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Service Tax - Case Laws
Showing 61 to 80 of 704 Records
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2020 (11) TMI 798 - GUJARAT HIGH COURT
Works Contract Services - business of construction of buildings and civil structures for last several decades - It is the case of the petitioner that, services rendered by the petitioner were actually in the nature of ‘Works Contract’ because petitioner entered into a contract with its client, wherein, transfer of property in goods involved in execution of such contract was leviable to tax - period from October, 2005 to March, 2006 - HELD THAT:- It emerges on record that the petitioner no.1 was rendering services classifiable as ‘works contract’. This fact has neither been disputed by the Commissioner nor by the Tribunal. That only because the petitioner no.1 registered itself for the service tax under the head of ‘commercial / industrial construction services’, the petitioner cannot be fasten its liability to pay service tax on the services rendered by it as ‘work contract’ services.
W.e.f. 01.06.2007 by entering (zzzza) in subsection 105 of Section 65 of the Act,1994 was introduced for the first time by the Finance Act, 2007 to cover the person as taxable person in relation to the execution of the works contract in respect of roads, airports, railways, transport terminals, bridges, tunnels and dams.
The Apex Court in GANNON DUNKERLEY & CO. VERSUS STATE OF RAJASTHAN & LARSEN & TOUBRO LTD. & UNION OF INDIA [1992 (11) TMI 254 - SUPREME COURT] was of the opinion that the service tax charging Section itself must lay down with specificity that the levy of the service tax can only be on works contracts, and the measure of tax only be on that portion of works contracts which contain a service element which is to be derived from the gross amount charged for the works contract less the value of the property in goods transferred in the execution of the works contract. In such circumstances, the Apex Court held that when the legislature has introduced the concept of service tax on indivisible works contracts then such contracts were never intended to the subject matter of the service tax, and therefore, such contracts, not being exempt under the Finance Act, 1994, cannot be said to fall within its tentacles, as which was never the intention of Parliament. The Apex Court, therefore, held that the levy of service tax on works contract was non-existent prior to 01.06.2007.
The contention raised on behalf of the respondents that as the petitioner had voluntarily registered under the head of ‘commercial /industrial construction services’, the petitioner is liable to pay service tax, is not tenable as the petitioner cannot be held to be liable to pay service tax prior to 01.06.2007, where, it is not in dispute that the petitioner was rendering ‘works contract service’.
Petition allowed.
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2020 (11) TMI 797 - CESTAT HYDERABAD
Rectification of Mistake - error apparent on the record - typographical error or not - the foreign exchange in respect of appeal has been realised on 27.04.2016, 27.05.2016 & 28.06.2016 but the claim was filed only on 28.07.2017 - HELD THAT:- There was indeed a typographical error in mentioning the date of receipt of foreign exchange as 27.04.2016 instead of 27.07.2016. However, since this is not a case pertaining to the transitional period where the exports were made prior to 01.03.2016 and refund claim filed after the date, the ratio of the judgment of the Hon’ble Larger Bench in the case of CCE & CST, BENGALURU SERVICE TAX-I VERSUS M/S. SPAN INFOTECH (INDIA) PVT. LTD. [2018 (2) TMI 946 - CESTAT BANGALORE] does not apply.
It does not come to the rescue of the appellant since the application for refund was filed after one year from the date of receipt of the foreign exchange even after rectifying the mistake. Accordingly, the application for rectification of mistake is disposed of as follows:
“The date 27.04.2016 mentioned in paragraph 10 of the final order may be read as 27.07.2016.”
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2020 (11) TMI 796 - KERALA HIGH COURT
Recovery of Refund of service tax already granted - service tax paid under a mistake of law? - relevant date - Section 11B of the Central Excise Act - Business Auxiliary Service - HELD THAT:- When a payment is made erroneously, the relevant date is the date of payment. However, when an order in original is passed imposing the liability and a payment is made in consequence of that, the relevant date is the date on which an appeal or revision from the order is allowed.
In the present case, as is discernible from Annexure-B, a show cause notice was issued 06.11.2007, prior to which the assessee had made payments on 31.03.2007 and 23.05.2007. Hence the payments now sought for refund were made even prior to the show cause notice issued. The show cause notice culminated in, the order-in-original dated 02.03.2012, which obviously is with respect to the liability after 18.04.2006. This does not even indicate the assessee having paid the tax under protest earlier to the show cause notice; in which event, the second proviso to Section 11B makes inapplicable the limitation of one year from the relevant date, for filing an application for refund.
The respondent-Revenue are restrained from recovering the amounts refunded since as of now the levy of service tax on the payment in lieu of foreign agency commission will not be leviable as 'Business Auxiliary service' prior to 18.04.2006 - appeal allowed in part.
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2020 (11) TMI 754 - MADRAS HIGH COURT
Maintainability of petition - only point of dispute is that Assessee could not file the Appeal within the prescribed time limit of 4 weeks as granted by the learned Single Judge due to overriding reasons and indulgence is now sought to file the said Appeal before the Commissioner within 4 weeks from now - HELD THAT:- The time limit given by the learned Single Judge does not deserve to be extended except subject to the condition of deposit of 50% of the demand under the impugned order dated 27.9.2010.
It is directed that subject to deposit of ₹ 1,50,000/- by the Petitioner/Assessee within 4 weeks from today and filing of the Appeal within 4 weeks from today, the Appeal may be heard and decided on merits in accordance with law by the Commissioner of Service Tax (Appeals) - appeal disposed off.
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2020 (11) TMI 753 - CESTAT BANGALORE
Non-payment of service tax - Management or Business Consultant Service or Information Technology Software Service? - modification and customization of software, install the software for use on the equipment for trading, providing support through remote access using the internet as a medium, sending engineers to the site of customers, provide additional training required by the customer from time to time - HELD THAT:- The learned Commissioner after examining the services rendered by he appellant has come to the conclusion that the activities carried out by the appellant is covered under the category of Enterprise Resource Planning (ERP) Software Application and the same is rightly classifiable under the category of Management or Business Consultant service and are liable for service tax - After carefully considering the definition of Management or Business Consultant Service and Information Technology Software Service, it can be concluded that Enterprise Resource Planning implementation would not be covered under Management or Business Consultant service.
Further, as per the terms of the Agreement entered into between the appellant and their clients, the activities undertaken by the appellant are covered under the definition of Information Technology Software Service as specifically covered under the Information Technology Services as taxable under Section 65(105)(zzzze) with effect from 16.5.2008. Further, the activities alleged in the show-cause notice clearly fall within the ambit of Information Technology Software Service as defined in the Finance Act, 1994.
The issue involved in the present case is no more res integra and has been settled by various decisions of the Tribunal and the apex court. In this regard, it is pertinent to mention that this Tribunal in the case of IBM India Pvt. Ltd. [2009 (4) TMI 314 - CESTAT, BANGALORE] has specifically held that implementation of Enterprise Resource Planning does not attract service tax under the category of Management or Business Consultant Service.
Time Limitation - HELD THAT:- The period involved in the present case is from 1.3.2006 to 15.5.2008 whereas the show-cause notice was issued on 8.4.2011 by invoking the extended period of limitation alleging suppression of facts with intent to evade payment of tax by the appellant - the appellant has been regularly filing the returns and was under bona fide belief that their activities are not liable to service tax under Management or Business Consultant Service. It is not disputed that the appellant is paying service tax with effect from 16.5.2008 under the category of Information Technology Software Service. Moreover, the department was very much aware of the activities of the appellant as the department conducted audit of the accounts of the appellant from time to time and the last audit was conducted in December 2009 but has not raised any objections regarding the activities of the appellant, hence, allegation of suppression of material facts against the appellant is not sustainable.
Appeal allowed on merits as well as on limitation.
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2020 (11) TMI 666 - KERALA HIGH COURT
Recovery of Refund of service tax - foreign agency commission rendered - services rendered prior to 18.04.2006 - Applicability of Section 66A in the Finance Act, 1994 - HELD THAT:- This Court in SOUTHERN SURFACE FINISHERS AND THRICHUR DISTRICT PADDY MARKETING AND PROCESSING CO-OPERATIVE SOCIETY LIMITED VERSUS THE ASSISTANT COMMISSIONER OF CENTRAL EXCISE, MUVATTUPUZHA AND THE ASSISTANT COMMISSIONER OF CENTRAL EXCISE, THRISSUR [2018 (11) TMI 1208 - KERALA HIGH COURT] considered the Constitution Bench decision and found that the mistake if committed by the assessee, whether it be on law or facts; the remedy would be only under the statute. If that be so, the questions of law have to be answered in favour of the Revenue and against the assessee. But, however, we notice that the amounts have been refunded to the assessee as per the order of the original authority.
Though, the question of law is answered in favour of the Revenue, the Revenue to be incapable of recovery of the amounts refunded as tax due - appeal is disposed of, answering the questions of law in favour of the Revenue; but restraining the respondent-Revenue from recovering the amounts refunded since as of now the levy of service tax on the payment in lieu of foreign agency commission will not be leviable as 'Business Auxiliary service' prior to 18.04.2006.
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2020 (11) TMI 624 - CESTAT HYDERABAD
Works Contract Service - exemption under Sl. No. 12(a)/12A of Notification No. 25/2012-ST dated 20.06.2012 - erection, commissioning and installation of transmission lines for various Government companies / corporations - service tax on the reimbursement of amount towards crop compensation, right of way, from the service recipient, being incidental to the works contract executed - Difference of Opinion.
HELD THAT:- In view of difference of opinion, the following question(s) arise for consideration.
1. Whether the view of Member (Judicial) is correct, holding that within the extended meaning of Article 243W, read with 12th Schedule of the Constitution, ‘Transmission and Distribution of Electricity’ is included;
Or
as held by learned Member (Technical) that ‘Transmission and Distribution of Electricity’ is not included in Article 243W read with 12th Schedule of the Constitution?
The Registry is directed to place the records before Hon’ble President for appointment of learned third Member to give opinion on the point(s) of difference.
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2020 (11) TMI 622 - CESTAT KOLKATA
Taxable Service or not - payment of remuneration in the nature and form of commission based on percentage of profit to whole time directors - reverse charge mechanism (RCM) - demand of service tax on fixed part as well as the variable pay - benefit of N/N. 30/2012-S.T., dated 20th June 2012 - It is the case of the Department that the said remuneration paid to the Directors would constitute ‘service’ liable to service tax in the hands of appellant assessee under reverse charge mechanism - HELD THAT:- Section 2(94) of Companies Act, 2013, duly defines ‘whole-time director’ to include a director in the whole-time employment of the company. A whole-time Director refers to a Director who has been in employment of the company on a full-time basis and is also entitled to receive remuneration. The certificate issued by the company secretory states that the remuneration is given in various form as allowed under the Companies act, 2013.
The whole-time Director is essentially an employee of the Company and accordingly, whatever remuneration is being paid in conformity with the provisions of the Companies Act, is pursuant to employer-employee relationship and the mere fact that the whole-time Director is compensated by way of variable pay will not in any manner alter or dilute the position of employer-employee status between the company assessee and the whole-time Director - thus, when the very provisions of the Companies Act make whole-time director (as also in capacity of key managerial personnel) responsible for any default/offences, it leads to the conclusion that those directors are employees of the assessee company.
Since demand of service tax is set aside, penalty and interest are also not sustainable.
Appeal allowed - decided in favor of appellant.
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2020 (11) TMI 621 - CESTAT NEW DELHI
CENVAT Credit - proper invoices or not - validity of invoices/ bills issued to their office which is unregistered - requirement of Central Excise Registration or ISD Registration for availing CENVAT credit on the invoices issued on a different address - rule 4A of the 1994 Rules read with rule 9 of the 2004 Rules.
HELD THAT:- Once the requirement of rule 4A of the 1994 Rules and rule 9 of the 2004 Rules are satisfied, the benefit of CENVAT credit could not have been demanded. Thus, the Commissioner was not justified in denying the benefit of CENVAT credit on the unregistered premises.
The Commissioner has further held that the benefit of CENVAT credit for services received by the Appellant on the strength of invoices addressed to another unit is not admissible as the Appellant failed to take Central Registration or ISD Registration to avail and distribute the CENVAT credit - This finding of the Commissioner is also not correct. There is no law that prescribes that the only way to distribute CENVAT credit is registering as an ISD.
It has also contended by learned Counsel for the Appellant that no service tax was payable in respect of services imported prior to April 18, 2006. In this connection it has been pointed out that demand on ₹ 7038 was confirmed in respect of services imported from M/s P L Design Company Limited during the period 2005-06. The amount of service tax has been paid by the Appellant and it has also been appropriated in the impugned order. It is, therefore, not necessary to decide this issue.
Except for the demand of ₹ 7038/- that has been appropriated, the remaining demands confirmed by the Commissioner in the impugned order are set aside - Appeal allowed - decided in favor of appellant.
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2020 (11) TMI 619 - CESTAT CHENNAI
Valuation - inclusion of balance amount which is in the nature of Travelling Expenses and Boarding Expenses - reimbursable expenses or not - HELD THAT:- The demand is made on the amount that has been incurred by the appellant for travelling as well as lodging expenses. These are nothing but reimbursable expenses and the appellant has paid service on Audit Fee received as consideration for the service rendered - Demand do not sustain - appeal allowed - decided in favor of appellant.
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2020 (11) TMI 584 - KERALA HIGH COURT
Validity of appeal preferred by the respondent against an order of assessment under the Finance Act, 1994 - amnesty scheme in vogue - According to the petitioner, if he had been informed of the appeal having been preferred by the revenue, when the amnesty scheme was in vogue, he would have applied for the Amnesty scheme with a view to put the quietus to the matter and would not have had to contest the appeal preferred by the revenue - HELD THAT:- The petitioner has no statutory right to be informed of an appellate right exercised by the revenue, before a communication to that effect is sent to him by the appellate authority prior to the hearing of the appeal. The petitioner cannot also be seen as prejudiced in any manner merely because the intimation of the revenue appeal was received by him after the expiry of the amnesty scheme. His option for the amnesty scheme was not dependent upon whether or not the revenue preferred an appeal against the order of the assessing authority. The petitioner has not made out a case for the reliefs sought for in the writ petition.
Petition dismissed.
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2020 (11) TMI 583 - CESTAT BANGALORE
Application for early hearing of the present appeal - recovery of portion of the service tax amounting to ₹ 50,00,000/-, which was already deposited by the appellant on 08/03/2013 itself - HELD THAT:- This is a fit case for granting early hearing and accordingly, the early hearing application is allowed - Registry is directed to list this case for final hearing on 09/11/2020.
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2020 (11) TMI 582 - CESTAT MUMBAI
CENVAT Credit - input services - service tax paid on the insurance premium paid to DICGC - service tax paid on the commission paid to the brokers for underwriting the government securities etc and for making investments in securities to maintain mandatory SLR as per the Banking Regulation Act, 1949 - levy of penalty.
HELD THAT:- Matter referred to Hon’ble President for referring the matter to larger bench, for resolving the issues as follows:
a. Whether the interpretation of the legal provisions contained in Section 65 and 66 of the Finance Act, 1994 made in the decision of the CESTAT, in case of South India Bank, satisfy to the test laid down by the five member bench of Hon’ble Supreme Court in case of Dilip Kumar and Co, referred above.
b. Whether the CENVAT credit of the Service Tax paid on the services availed to fulfill a statutory obligation, should be admissible even if the services availed do not otherwise qualify to be input services as defined under rule 2(k) of the CENVAT Credit Rules, 2004 as amended.
c. Whether Rule 6(3B), of the CENVAT Credit Rules, 2004, is an authority for the banks to claim the credit in respect of all the services without establishing that the services under consideration are the common input services for providing the exempted and taxable services.
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2020 (11) TMI 581 - CESTAT BANGALORE
Non-imposition of penalty u/s 76 of FA - Commercial or Industrial Construction Services - Department submits that Section 78 of Finance Act, 1984 was amended w.e.f. 10.05.2008 only to provide that penalty under Section 76 need not be imposed if penalty under Section 78 is imposed - Effect of amendment, retrospective or prospective? - Difference of Opinion.
HELD THAT:- In view of the difference of opinion, the following questions arise for consideration by the learned 3rd Member:-
(1) Whether penalty under Section 76 and 78 are prescribed for different type of violations and are mutually exclusive as held by Member (Judicial)
OR
that both the penalties can be imposed simultaneously as held by Member (Technical).
(2) Whether the amendment brought in Section 78 by Finance Act, 2008 by addition of proviso (w.e.f. 10.5.2008) providing that where penalty is imposed under Section 78 no penalty is imposable under Section 76, is clarificatory in nature, have got retrospective effect, as held by Member (Judicial) or whether the aforementioned amendment is not retrospective but prospective and hence the simultaneous penalties can be imposed for the period prior to 10.5.2008 as held by Member (Technical).
(3) As held by Member (Judicial) in view of Section 80 of the Finance Act, 1994, dropping of penalty under Section 76 by the adjudicating authority is not questionable or as held by Member (Technical), the penalty under Section 76 dropped by the adjudicating authority should have been imposed?
(4) As held by Member (Judicial) that the ruling of Kerala High Court in the case of ACCE Vs. Krishna Poduwal [2005 (10) TMI 279 - KERALA HIGH COURT] is not applicable in the present case as that ruling is prior to the amendment dated 10.5.2008 in Section 78 or as held by Member (Technical) that the aforementioned ruling is applicable and simultaneous penalty under Section 76 and 78 are imposable?
Registry is directed to put up the appeal record before Hon’ble President for nomination of 3rd Member to consider the aforementioned questions and difference of opinion for his opinion.
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2020 (11) TMI 580 - CESTAT KOLKATA
Nature of services - applicability of service tax or VAT - glass bottles and crate rentals - Supply of tangible goods service or not - Appellant has contended that the supply of glass bottles and crates amounted to deemed sale, which was liable to VAT/sales tax as the effective control and possession of the goods were transferred by the Appellant - extended period of limitation - demand of interest and penalty - HELD THAT:- The issue is settled by the judgment of the Hon’ble Andhra Pradesh High Court in the Writ Petitions No. 21115/2005, No. 856/2006 and No. 25588/2007 [2013 (1) TMI 1009 - ANDHRA PRADESH HIGH COURT], where it was held that such crate rentals would be liable to VAT/Sales tax on the ground that it amounted to deemed sale of crates inasmuch as there was transfer of right to use with effective control and possession of crates. It is trite that the transactions which are deemed sales cannot be liable to service tax. Also, it is seen from the order of the learned Adjudicating authority that he has not at all considered the submissions of the Appellant as regards payment of VAT on the said rentals.
Further, when the aerated beverages are supplied by the Appellant to its customers, the possession as well as effective control of the said bottles along with crates in which they are supplied to keep them free from spillage and breakage, is also passed by the Appellant assessee as the Appellant cannot govern the action of its customers as to how the customers would deal with such crates and bottles once supplied.
The definition of supply of tangible goods states that when there is supply of use of goods without transferring right of possession and effective control of the equipment, the same would fall within the category of supply of tangible goods service - However, in the instant case of the appellant, the entire goods are handed over to the customer who gets the effective possession as well as control to use the goods. Hence, the observation of the Ld. Adjudicating authority that the control and possession has not been passed is not justified and hence is liable to be rejected.
Extended period of Limitation - HELD THAT:- The demand has been raised for the period 2011-12 in 2017 onwards whereas the spot memo was issued by the Department in 2014 itself. No explanation has been furthered by the Department in respect of such gross delay in proceeding with the matter. Therefore, we find that invocation of the extended period of limitation is not justified.
Demand of interest and penalty - HELD THAT:- Since demand of service tax is set aside, penalty and interest are also not sustainable.
Appeal allowed - decided in favor of appellant.
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2020 (11) TMI 552 - KARNATAKA HIGH COURT
Tax Relief under the SVLDR Scheme - application for Tax Relief rejected on the ground that there is error in filling up Form No.SVLDRS-1 - HELD THAT:- In the present case there is no dispute about the petitioner being issued with Audit Note dated 04.04.2019 which mentions not only the duty demand but also the service tax recovered from the petitioner, and thus, there has been quantification of the duty demand in a sum of ₹ 23,86,861/- and acceptance of service tax recovered in ₹ 8,09,269/- during audit before the 30th day of June, 2019. There is also no dispute that the petitioner satisfies the other conditions of the SVLDR Scheme and is entitled to avail the tax relief. If these facts cannot be disputed and the conditions as contemplated under the SVLDR Scheme are satisfied, an accrued substantive right by way of Tax relief cannot be denied on the technical ground that there is an error in filling in the details in Form-SVLDRS as ‘Nil’, especially when there is an onus on the Department to verify the records. The technical glitch asserted by the petitioner while filling in the details in Form SVLDRS-1 is not seriously contested.
In the peculiar facts and circumstances of the case, including the fact that the petitioner is not extended an opportunity as contemplated under the provisions of section 127(3) of the SVLDR Scheme with the issuance of Form SVLDRS-2 and an error apparent in Form SVLDRS-3 cannot be controverted, and also in view of the fact that the SVLDR scheme is envisaged as a time bound exercise, this Court is of the considered opinion that the petitioner is entitled for issuance of Discharge Certificate as contemplated under Section 127(8) of the SVLDR Scheme.
The writ petition is allowed in part directing the Designated Committee to expeditiously consider issuance of Discharge Certificate to the petitioner as contemplated under Section 127(8) of the SVLDR Scheme.
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2020 (11) TMI 538 - CESTAT AHMEDABAD
Short payment of Service Tax - Works Contract Services - Commercial of Industrial Building and Civil Structures and Erection Commissioning and Installation service - period is from October, 2004 to March, 2007 i.e. before 01.06.2007 - HELD THAT:- There is no dispute that the service provided by the appellant is otherwise specified under Works Contract Service. The criteria for qualification of Works Contract Service is that the service should be provided along with material. It is obvious that when the services on construction is provided along with the material the assessee needs to pay VAT or the Works Contract Tax.
From the above contract it is seen that the appellant is required to provide the service along with material like Cement, Metal, Steel Reinforcement, Sand, Charcoal, Salt and Earting Material. Moreover, in respect of the Works Contract Service the recipient of the service will deduct the Works Contract Tax which shows that the works contract service is suffered with works contract tax. As per this fact there is absolutely no doubt that the nature of service as well as facts such as service provided along with the material and it suffered works contract tax which clearly qualifies as Works Contract Service - When the revenue itself has allowed the abatement, it has admitted that the material cost is included in the gross value of the Works Contract Service. With this fact also, it is clearly established that the service provided by the appellant is Works Contract Service.
As per the Hon’ble Supreme Court’s judgment in the case of COMMISSIONER, CENTRAL EXCISE & CUSTOMS VERSUS M/S LARSEN & TOUBRO LTD. AND OTHERS [2015 (8) TMI 749 - SUPREME COURT] the works contract service is not taxable before 01.06.2007. In the present case, the entire period is prior to the said date therefore, in view of the apex court judgment the service being Works Contract Service is not taxable.
Appeal allowed - decided in favor of appellant.
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2020 (11) TMI 537 - CESTAT KOLKATA
Levy of Penalty u/s 78 of FA - Non-payment of service tax - Renting of Immovable Property Service - amnesty scheme - VCES scheme - HELD THAT:- The service tax has been duly paid and informed to the Department well before the issuance of Show Cause Notice Applicable interest has also been deposited subsequently as noted by the Learned Commissioner (Appeals) in the impugned order. The tax amount for the period in dispute has been deposited together with the previous period covered under the VCES scheme in installments as noted in the original order - There are no positive evidence has been brought on record in the entire proceedings that non-payment of tax was attributable to reasons to deliberately evade payment of tax.
Moreover, the appellant is a PSU in the instant case. The Courts have consistently held that there is a presumption that PSU would not have intention to evade payment of duty or tax.
Penalty do not sustain - appeal allowed - decided in favor of appellant.
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2020 (11) TMI 536 - CESTAT NEW DELHI
Levy of Service Tax - Healthcare services/Business Support Services - revenue sharing - whether service tax is payable by the appellant for having allowed usage of the infrastructure provided by it to the contracted doctors? - HELD THAT:-This precise issue was considered by the Tribunal in connection with the earlier show cause notice to the appellant which involved the period both before and after July 1, 2012. The Tribunal held, after a careful consideration of the conditions prescribed in the agreement, that the arrangement was for joint benefit of both the parties with shared obligations, responsibilities and benefits.
The Commissioner was not justified in confirming the demand of service tax under “business support service” - Appeal allowed - decided in favor of appellant.
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2020 (11) TMI 534 - CESTAT NEW DELHI
Classification of services - Cleaning services or not - Appellant is engaged in the manufacture of lubricating oil/ grease and break oil and also in the refining of waste oil - Department formed a view that by incinerating the waste of other industries, the Appellant was rendering ‘cleaning activity’ services in terms of section 65(24b) of the Finance Act, which is taxable under section 65(105) (zzzd) of the Finance Act - HELD THAT:- A reading of the scope of cleaning activity under section 65(24b) of the Finance Act would indicate that the essence of the activity is to clean either an object which is present within the premises or the premises itself of a commercial building/factory/plant or machinery. These services are rendered by the service provider at the premises of the recipient, where the intended objects or premises are required to be sanitized. Thus, the taxable service of 'cleaning' would include only those services wherein the cleaning activity has been undertaken at the premises of the service recipient.
Incineration of waste is a process involving destruction of waste/residue at high temperatures, which has been undertaken by the Appellant at its own plant. The waste of other industries which is intended to be incinerated by the Appellant is delivered by the industries to the premises of the Appellant. It is not a case where the Appellant goes to the premises of the industries to perform any cleaning activity. Instead, the waste is delivered to the site of the Appellant in safe leakage proof bags by the industries for proper disposal. The industries are not concerned with the waste thereafter.
It is clear that 'exterminating of objects’ covers destroying insects, rodents and other pests in respect of objects/premises. Hence, the term ‘extermination’ has to be in connection with activities such as fumigation; pest control or other such activities which are in the form of treatment of premises / objects against animal or pest infestation. The impugned order, therefore, erred in treating the term ‘extermination’ as being equivalent to ‘incineration’ - It would be also be pertinent to refer to the CBEC Circular dated July 13, 2007 which specifically provides that incineration of waste is not taxable under business auxiliary service or any other taxable service.
Demand do not sustain - appeal allowed - decided in favor of appellant.
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