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Hindustan Aeronautics Ltd Versus Commissioner of Service Tax Bangalore Service Tax-I

2017 (8) TMI 435 - CESTAT BANGALORE

Maintenance or Repair Services - maintenance and repair services mainly in respect of Defence customers like Air force, Navy, Army and Coastguard, in addition to civil customers like M/s. ONGC - Held that: - the issue involved in the present case is no more res integra and has been settled in favor of the appellant by the Hon'ble Supreme Court in the case of Larsen and Toubro Ltd. [2015 (8) TMI 749 - SUPREME COURT], wherein the Hon'ble Supreme Court has categorically held that before 1.6.2007 th .....

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. G. Shivadass, Advocate, For the Appellant Mr. N. Jagadish, AR, For the Respondent ORDER Per: S.S Garg The present appeal is directed against the impugned order dated 30.12.2005 passed by the Commissioner whereby the Commissioner has confirmed the demand along with interest but waived the penalty under Section 76 and 78 in exercise of the power conferred under Section 80 of the Finance Act, 1994. 2. Briefly the facts of the present case are that appellant M/s. Hindustan Aeronautics Ltd., Helico .....

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ance and repair services mainly in respect of Defence customers like Air force, Navy, Army and Coastguard, in addition to civil customers like M/s. ONGC. However, they did not discharge Service Tax liability thereon, though they received the amount towards maintenance and repair services from their customers. A statement was recorded from the Chief Manager (Finance), Shri C.B. Ananthakrishnan, wherein he stated inter alia that M/s. H.A.L. undertake repair /overhaul of helicopters in respect of c .....

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carrying out the repairs and maintenance work on the goods which are manufactured by them for the Defence as well as civil customers. The above activity undertaken by the assessee, is covered within the ambit of Service Tax, under the category of "Maintenance or Repair Services", effective from 1.7.03. As per the statutory definition, "Maintenance or Repair Service", means "any service provided by any person under a maintenance contract or agreement, or a manufacturer or .....

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nd perused the records. 4. Learned counsel for the appellant submitted that the impugned order is not sustainable in law as the said decision is contrary to the binding judicial precedents decided by the High Court and the Supreme Court. He further submitted that the activity involved in the present case relates to transfer of property in goods along with provision of maintenance or repair service. Maintenance or repair service of such nature has been recognized as works contract by the Hon' .....

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alone. Learned counsel relied upon the decision of the Hon'ble Supreme Court in the case of Commissioner of Central Excise, Kerala Vs. Larsen and Toubro Ltd 2015 (39) STR 913 (SC) wherein the Hon'ble Supreme Court has categorically held that before 1.6.2007 there was no charging section to specifically levy service tax on works contract service or mechanism to tax service element derived from gross amount charged for works contract less value of property in goods transferred in execution .....

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prayed that the service tax paid by the appellant is liable to be refunded. He also submitted that where the invoices clearly distinguish between the cost of the material and the labour charges, then service tax should only be levied on the labour charges and not on the cost of material and in support of this submission, he relied upon the following two decisions: Wipreo GE Medical Systems India Pvt Ltd Vs. CST, Bangalore: 2009 (14) STR 43 (Tri. -Bang.) Agarwal Colour Advance Photo System Vs. C .....

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