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TMI Blog2018 (11) TMI 1528X X X X Extracts X X X X X X X X Extracts X X X X ..... he appeals are restored to its original number. 5. The present set of appeals are against the Order-in-Original No.20/S.Tax/Commr/2006 dated 28.11.06. Vide the impugned order, the adjudicating authority has demanded the payment of service tax from M/s. Praxair India Pvt. Ltd. (PIPL). He has also imposed penalties on PIPL under various sections of the Finance Act, 1994. In addition, personal penalties have been imposed on Shri Indrajit Mookherjee, the then Managing Director as well as Shri N. Ravichandar, the then Manager (Corporate) of the PIPL. 6. PIPL was engaged in the manufacture and supply of Industrial Gases such as Oxygen and Nitrogen. In addition to having air separation plants and pump filling stations across the country, the appellants also erected storage tank at the premises of their customers to facilitate storage of their products. The appellants also construct oxygen and nitrogen plants at the customers' premises and lease it out to the customers. They also undertake maintenance and repair of such plants. 7. The dispute in the present case revolves around the agreement dated 11.07.2001 entered by PIPL with M/s. Usha Martin Ltd. (UML). After scrutiny of the said ag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reference to the demand under the category of storage and warehousing service, he relied on the Bangalore Bench decision to the effect that the activity, in terms of the separate agreement with UML is not covered by the definition of storage and warehousing service. 10. Ld. DR justified the impugned order. 11. We have heard both sides at length and perused the appeal records. 12. We have considered carefully the decision of the coordinate Bench at Bangalore vide decision dated 03.10.2018. We note that the dispute revolves around the agreement dated 11.07.2001 entered into by PIPL with their customer UML. The very same agreement was considered by the Bangalore Bench with reference to the service tax demand made against PIPL. The Tribunal held that there is no liability for payment of service tax since the agreement for lease was executed prior to the date of introduction of the Banking or Financial Services i.e. 16.07.2001. Since the very same agreement for an earlier period is before us, we find no reason to take a different view. 13. The second dispute is with reference to the demand under Management, Maintenance or Repair service. In terms of the agreement entered into by PIP ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... missions to substantiate their argument that the contract was effectively before 16.7.2001. * Acknowledgment from Entrepreneurial Assistance Unit of Ministry Commerce and Industry dated 9.6.2000. * Chartered Engineer's Certificate dated 9.8.2000 for one oxygen compressor for oxygen plant for UML. * Letter dated 10.8.2000 from Praxair to Ministry of Industry, Department of Industrial Development requesting to grant permission from Bharuch to Jamshedpur for installing at UML. * Letter dated 11.8.2000 from Praxair to Ministry of Industry, Department of Industrial Development informing that a contract has been signed by UML to set up an oxygen plant at Jamshedpur. * Letter dated 20.9.2000 addressed to Praxair from the Ministry of Industry & Commerce, calling for additional information. * Letter dated 19.10.2000 addressed to Praxair from the Ministry of Industry & Commerce, calling for additional. * Letter dated 6.4.2001 from UML addressed to Praxair informing that the goods brought for setting up VPSA Plant are under detention by Central Excise Department and unless release ST/496/2008, ST/973/2009, ST/1874/2010, ST/1339/2011, ST/664/2011, ST/2959/2012 13 letter is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the agreement which are similar to the present agreement, set aside the demand. The Tribunal held as under: - ST/496/2008, ST/973/2009, ST/1874/2010, ST/1339/2011, ST/664/2011, ST/2959/2012 15 4. Since the Finance Act, 1994 does not define what is financial leasing, the Commissioner (Appeals) has relied upon the Accounting Standard published by ICAI. According to the accounting standards, the leasing is classified as a financial leasing if the ownership of the assets on lease is transferred to lessee by the end of the lease term and this opinion is created at the inception of the lease itself. In the instant case, the agreement is only for the period of 35 months during which a monthly user charge is required to be paid and agreement does not provide for transfer of the assets at the end of the term. Further from the agreement it is also seen that all risks and rewards incidental to the ownership have also not been transferred and ownership of the asset and effective control of the assets remain with the applicant in this case. Further, lease is for a short period of 35 months extendable to another period of 2 years and has no relation to the economic life of the asset which is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A based oxygen plant between M/s. Usha Beltron Ltd. (M/s. UML) and the appellants, we find at para 1.7 that subject to other provisions of this agreement, title to all oxygen plant equipment will remain vested in Praxair. Praxair shall remain at all times the sole and absolute owner thereof and no right, ownership, title or interest therein (save and accept for the lease hold rights aforesaid) shall pass to USAD. Praxair shall be entitled to put its name plates or markings on any part of the oxygen plant or oxygen plant equipment indicating Praxair's title and interest therein. USAD shall at no time contest or challenge Praxair's sole and exclusive ownership of the oxygen plant equipment or any part thereof. 5.1.5 Going by the above and the differentiation brought in by the decisions of various judgments of the Tribunal, we are inclined to hold that the appellant's case is that of a equipment lease rather than financial lease. We find that the Tribunal has decided the case in favour of the appellants. Therefore, we find that the demands raised against the appellants for leasing the oxygen plant equipment are not sustainable in law. ST/496/2008, ST/973/2009, ST/1874/2010, ST/1339/ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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