In Service Tax Appeal No. 51779 of 2017-CESTAT- CESTAT (Delhi) partially allows appeal by HEG Limited & affirms fulfilment of essential conditions for Goods Transport Agency exemption; Penalty under section 77 of Finance Act upheld for failure to file returns on time
Members Dilip Gupta (President) & Hemambika R. Priya (Technical) [08-05-2023]

Read Order: HEG Limited v. Commissioner (Appeals) GST, Customs and Central Excise, Bhopal (M.P.)

Chahat Varma

New Delhi, May 9, 2023: The Principal bench of the Customs, Excise & Service Tax Appellate Tribunal has partially allowed the appeal filed by HEG Limited (appellant), holding that in order to claim exemption for Goods Transport Agency (GTA),the primary requirement was to provide a consignment note, and for commission agents the amount needs to be indicated. The show cause notice and the impugned order did not allege that the appellant did not export the goods or that there was a lack of consignment note or any other document in their name, therefore, it was concluded that the essential condition for availing the exemption notification [Notification no. 18/2009-ST dated 07.07.2009 & Notification no. 31/2012 dated 20.06.2012], was duly fulfilled.

The two-member bench of Dilip Gupta (President) & Hemambika R. Priya (Technical) examined the case of Commnr. Of Customs (import), Mumbai v. M/s. Dilip Kumar and Company [LQ/SC/2018/913], wherein the Supreme Court has emphasized that the interpretation of an exemption notification should be done strictly. It was stated that the burden of proving the applicability of the exemption clause or exemption notification lies on the assessee. The assessee must demonstrate that their case falls within the specified parameters of the exemption. The bench was of the view that the appellant had fulfilled the notification condition mentioned in column 4 of the relevant table and as a result, the demand for duty and interest that was upheld in the impugned order was set aside.

The bench further noted that the appellant was prompt in filing the intimation to seek exemption under the relevant notifications. However, there was a lack of similar promptness when it came to filing returns. The appellant did not take proper care to submit the required data and documents while filing the returns, despite having agreed to do so. As a result, the penalty under section 77 of the Finance Act for the failure to file returns on time was upheld.