By TIOL News Service

CHENNAI, JULY 14, 2015: APPELLANT is engaged in the manufacture of industrial gases and for this purpose, they have entered into an agreement with the buyers, where they have specially built "Vacuum Insulated Transport Tanks (VIST) at the customers site and maintain the same. Appellant received "Fixed Facility Charges" (FFC) from the customers. Appellant contended that once excise duty and VAT are discharged on FFC, then service tax cannot be demanded on the value again. Appellant relied on the decision of the Bangalore Bench of the Tribunal in their own case reported in 2014-TIOL-1984- CESTAT-BANG

Department contended that even if excise duty and VAT are paid, service tax is liable to be paid on FFC under the taxable category of "supply of tangible goods for use''.

The Tribunal found that prima facie case has been made out by the applicant for waiver of pre-deposit of service tax since the applicant has discharged excise duty on the value of FFC. The Tribunal also relied on the decision of Bangalore Bench in the applicant's own case in 2014-TIOL-1984-CESTAT-BANG where stay was granted on a similar issue. Accordingly, following the same, the Tribunal granted stay.

(See 2015-TIOL-1416-CESTAT-MAD)