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2019 (2) TMI 1177 - AT - Service TaxClassification of services - tyre re-trading activity - whether covered under the category of management, maintenance or repair service or not? - consideration for charge of service tax - benefit of N/N. 12/2003 - Held that:- The activity carried out by the appellant is in the nature of retreading of tyres. Evidently, such activity is in the nature of repair and maintenance of tyres. The activity includes use of certain materials in the process of retreading. The appellant is found to charge a consolidated invoice for recovery of the charges from the customer. They were found to have imposed a stamp on the invoice indicating the split up of the overall invoice value into the material and spares cost as well as labour charge and have discharged the service tax liability only to the extent of labour charges. The only reason for denying the benefit of the Notification is that the documentary proof specifically indicating the value of the said goods and services was not available on the part of the appellant - In this connection an identical activity has been considered by the Hon’ble Supreme Court in the case of Safety Re-trading Co. Pvt. Ltd. [2017 (1) TMI 1110 - SUPREME COURT], where it was held that in terms of Section 67 of the Finance Act, 1994, the valuation of taxable services specifically excludes the cost of parts or other material, if any, sold to the customer while providing maintenance or repair service. The Apex Court has further held that this will include the deemed sale of material consumed in providing such service. Revenue has proceeded to deny the benefit of the Notification on the presumption that the same has been done after issuance of the invoice for manipulating the facts by showing lesser amount than shown in the invoice. No further investigation appears to have been done to substantiate the above presumption. There is no justification for denying the benefit of N/N. 12/2003 - appeal allowed - decided in favor of appellant.
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