TMI Blog2010 (9) TMI 313X X X X Extracts X X X X X X X X Extracts X X X X ..... . This appeal was taken up for disposal and was disposed of by this Bench vide Final Order No. 41/2007 dated 28-12-2006 by rejecting the appeal filed by the Revenue as devoid of merits. Aggrieved by such an order, Revenue preferred a Central Excise Appeal bearing No. 95/2007 before the Hon ble High Court of Karnataka. The Hon ble High Court, on 9th June, 2010, vide its judgment, had set aside the final order of the Tribunal and remanded the matter back with the following directions. 3. This appeal having admitted on5-12-2007for consideration, the matter was heard at length. Though elaborate arguments were addressed by both sides, it is seen from the perusal of the order dated 28-12-2006 passed by CESTAT that Tribunal has not proceeded to consider the appeal on merits namely as to the taxability of the respondent as Consulting Engineer or otherwise at relevant point of time though urged by Revenue. The copy of appeal memorandum filed before the Tribunal was made available by the learned counsel for the revenue before this Court during the course of his submission and having perused the same it is seen that a specific ground has been raised with regard to the taxability in so fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ces. The Adjudicating Authority rejected the refund claim holding that the training imparted by the respondent was correctly classifiable under Consulting Engineer services. Aggrieved by such an order, the respondents filed an appeal before the first Appellate Authority. The first Appellate Authority has accepted the contentions raised by the assessee and allowed the appeal and set aside the impugned order before him. Aggrieved by such an order, the Revenue is before us. 4. The learned Departmental Representative would reiterate the Grounds of Appeal, which are reproduced herein under :- (1) The Appellate Authority has attempted to form an opinion that the appellant s company is not falling under the category of an engineering firm, so as to fit in the definition of consulting engineers under section 65(39) of the Finance Act, 1994. This opinion is found attempted by the appellate authority without any recourse to the position of law. In order to form this opinion he has reasoned that an engineering firm generally would mean a firm which is engaged in the activity of execution of engineering projects. It cannot be stated by any stretch of imagination that the appellant s c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ence the activity will be chargeable to service tax even prior to1-7-2003and hence the O-I-A passed by the Commissioner (Appeals II) is not correct. 4.1 The learned DR would also submit that the decision of the Tribunal in the case of Transformers Electricals Kerala Ltd. v. CCE,Cochin- 2008 (9) S.T.R. 285 (Tri.-Bang.) would be applicable in this case. He would also rely upon the decision of the Hon ble High Court of Karnataka in the case of Tata Consultancy Services v. UOI - 2006 (2) S.T.R. 386 (Kar.) = 2001 (130) E.L.T. 726 (Kar.) for the proposition that the language of a statute in its ordinary meaning should be considered for application of taxable liability. He would also submit that the respondent had been providing Certificate of Training to the people. He would submit that the Board s Circular dated2-7-1997and more specifically para 3.3 of the said Board s Circular clarified the scope of services of Consultant which also included Manpower Planning and Training among others. It is his submission that the Order-in-Appeal be set aside and the Order-in-Original be restored. 5. The learned Counsel, on the other hand, would submit that the impugned order is correct and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orded the following findings :- ..........At the outset, let us see whether the appellants fall under the category of Consulting Engineer at all. The Consulting Engineering services has to be rendered by a certified engineer or an engineering firm and in the instant case it has to be looked into as to whether the appellants can be categorized as an engineering firm/company. The appellants are manufacturers of Distributed Control System machines. In fact, an engineering firm generally would mean a firm which is engaged in the activity with the help and assistance of the qualified assistants and their activities would include execution of engineering projects such as chemical plants, ports, dams and bridges etc. The advice, consultancy or technical assistance is rendered by such engineering firms on such projects starting from the initial stage to the final stage. At times, it may be an advice, consultancy or technical assistance for a particular situation/problem. In the process, such firms/companies may manufacture certain items connected with the projects they are specializing in. If this yardstick is applied, I am of the opinion that the appellants do not fall under the cate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... machines for better prospects. Moreover, in the certificate, it is mentioned as Course and such a course cannot be termed as an advice/consultancy or technical assistance, sought by the individuals from the appellants. Another feature of the definition consulting engineer is that the consultancy should be in one or more disciplines of engineering. I doubt whether the training content can be called as falling under any one of the disciplines of engineering. In addition, the lower authority has referred to the Board s Circular No. 43/5/97-TRU, dated2-7-1997. This circular is regarding imposition of levy of Service Tax on Manpower Recruitment Agent and Consulting Engineer. The scope of the services of a Consulting Engineer has been enumerated and the situations are only illustrative and not exhaustive. At Sl. No. viii, manpower planning and training has been specified. It is pertinent to note that there is no elaboration/explanation of the term manpower planning and training. Only because there is a mention of training in the circular, it doesn t mean that training of any sort would attract the levy of service tax. Thus the term manpower planning and training has to be unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Commissioner (Appeals) that the learned Commissioner (Appeals) has correctly interpreted whether the training imparted by the assessee would fall under the category of technical assistance or otherwise as is enshrined in the definition of Consulting Engineer . In order to appreciate the fact, the definition of the Consulting Engineer as per Section 65(13) and 65(48) of the Finance Act, 1994 is reproduced herein below : Section 65(13) : Consulting Engineer means any professionally qualified engineer or an engineering firm who, either directly or indirectly, renders any advice, consultancy or technical assistance in any manner to a client in one or more disciplines of engineering. Section 65(48)(g) : taxable service means any service provided - to a client, by a consulting engineer in relation to advice, consultancy or technical assistance in any manner in one or more disciplines of engineering. 6.4 It can be seen from the above reproduced definition that the said entry seeks to tax Consulting Engineers who are directly or indirectly rendering services of advice, consultancy or technical assistance. The Revenue s contention in this case is that by training the emp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all within the category of Consulting Engineer, as the appellants are providing training and coaching services and sharing the fees. They are not working in the advisory capacity or as a service provider. Therefore, the confirmation of service tax on the appellant is not justified in the facts and circumstances of the case. There is no merit in the impugned order and the same is set aside by allowing the appeal. 6.6 It is also seen that in the case of Karvy Consultants Ltd. v. CC CE, Hyderabad - 2008 (10) S.T.R. 166 (Tri.-Bang.), this Bench held as under :- 6. On a very careful consideration of the issue, we find that there is no dispute regarding the fact that the appellants are engaged in the services of share transfer agent and registrar official. They first brought into service tax net only w.e.f.1-5-2006. The Tribunal in the case of Ankit Consultancy [2007 (6) S.T.R. 101] cited by the learned Advocate elaborately dealt with this issue and has given a finding that prior to this period it would not come fall within the category of Business Auxiliary Services . Moreover, in the present case the show cause notice it time barred, as the longer period cannot be invoked. In vie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... effective from1st July, 2003. In terms of Circular No. 59/8/2003 dated20th June 2003[2003 (155) E.L.T. T7], issued from File No. B-3/7/2003-TRU, it was clarified that charges for erection of plant would not be covered under the Commissioning and Installation services. 2. In the light of above conflicting views, several representations have been received in the Board for clarification as to whether The charges for erection would be covered under Service Tax or not? The Commissioning or Installation service would be covered under Service Tax under Consulting Engineer service effective from7-7-1997? The issue has been examined by the Board in consultation with the Ministry of Law and Justice and in this regard I am directed to say that charges for erection, installation commissioning are not covered under the category of Consulting Engineer Services. Commissioning or Installation service will be separately taxable under relevant entry and are not chargeable under Consulting Engineer Services. Accordingly, the clarification issued vide the Circular No. 49/11/2002-S.T dated18-12-2002stands modified to this extent. 2. Suitable trade notice may be issu ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
