TMI Blog2009 (6) TMI 67X X X X Extracts X X X X X X X X Extracts X X X X ..... t as well as on the ground of period of limitation. - ST/73/2005 - 829/2009 - Dated:- 23-6-2009 - Shri T.K. Jayaraman, Member (Technical) and Shri M.V. Ravindran, Member (Judicial) (Final Order No. 829/2009 dt. 23.6.2009 certified on 30.7.2009 in Appeal No. ST/73/2005) Shri B. Venugopal, Adv. for Appellant. Mrs. Sudha Koka, SDR for Respondent. Per T.K. Jayaraman: This appeal has been filed against Order-in-Appeal No. 24/2005 (H-II) S. Tax dated 29.7.2004 passed by the Commissioner of Customs and Central Excise (Appeals-II), Hyderabad. 2. We heard both sides. 3. Revenue proceeded against the appellants for demand of Service Tax of an amount of Rs. 6,85,199/- for the period from 1.7.2003 to 31.3.2004 under the category of 'Technical Inspection and Certificate Agency'. Interest also has been demanded. The appellant is American Quality Assessors (India) Pvt. Ltd. They are operating as licensed registrar under the office of American Quality Assessors (AQA), USA. In terms of the MoU, the appellant is to represent AQA, USA for the purpose of assisting clients in achievement of ISO9000, ISO-14000 and QS-9000. As per Para-1 (13) of the MoU with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fee from the prospective customer. (iv) Our attention was drawn to the definition of 'Technical Inspection and Certification Agency'. It was urged that in terms of Section 65 (108) and 65 (109) of the Finance Act, 1994, it is clear that: a. The inspection or examination should be of goods or process or material or any immovable property. b. The inspection or examination shall result in certification that such goods or process or material or immovable property qualifies or maintains the specified standards, including functionality or utility or quality or safety or any other characteristics or parameter. (v) In the instant case, the activity carried out by the appellant is merely an audit/assessment of quality, management system in an organization and has nothing to do either with the goods or process or material or any immovable property. In the impugned order, lot of stress has been give on the word 'process' appearing in the definition of 'Technical Inspection and Certification Agency' to being the activity of the appellant (with regard to quality management services of an organisation) under 'Technical Inspection and Certification Services ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al or chemical processes and not to management processes in an organization. Further, this activity is supposed to certify that the subject matter qualifies or maintains: * Specified standards, or * Functionality or * Utility or * Safety or * Any other characteristic parameters, * But does not include any service in relation to inspection and certification of pollution level. (viii) The above are applicable to inanimate things, appliances, mach or activities relating to operation of steps involving goods, things or mankind devices. There are hardly associated with management processes found in human organization including commercial and industrial organizations. Therefore, it would be proper to confine the scope of the definition of 'Technical Inspection and Certification' activity to examination of physical and mechanical process and goods which are susceptible to measurements and by 'Technical Inspection and Certification' does not suggest that it is intended to apply to study of management processes in an organization. (ix) In the present case, the appellants had on their own, approached the Department with regard to the taxability of thei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... #39;s Quality Management System for compliance to their laid down Quality Manual documentation. In case deficiency is noticed in the implementation of the system the audit highlights the same in the form of Non Conformance Report (NCR). On receipt of corrective actions taken by the client, the same are reviewed by AQA (I) for adequacy. On successful closure of the NCR, the audit pack is forwarded to AQA (USA) with a recommendation forward of certificates. Role of AQA , USA AQA (USA) reviews the audit findings in USA and puts up to their Registration Committee in USA for award of certificates. On approval by Registration Committee, the certificates will be awarded to the client and certificates contract is signed only between AQA, USA and the client. AQA (I) is not involved. In case Registration Committee does not quality the audit reports sent by AQA (I), the no certificates is awarded. Periodical Surveillance audits are conducted by AQA (I) in order to monitor the continued implementation of Quality Management System by the client. 5.2 No doubt the appellant receives certain consideration for the service rendered by them. Without going into the nitty gritty, w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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