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TMI Blog2009 (8) TMI 638X X X X Extracts X X X X X X X X Extracts X X X X ..... records. 3. The issue involved in this case is whether the activity of formation or improvement/re-asphalting of the existing roads for National Highway Authority, Public Works Department, KIADB (Karnataka Industrial Area Development Board), KUIDFC (Karnataka Urban Infrastructure Development Finance Corporation), KRDCL (Karnataka Road Development Corporation Ltd.,) etc. is liable for service tax under the category of Management Maintenance or Repair services under the Provisions of the Finance Act, 1994. 4. The undisputed facts are that the appellant herein bid for the contract of the maintenance/management/re-asphalting of the existing roads. The undisputed facts is also that the said reasphalting or improvement of the existing roads are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ver or impregnate with asphalt". The Law Lexicon as brought out by Shri P. Ramanatha Aiyer (Reprint 2004, Pg. 1165) states the following with regard to maintenance of a main road. 'Maintenance' means not only keeping in good repair but also keeping in efficient working Order or in an efficient state. O'neil v. Brown, (1961) 1 All ER 571, 573 (QBD). (Motor Vehicles Construction and use Regulations, 1955. Ref. 73(l)]. The word maintenance' covered repairs and included the overhauling and reconditioning, of the vehicles. London Transport Executive v. Betts, (1958) 2 All ER 636, 645 (HL). [Rating and Valuation (Apportionment) Act, 1928, Further in page 1166 maintenance, works of or alteration, of works has been stated as under: "It is very ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing. To repair means to restore to a sound or good state after decay, injury, dilapidation, or partial destruction. The word "maintain" does not mean to provide or construct, but means to keep up, to keep from change to preserve. To hold or keep in any particular state, or condition; to keep up. "The verb" to maintain' signifies to support what was already been brought into existence." Although the Law Lexicon does not specifically refer to improvements of roads, improvement of land, as mentioned at Page 893 is asunder: "Improvement (of land) Esecriche, in his Dictionary divides improvements on land into three classes-necessary, beneficial and voluntary. Necessary, are those made to prevent the loss or deterioration of the property, as re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eriod of time. It is a fact that a road comes into existence at the stage of completion of the first stage, and at each phase of completion of the work the road, become more even and smoother and vehicles playing on these can move with greater comfort. However, the phases are broken up over different periods of time or are done sequentially at one time, they bring into existence a road and merely because the level of comfort of the road is increased in subsequent phases done over separated period of time does not mean that a new road has come into existence at the end of the third phase only. Once an existing road surface is provided by the completion of the first phase and is separated by a period of time in providing the metal ling and pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... new road comes into existence. Hence both asphalting and re-asphalting are activities involved in the maintenance of roads and hence on this score also the specific classification of the service provided by the noticee is covered by the definition under Section 65(64) and the taxable service would be under Section 65(105)(zzg)of the Finance Act 1994. However, activities 'such as formation of roads etc., which are not in the nature of maintenance or repair merits exclusion from service tax liability. 31. As per noticee's contention to constitute maintenance or management, there must be a property whether immovable or not and that in their case they are building property and on completion of work the property is handed over to the concerned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecision of the Tribunal in the case Dr lal Path Lab. Pvt. Ltd. v. CCE, Ludhiana [2006 (4) S.T.R. 527] will cover the issue. He submits that all the contracts which are entered by the appellants for the improvement/reashpalting are works contracts as per the registration granted by Karnataka VAT Act. 5. Learned JCDR on the other hand would submit that the entire issue is squarely covered by the definition of the management, maintenances/repairs. She submits that the adjudicating authority has given a detailed finding to hold that these activities would fall under management, maintenance or repair services. It is her submission that prior to 1-6-2007, the service will be covered under the category of management, maintenances or repair ..... X X X X Extracts X X X X X X X X Extracts X X X X
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