2015 (1) TMI 279 - AT - Service Tax

Waiver of pre deposit - Security Agency Services - Held that - Prima facie the services provided by the State of Rajasthan through the Superintendent of Police Udaipur pursuant to the enabling provisions of Section 46 of the Rajasthan Police Act 2007 to various firms persons organizations the income received by way of fee so received by the State of Rajasthan being remitted to the Government treasury constitutes income of the State derived as a consequence of performance of statutory functions. As such the services are prima facie excluded from the scope of taxable Security Agency Services in view of C.B.E. & C. Circular No. 89/7/2006-S.T. dated 18-12-2006 and Circular No. 96/7/2007-S.T. dated 23-8-2007 as amended by Circular No. 98/1/2008-S.T. dated 4-1-2008. Further whether a Union taxation measure may tax income of the State of Rajasthan in view of Article 289 of the Constitution also requires to be considered at the final hearing of the appeal. - Stay granted.

Summary

The Appellate Tribunal CESTAT NEW DELHI ruled that services provided by the State of Rajasthan through the Superintendent of Police are excluded from taxable "Security Agency Services." Full waiver of pre-deposit and stay of further proceedings granted. Consideration of Union taxation measure on the State's income required.