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TMI Blog2015 (6) TMI 917X X X X Extracts X X X X X X X X Extracts X X X X ..... error of law in disregarding the factors relevant for disposal of a waiver-cum-stay application?" 2. The brief facts of the case are as follows: The appellant is a contractor and has been awarded a contract by M/s.IRCTC for supply of food and refreshments to the passengers on board the trains run by the Indian Railways. The catering services rendered by the appellant became liable to service tax levy under Section 66 of the Finance Act, 1994, with effect from 1.3.2006. It is seen that during the period 10.9.2004 to 28.02.2006, the said service when provided on railway trains remained exempted from the levy of service tax vide notification No.19/2004-ST dated 10.9.2004. However, the said notification was rescinded vide Notification No.2/2006-ST dated 01.03.2006 to make the outdoor catering service provided on trains liable to pay service tax payment from 1.3.2006 onwards. 3. It is seen that Writ Petitions have been filed before this Court challenging the vires of Sections 65(24), 65(76a) and 65(105)(zzt) of the Finance Act, 1994. This Court, by order dated 25.7.2001, upheld the vires of the above provisions, which was reported in 2001 (133) ELT 265 (Mad) (Tamil Nadu Hotels Associ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vice provided in factory canteens where the outdoor caterer are engaged to provide the catering services at a place other than his own and he apart from supplying food, snacks and beverages to the staff and workers at the prices fixed by the factory management which are to be borne by the factory either fully or partially, also supplies food articles to the factory staff and workers and charges them directly. 15.3 Importantly, in the period from 10.09.2004 to 28.02.2006, out-door catering service provided on railway trains was exempted from the levy of service tax vide Notification No.19/2004-ST, dated 10.09.2004 and after withdrawal of this exemption vide Notification No.2/2006-ST dated 01.03.2006, Out Door Catering Service provided on trains became liable to service tax payment from 1.3.2006 onwards. Thus, it cannot be disputed that service tax is leviable on activities that are meeting out the definition of outdoor catering service as defined under Section 65(105)9zzt) of Finance Act, 1994 and from thereon they are required to pay service tax on this service in the manner provided under Section 68 of the Finance Act, 1994. " 7. The Adjudicating Authority also relied upon the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in railway trains along with food shall not bring the transaction to tax net under Finance Act, 1944. He relies on the decision of the Hon'ble Delhi High Court in the case of Indian Railways C & T Corpn. Ltd., vs. Government of India and others - 2010 (20) STR 437 (Del.) Ld. Commissioner examined the ratio of that judgment and found that the judgment rendered in the context of Delhi Sales Tax has decided the leviability of the sales tax. But leviability of the service tax on the service aspect was not the subject matter of dispute in that case before the Hon'ble High Court. Considering the ratio laid down by the apex Court in Imagic Creative Pvt. Ltd., vs. Commissioner of Commercial Taxes - 2008 (9) STR 337 (SC), appellant is directed to pre deposit the following amounts in the stay applications noted against each within 8 weeks from today and make compliance on 07.04.2015. S.No. Stay Petition No. Amount 1. ST/S/41785/2014 Rs.1,50,00,000/- 2. ST/S/41786/2014 Rs.75,00,000/- 3. ST/S/41787/2014 Rs.75,00,000/- 4. ST/S/41788/2014 Rs.75,00,000/- Upon compliance, there shall be waiver of pre-deposit of balance demand in question and stay of recovery thereof ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vered by maximum retail price concept should be considered, there is a substantial reduction in demand. This plea, however, has been taken before the Tribunal, but not before the Adjudicating Authority. Therefore, we leave the issue open to the assessee to contest the same on its own merits before the Tribunal. 15. The other plea taken by the counsel for the appellant is financial hardship. Learned counsel for the appellant submitted that the appellant is required more than Rs.one crore to provide the services and therefore, the demand in this case would cripple the 30 year contract, which itself is sufficient to safeguard the interest of the Revenue. 16. The facts in the case of IRCTC v. Govt. of NCT of Delhi & Ors. reported in 2010 [20] STR 437 (Delhi), were the Government company providing services including catering on board the trains run by Indian Railways on a contract between the petitioner company and the Indian Railways. The Government company sub-leased the contract in respect of some trains to various contractors. The consideration of such services is included in the fare charged by the Indian Railways from the passengers and the Government company was paid by Indian ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsaction between the petitioner-company and Indian Railways for providing food and beverages to the passengers, on board the trains, is a transaction of sale of goods by the petitioner-company to Indian Railways. It is neither a contract for providing services nor a composite contract for supply of goods and providing of services. We also hold that sale in respect of goods loaded on board the trains in Delhi, takes place, when the goods are loaded in the trains. Accordingly, we find no merit in the writ petitions and the same are hereby dismissed. It will, however, be open to the petitioner to claim refund of service tax already paid by it in respect of such transactions. If the refund is declined, the petitioner will be at liberty to initiate such proceedings, as may be open to it in law in this regard. If service tax is sought to be levied, upon the petitioner, in future, in respect of such transactions, it will be open to it, to challenge the same in appropriate proceedings." 18. The Kerala High Court in the case of SAJ Flight Services Pvt. Ltd. V. Superintendent of Central Excise reported in 2006 (04) STR 429 (HC-Ker.), however, took a contra view in that matter. 19. In view ..... X X X X Extracts X X X X X X X X Extracts X X X X
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