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2018 (11) TMI 924 - CESTAT AHMEDABADClassification of services - Business Auxiliary service or not - activity of collection of toll - AMTRL selected the Appellant for the design, construction, operation and maintenance of the Ahmedabad-Mehsana Road Project. The appellant was also awarded a contract for the purpose of operation and maintenance of the said road - extended period of limitation. Held that:- It is apparent that IL&FS has agreed to take up development, upgrading, repair, operation and maintenance of roads in the street on a ‘commercial basis’. The construction and operation and maintenance has been sub-contracted to the appellant by IL&FS through a corporate entity incorporated in the state and promoted by Govt. of Gujarat and IL&FS specifically for this purpose. From the above terms of the contract, it is apparent that the construction of road, and its operation and management have been undertaken strictly on commercial basis and the toll tax collected is being used for recovery of investment and operating cost on Build Own Operate Transfer (BOOT) basis. Merely because a project is funded by toll tax, it cannot be said no service has been provided. Especially on the ground that during the phase when the toll tax is collected, the property owned by a corporate, promoted by Govt. of Gujarat and IL&FS - it is apparent that the toll collected is a compensation given to a private operator for providing the services of road used to the public on BOOT basis. Thus, the facility and usage of road against payment of toll is a service provided by the AMTRL. Every user is a customer of AMTRL and the appellants are providing services to the customers (the users) on behalf of AMTRL and thus the activity would also be covered under clause (iii) of the definition of BAS. Time limitation - Held that:- The appellants are providing the BAS and there is no doubt regarding the same. Merely, because they are collecting the said amount on behalf of the corporate entity backed by Government it does not constitute a bonafide belief for exemption. The definition of BAS is very clear. Thus, they cannot be given any benefit on account of limitation. Appeal dismissed - decided against appellant.
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