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2019 (9) TMI 530 - AT - Service TaxClassification of services - Supply of Tangible Goods service or otherwise - appellant had received income under the head “Gas Connection Charges” from Industrial, Commercial and Domestic customers and perusal of the sale agreements and invoices, revealed that such charges were collected for supply of pipes and measuring equipments at the time of providing new gas connections to the customers - recovery alongwith Interest and penalty - benefit of cum-tax value. HELD THAT:- The service should be provided by any person to any other person for use of that person. In the present case, the appellant is distributing gas to its customers through pipes and for this purpose, it has installed an equipment called SKID at the customers’ site. It is true that the equipment is installed at the site of customer and at the cost the customer without transferring the ownership or possession and that the appellant retains the right to use the equipments, but the issue that arises for consideration is whether the supply of tangible goods, namely the equipment is for the use of the customer. The terms of the agreement leave no manner of doubt that the purpose of the equipment is to measure the amount of gas supplied to the customer for the purpose of billing. They are, therefore, for the use of the appellant and are not for use by the customers. The finding to the contrary recorded by the Adjudicating Authority is, therefore, not correct. The Adjudicating Authority was, therefore, not justified in confirming the demand of duty on the collection charges under the taxable service- ‘Supply of Tangible Goods’- In this view of the matter, it may not be necessary to examine as to whether the appellant refunds the collection charges to the customers on termination of the gas connection. Demand set aside - decided in favor of assessee.
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