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Service Tax - Case Laws
Showing 61 to 80 of 185 Records
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2017 (7) TMI 799 - CESTAT HYDERABAD
CENVAT credit - input services - denial on the ground that the invoices being not in the name of the appellant and CENVAT credit was availed prior to registration - whether the service tax paid on Works Contract Services, Project Management and Architectural Professional Services can be considered as input services for the appellant when these services are used for construction of hotel? - Held that: - It is undisputed that the services are utilized for brining to existence building which is used by the appellants for hospitability business and is used for rendering output services like mandap keeper and health club and fitness centre and dry cleaning service and internet cafe services. It is an unimaginable that a hotel can render these services without a building in its place - the input services are availed by the appellant in respect of Works Contract Services, Project Management Services and Architectural Professional Services used for construction of a building, which subsequently is put into use for rendering taxable output services.
Input services includes the services used in relation to settingup, modernization, renovation of premises of provider of output services.
Avaliment of CENVAT credit on the input services which are used for brining into existence of immovable property are also eligible for availment of CENVAT credit - appeal allowed - decided in favor of appellant.
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2017 (7) TMI 798 - CESTAT HYDERABAD
Works contract - commercial or industrial construction services - whether construction activity undertaken by the appellant prior to 01.06.2007 for construction of quarters for CRPF, office building for HAL, administrative building for BSNL, convention hall for APTDC whether liable to be taxed under commercial or industrial construction services or construction of complex services or otherwise? - Held that: - In respect of the construction activities undertaken prior to 01.06.2007, we find that the adjudicating authority has clearly recorded that these construction activities were undertaken by the appellant under EPC contract; there being such a clear finding not contested by revenue as an admitted fact, then in our considered view the same needs to considered on works contract services.
Whether post 01.06.2007 the above construction would be taxable under works contract or otherwise? - Held that: - Post 01.06.2007, the construction activity undertaken by the appellant for the Government organizations are not taxable, is the claim of the appellant which has been rejected by the adjudicating authority on a finding that appellant had undertaken this activity of construction of quarters as a sub-contractor for Central Public Works Department (CPWD).
Whether construction activity undertaken by appellant for private parties is taxable prior to and post 1.6.2007 or otherwise and whether the penalty is imposable on the appellant on the amount of tax not paid in respect of activity undertaken for private parties? - Held that: - As regards service tax liability in respect of work of construction executed of various private parties prior and post 01.06.2007, we find that it is the claim of the Ld. Counsel for appellant that they have discharged the service tax liability in toto along with interest; it is also the claim of the appellant that they had not collected any service tax from these private parties prior to 01.06.2007 while the adjudicating authority has recorded a finding that they have collected the tax from private parties. Since it is the claim of the appellant that they have not collected any tax prior to 01.06.2007 and discharged tax liability post 01.06.2007, claims needs to be verified by the lower authorities from the documents that may be produced by the appellant.
The question of visiting the appellant with any penalty does not arise even in the case of tax liability in respect of the works executed for private parties.
Appeal allowed in part and part matter on remand.
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2017 (7) TMI 797 - CESTAT CHENNAI
Penalty - case of Revenue is that the credit, so availed by the appellant, was not available inasmuch as the imported capital goods were not being used by them in the manufacture of the final products and were being hired out - Held that: - the assessee is not disputing the fact that the imported Hydraulic system was not at all used by them in their manufacturing activities and was hired out - It is also a fact that the credit of more than ₹ 10 lakhs was availed during the long period of June, 2009 to June, 2011 and was detected by the Prevantive Officers during the course of their visit in November, 2011 only. As such, it can be safely concluded that the appellants adopted the system of availing credit of duty paid on capital goods used in the manufacturing activities with an intention to avail credit not available to them and may be to take a chance. It is also a fact that as soon as the objection was raised by officers, the appellants paid back the entire credit immediately along with interest.
Taking into consideration that the appellants paid back the credit immediately on being pointed out by the Revenue along with payment of interest and keeping in mind the fact that the penal proceedings were initiated against them, after a gap of three years, I deem it fit to restrict the penalty to 25% of the total duty amount in terms of proviso to section 78 of the Finance Act, 1994 - appeal allowed - decided partly in favor of appellant.
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2017 (7) TMI 784 - CESTAT HYDERABAD
Commercial coaching and training services - Amount charged for training under Abacus - taxability - SSI exemption - Penalty - Held that: - the taxability of the amount charged for training under Abacus is still before the Hon'ble Supreme Court for the final decision and subsequently various Benches of Tribunal have come to a conclusion that an amount collected Abacus training is not taxable with effect from 2012.
As regards the issue for demand of service tax liability on training of English Language finding the said taxability was contested before various matters before the Tribunal, the Bench finally decided the English Language training is covered under the Head of Commercial Coaching in Training Class Services. Since this issue settled by the Tribunal we are of the view these would a bonafide belief in the mind of appellant as to non-taxability of the amount received by them. In view of this, we hold that provisions of Section 80 can be invoked in the case in hand penalties liable to be imposed on the appellant in respect of the Abacus and English Language training can be set aside.
Appeal allowed - decided in favor of appellant.
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2017 (7) TMI 764 - MADRAS HIGH COURT
Natural justice - the Tribunal proceeded to pass the aforementioned order since, there was no appearance on behalf of the appellant although opportunity was granted in that behalf - appellant's contention is that they must be given opportunity of being heard - Held that: - since, the appellant says that the proceedings of the Tribunal are not correctly reflected in the impugned order, the only remedy available to the appellant would be to approach the Tribunal by way of an appropriate application to rectify the record - appeal dismissed - decided against appellant.
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2017 (7) TMI 763 - CESTAT HYDERABAD
100% EOU - refund of CENVAT credit availed on input services - denial on the ground that these are not eligible input services - Held that: - there is no dispute as to the fact that the Respondent is an exporter of services and is registered with the Authorities. There is no dispute also that the Respondent had been exporting the services and filed refund claims - The jurisdictional Bench of the Tribunal has held in a catena of judgments, that the impugned services are eligible input services, and thus eligible for refund under Rule 5 of CCR, 2004 - refund allowed - appeal dismissed - decided against Revenue.
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2017 (7) TMI 762 - CESTAT MUMBAI
Classification of service - Manpower Recruitment or Supply Agency service - the appellant as per the contract with M/s. Kalyani Lemmerz Ltd., providing the job of producing or processing in the premise of Kalyani. The terms of the job is on per piece basis - whether the service provided by the appellant to Kalyani is of Manpower Recruitment or Supply Agency service or otherwise? - Held that: - though the department has proposed the service of the appellant as classifiable under Manpower Recruitment or Supply Agency service but no evidence was adduced to conclusively hold that the service is of Manpower Recruitment or Supply Agency service. The figure of the service tax was retrieved from the bank account which does not show what is the basis of the service charge by the appellant to the service recipient. Therefore, we do not find any material evidence in the show-cause notice to hold that the appellant are providing Manpower Recruitment or Supply Agency service.
From the reading of the agreement and Annexure A it can be seen that the service is the production ancillary associates and rates for the service is on per piece rate of the pieces produced. Therefore the appellant's job is not to depute the labour to the service recipient, irrespective of the number of labours, the respondent has to perform the job of producing piece for the service recipient and the rate is on per piece basis. Therefore, the wages/ salary or emolument paid to the labour is not relevant to the service recipient. That is the responsibility of the appellant. Against this evidence the department right from show-cause notice up to the Commissioner (Appeals) could not bring any material to show that there is arrangement between the appellants and service recipient there is arrangement of supply of manpower.
Since the department could not establish that the service provided by the appellant are of supply of manpower, the demand on the said service is not sustainable - appeal allowed - decided in favor of appellant.
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2017 (7) TMI 761 - CESTAT KOLKATA
Refund claim - N/N. 41/2007-ST dated 06.10.2007 as amended - denial on the ground of time limitation - Held that: - N/N. 41/2007-ST prescribed limitation of 60 days from the end of quarter which was amended by N/N. 32/2008-ST dated 18.11.2008 and extended the period of limitation to six months from the end of the quarter - the Tribunal had consistently viewed following the Circular dated 12.03.2009, that the refund claim for quarter ending March, 2008 filed under N/N. 41/2007-ST as amended by Notification No.32/2008, the limitation would be six months and effective retrospectively - In the present case, the respondent filed a refund claim on 03.07.2008 for the quarter ending on March, 2008, claim filed within time - appeal dismissed - decided against Revenue.
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2017 (7) TMI 760 - CESTAT ALLAHABAD
Refund claim - rejection on the ground that the CENVAT credit was not admissible to the appellant - Held that: - in the present case no such show cause notice issued to the appellant for denial of Cenvat Credit availed under Rule 14 of Cenvat Credit Rules, 2004 - if the show cause notice has not been issued for disallowing Cenvat Credit by invoking Rule 14 of Cenvat Credit Rule, 2004 then subsequently such credit could not be denied to be refunded if the other conditions for refund are satisfied.
We therefore, find it proper to remand the matter back to the file of Learned Commissioner (Appeals) with direction to re-determine the issue of refund of ₹ 1,19,18,476/- - appeal allowed by way of remand.
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2017 (7) TMI 727 - KERALA HIGH COURT
"Sale" of used cars - motor vehicle dealer is dealing in used cars - Is its transaction a sale in the conventional sense attracting the sales tax, or a service--as an intermediary, agent, or broker--to the true owner attracting service tax? - Held that: - the sale and the registration of the sale are two distinct acts. The sale of a motor vehicle, movable property, takes place under Section 19 of the Sale of Goods of Act. But if the transferee intends to get statutory protection as the owner of the transferred vehicle, he alone must invoke Section 31 of the Act to have the vehicle transferred on to this name.
Movable property--chattel--stands on a different footing. Possessing it amounts to owning it: there is an element of exclusivity. But owning it does not amount to using it. Of a motor vehicle, the sale signifies its possession; the registration, its use. The Legislation has advisedly avoided registration to be a precondition for the sale of movable property. A person can buy and possess a motor vehicle without registration so long as he does not intend to use. If he intends to use it, the registration assumes significance. As we can see, the Motor Vehicles Act regulates the use of a motor vehicle, and the sale, predates the use. Not everyone who owns a motor vehicle uses it, possessing vintage or antique cars--wealth in itself--being a case in point - the sale of a motor vehicle is governed by the Sale of Good Act, and its use by the Motor Vehicles Act.
It is now well settled that strong suspicion, strange coincidences and grave doubts cannot take the place of legal proof - the Commissioner observes that the dealer takes from the used-vehicle owner a "sale letter/sale deed." Incorrect. What the dealer obtains are Forms Nos.29 & 39, signed in blank, though. And neither of them is a sale letter or sale deed, nor does the statute compel the dealer, to be the owner, to obtain one.
Appeal dismissed - decided against Revenue.
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2017 (7) TMI 726 - CESTAT MUMBAI
Penalty - CENVAT credit - fictitious invoices - doctrine of severability - Section 73 (1A) of the Act - Held that: - A perusal of sub-section (1A) of Section 73 shows that it is an option to a person to admit liability in full or in part and proviso to sub-section (2) relates to the liability admitted under Section (1A). Therefore, if the entire amount demanded under the notice is accepted under (1A), it becomes the liability under Section (1A) - the appellants are entitled to the benefit of sub-section (1A) of Section 73 of the Finance Act, in respect of Cenvat Credit wrongly availed on fictitious invoices. Since the appellants have paid the entire amount of Cenvat Credit along with interest and 25% of penalty within one month of the issue of show-cause notice, all proceedings shall be deemed to be concluded in respect of that amount in terms of the proviso to sub section (2) of section 73. On the above ground, the benefit of section 73(1A) read with subsection 73(2) is allowed in so far as it relates to the first issue - appeal allowed.
CENVAT credit - duty paying invoices - credit denied as the documents contained alterations - Held that: - it transpires that C.P. Systems Pvt. Ltd. had provided services to the appellants and said invoices were indeed issued by C.P. Systems Pvt. Ltd. Difference in format was because of different places where the copies were generated. In these circumstances the fact of genuineness of the transaction cannot be questioned. The fact that the appellant received services and service tax was paid by the service provider for those service is not in dispute. It is seen that during this exercises duplicate copies of the documents have been obtained and transaction has been verified. Provision of service payment of service tax have already been confirmed and duplicate copies of invoices obtained from the service provider, the credit of such invoices in respect of services undisputedly received by the appellant cannot be denied - appeal allowed.
Classification of services - works contract service or erection, commissioning and installation services? - Held that: - It is apparent that the responsibility of providing of materials except raw materials is that of the appellants. In these circumstances, the character of the contract being a work contract cannot be denied. Consequently, the appellants should be entitled to the benefit of Notification No.25/2007 - it is apparent that the appellants are engaged in the activity in the provision of works contract service and would be entitled to benefit of notification No.25/2007. In these circumstances, the demand and penalties on this count cannot be sustained - appeal allowed.
CENVAT credit - denial on the ground that the goods have been received and consumed in their Jaigad site where the benefit of composition under works contract scheme has not been filed - Held that: - It is apparent that in principal the impugned order agrees that if the goods were indeed supplied to the appellants plant at JSW Jaigad site, the credit would be available. It appears that the documents presented before us were not presented before the original adjudicating authority. Since it is an issue regarding verification of facts, the demand is set aside and the matter remanded to the original adjudicating authority for verifying the facts with reference to all the documents and records that may be submitted by the appellants in this regard. If it is established from records that the goods were received at JSW Jaigad site the credit should not be denied - matter on remand.
Amount received as advance - demand - The appellant have however claimed the benefit of section 73(1A) read with subsection 73(2) as they had paid the amount of service tax demanded along with interest and 25% of the penalty within the prescribed period - Held that: - the benefit of section 73(1A) read with subsection 73(2) cannot be denied to them as they have deposited the amount of duty demanded along with the interest and 25% penalty within the prescribed time - appeal allowed.
Penalty u/s 77 (2) of the Finance Act, 1994 - Held that: - there is no provision for imposition of personal penalty on the director under the Finance Act. The said decision has been distinguished on the ground that in the said case the penalty under subsection 77(c) was examined and not under subsection 77(2). For any person to contravene any provision of the Finance Act or the Rules made thereunder it has to be first established that there was any liability of the person under the act - It is seen that there is no separate liability/responsibility of the Director of the service provider under the act or the rules. All the liabilities/ responsibilities are of the service provider. In these circumstances, penalty under Section 77 (2) cannot be imposed on the Director, the second appellant - appeal allowed.
Appeal allowed - decided in favor of appellant.
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2017 (7) TMI 725 - CESTAT CHENNAI
GTA service - reverse charge mechanism - Held that: - any person who avails GTA service including from individual truck operators when liable to pay service tax is eligible for the benefit of abatement as per N/N. 32/2004 - The appellant has also submitted a declaration that they have not availed the benefit of N/N. 12/2003. All these aspects have to be verified by the authorities below and for these reasons, the matter requires to be remanded
Penalty u/s 76 and 78 - Held that: - penalty u/s 76 as well as u/s 78 cannot be imposed simultaneously - In the present case, we do accept the contentions put forward by the counsel that during the relevant period, whether they were liable to pay on GTA service when services are rendered by individual truck owners was in confusion and there were decisions both in favour of the assessee and the department. Taking these facts into consideration, we find that the penalties imposed both under sections 76 and 78 is unwarranted - penalty set aside.
Appeal allowed in part and part matter on remand.
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2017 (7) TMI 724 - CESTAT MUMBAI
Renting of immovable property service - case of the department is that the appellant is liable to pay service tax on the rent of leased out premises of the factory under renting of immovable property service and the appellant is not entitled for the exemption N/N. 06/2005-ST dt. 1.3.2005 - Held that: - In the present case, the premises which was rented out the appellant is provider of service only to that premises. In that premises no capital goods was received and used on which the credit was taken. Therefore the condition (iii) of para 2 of the notification does not get violated.
The availment of cenvat credit in respect of input, input service or capital goods by the appellant only in relation to the manufacturing activity will not debar them from availing the exemption notification No. 06/2005-ST for their service of renting of immoveable property. The excisable activity in the manufacturing unit and the service related to renting of immoveable property are two distinct activities and therefore the availment of cenvat credit in relation to manufacturing activity cannot be applied to their service of renting of immoveable property.
The appellant is not liable to pay any service tax - appeal allowed - decided in favor of appellant.
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2017 (7) TMI 723 - CESTAT HYDERABAD
CENVAT credit - to discharges service tax liability under the category of Advertising Agency Services - structural steel used for fabrication of unipoles - case of the Revenue that the unipole which is fabricated is not goods and is an immovable property, so CENVAT credit cannot be allowed - whether the appellant is eligible to avail CENVAT credit of Central Excise duty paid on structural steel used for fabrication of unipoles? - Held that: - reliance placed in the case of Uni Ads Ltd Vs CCE, Cus & ST Hyderabad [2015 (11) TMI 1349 - CESTAT BANGALORE], where it was held that assessee is not eligible to avail CENVAT credit on the structural steel used for fabrication and erection of unipoles for display of hoardings and advertisements - the appellant is not eligible to avail the CENVAT credit of Central Excise duty on structural steel used for fabrication and erection of unipoles.
Extended period not invocable - demand upheld for the limitation period of one year from the date of issue of show-cause notice along with interest, the demand beyond the period of limitation is liable to be set aside.
Penalty - Held that: - Since the issue involved in this case was in litigation, the question of visiting the appellant with penalty does not arise. Accordingly, the penalty is set aside.
Appeal allowed - decided partly in favor of appellant.
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2017 (7) TMI 722 - CESTAT HYDERABAD
SEZ unit - Refund claim - case of appellant is that being SEZ Unit, they are not required to pay any service tax to the service providers - scope of SCN - Held that: - the lower authorities have gone beyond the allegations made in the show-cause notice and decided the matter on a different ground which was not put across to the appellant. It is settled law that adjudication proceedings cannot go beyond the allegations made in the show-cause notice and in this case despite there was second round of litigation both the lower authorities traversed beyond the allegations made in the show-cause notice - appeal allowed - decided in favor of appellant.
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2017 (7) TMI 721 - CESTAT ALLAHABAD
Short payment of tax - Man Power Recruitment or Supply Agency Services - tax with interest paid by appellant on being pointed out - Held that: - the SCN is bad to the extent of demand of ₹ 8,25,046/-, which was admittedly paid before the issue of SCN. Accordingly, the SCN, to this extent is not sustainable and accordingly, no penalty is also imposable on this amount, under any of the sections.
So far, the balance demand of ₹ 1,25,055/-is set aside and the matter is remanded to the Adjudicating Authority, for redetermination, in accordance with law, after providing opportunity to the appellant of being heard and leading evidence.
Appeal allowed in part and part matter on remand.
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2017 (7) TMI 720 - CESTAT CHENNAI
CENVAT credit - input services - Insurance Services for workers at site - Held that: - The exclusion clearly mentions various services including the Life Insurance and Health Insurance Services as not covered by Input Services. Similarly, the travel benefits extended to the employees at the time of Leave or Home Travel Concession also stands excluded. There is no warrant to read excluded Health Insurance Services with the travel benefits for leave etc - the fact that the appellant is obliged to provide such services under the Employees State Insurance Act, 1948 can also not to be held as ground to allow the credit, in as much as legislation is within its right to amend the definition of "Input Services" and to include or exclude any of the services from its ambit. In any case, the Tribunal is not within its jurisdiction to decide on the vires of the said amendments - demand upheld.
Penalty - Held that: - the appellants have availed the credit while reflecting the same in their account books as also in the various returns filed with the Revenue. Further, the issue involved is also a bonafide legal issue of interpretation of the provisions of law and cannot be held to be a malafide. In such a scenario, the imposition of penalty upon assessee is not warranted.
Appeal dismissed - decided against assessee only except with regard to penalty, which is set aside.
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2017 (7) TMI 719 - CESTAT CHENNAI
Valuation - Benefit of N/N. 12/2003 dated 20.06.2003 - The appellant had availed the benefit of the notification on bonafide belief that the cost of papers and chemicals consumed can be deducted from the taxable value of services - whether the appellant is eligible to deduct the cost of papers and chemicals consumed while providing the output service of 'Photographic Service'? - Held that: - the issue is settled by the Larger Bench judgment in the case of Aggarwal Colour Advance Photo System [2011 (8) TMI 291 - CESTAT, NEW DELHI (LB)], where it was held that The cost of unexposed film etc., would stand excluded in terms of Explanation to section 67 if sold to the client. Also, the value of other goods and material, if sold separately would be excluded under exemption N/N. 12/2003 and the term 'sold' appearing thereunder has to be interpreted using the definition of 'sale' in the Central Excise Act, 1944 and not as per the meaning of deemed sale under Article 366(29A)(b) of the Constitution.
Time limitation - Held that: - except for a vague statement that the appellant has willfully evaded payment of service tax by availing the benefit of notification, there is no evidence to establish that the appellant has intentionally evaded payment of service tax - the show-cause notice issued is time-barred and, therefore, not sustainable.
Appeal allowed on the ground of limitation.
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2017 (7) TMI 689 - CESTAT NEW DELHI
Commercial coaching or training service - Fee received for coaching provided for Business English and Personality Development - fees received for offering courses of London School of Economics (University of London) resulting in issue of degree by the University of London - tax liability - demand - Held that: - the degree or diplomas are issued by the Universities or the main organisation to which the college or an institute or a centre is affiliated. Keeping this in the background, it can be seen that the degree or diploma being issued by University of London can be considered at par while interpreting the scope of commercial training or coaching centre.
Whether such a degree or diploma is recognized by law for the time being in force? - Held that: - The UGC, AICTE etc are recognizing bodies of a University or an Institution. The degree or diploma awarded by these institutions considered as recognized by law for time being in force. In this connection, we note the position has been clarified regarding the scope of the term qualification 'recognized by any law' vide Board circular dated 28.08.2012. It clarifies that 'recognized by any law' will include such course as are approved or recognized by any entity established under a central or a state law, including delegated legislation, for the purpose of granting recognition to any education course.
It is relevant to note here that the department has been taking consistently a view that when an educational institute is affiliated to a university/institution awarding a degree recognized by law, then the said institute is not a commercial training or coaching centre. Reference can be made to circular No.26/2003 28.08.2012 and 26.02.2010 of the Board. Admittedly, the appellants were providing course resulting in the award of B. Tech, BBA, MBA of Allahabad Agricultural Institute (deemed university). No demand for Service Tax has been made in respect of these courses. Even on this ground, the appellants can not be considered as commercial coaching or training centre. Apart from the fact that the appellants will fall outside the purview of commercial coaching or training centre, I find that the Business English Course and Personality Development course offered by the appellants will be covered by exemption notification No.9/2003 ST.
Demand set aside - appeal allowed - decided in favor of appellant.
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2017 (7) TMI 688 - CESTAT MUMBAI
Classification of service - Site Formation & Clearance, Excavation and Earthmoving and Demolition Service - the earth moving equipment was provided by the appellant to the recipient of services on monthly payment basis - whether the service fall under Site Formation & Clearance, Excavation and Earthmoving and Demolition Service or under Supply of Tangible Goods Service? - Held that: - On perusal of contract between the respondent and the recipient of services, we find that the respondent have merely provided the earth moving equipment to M/s. Purti Sakhar Karkhana Ltd. on hire basis at a fixed monthly charges. The respondent is not under obligation to carry out the activity of Site Formation Services in the premises of the service recipient. In this fact it is clear that at the most the service is of supply of tangible goods for use and not fall under the service of Site Formation - the activity involved in the present case is of hiring of equipment on a monthly fixed rental. Therefore the learned Commissioner (Appeals) has correctly and legally held that the service does not fall under Site Formation Services - appeal dismissed - decided against Revenue.
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