered outside India for any purpose and payment for which was received by the service provider in convertible foreign exchange.