TMI Blog2006 (10) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... authorities below in his Order-in-Original dated 29-11-04 holding that the appellant corporation floated by Punjab Government for the welfare of Ex-serviceman is not a charitable organization but. Service provider of security services which are taxable under the law. 2 . Aggrieved by the orders of authorities below, this appeal has come before us. None represented the appellant inspite of notice. On examining the grounds of appeal, the appellant has heavily relied upon the fact that the Government of Punjab under the Punjab Act No. 33 of 1978 has set up the appellant corporation for rehabilitation of ex-serviceman. In the appeal memorandum, the appellant has contended that they are not the commercial organization and hence, they were n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of this Chapter, the value of taxable services in relation to the service provided by a security agency to a client, shall be the gross amount charged by such agency from the client for services rendered in connection with the security of any property or person, and includes services of investigation, detection or verification of any fact or activity including services of providing security personnel. 4 . We have heard the learned authorised representative for the department and perused the record. From the record, it is clear that the appellant corporation, though created under the Punjab Ex-Serviceman Act, 1978, has rendered the services of security agency, which is carried out on commercial terms as evident from their own agreemen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l nature or otherwise including the services of providing security personnel. The ambit of the term security agency is wide enough to include not only agencies rendering services of providing security but also detective agencies which are providing confidential services in respect of say, financial credibility of any person, trade mark/copyright infringements, etc. Most of the security agencies are only registered under the Shops and Establishments Act. These agencies may not be required to take a license under any other statutes. 10.2 An issue that has been raised is whether service tax is leviable on the entire amount charged to the clients to whom security guards/personnel have been provided as the bulk of the charges represent salar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... paid by the recipient of service and the cost of labour is an integral part of the value of service provide . The ratio adopted by the Hon 'ble Madras High Court in its judgment GDA security Pvt. Ltd. v. Union of India reported in 2006 (2) S.T.R. 542 {Mad} = 2002 (140) E.L.T. 332 (Mad.) may also be relevant here. Para 10 of the said judgment reads as under:- 10. similarly, we are also not impressed by the contention raised that in case of some other agencies while being taxed under the service tax, the expenditure incurred while offering the services are excluded and in case of secu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dity of the provisions much less under Art. 14 of the Constitution of India. All the challenges related to the calculations and mote particularly in comparison to the other services would have to be rejected on this ground alone. 7. We also rely upon the agreement entered into by the appellant with their client relating to the security services provided to them, more particularly, the clauses reproduced below, which indicate the role and functions of the appellant in a lucid manner: Whereas RSD is desirous of entrusting the security relating to pilferage of project material and other undesirable activities i.e. absenteeism, un punctuality, non-wearing of badges/identity discs and other indiscipline among the workers. And wherea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ull incidence of such duty to the buyer of such goods. Thus, the provider of service only assessee according to section 65 of Finance Act is to collect service tax from the users of service as contemplated under Sections 12A and 12B of Central Excise Act, 1944. The second Respondent rightly mentioned in all bills the details including service tax which is payable by the users. 9 . A perusal of Section 15 of the Punjab Ex-serviceman Act, 1978, clearly spells out the commercial nature of business that the corporation could engage in. 10 . As regards the question of valuation, it is abundantly clear from the definition as forthcoming from the Act that the gross amount charged by the appellant from their clients becomes taxable value. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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