TMI Blog2022 (3) TMI 229X X X X Extracts X X X X X X X X Extracts X X X X ..... ire arrangements for pumping water when there was power failure - The appellant has already discharged service tax under the head Management, Maintenance and Repair Services. As far as the cost of diesel, mobile oil, etc. is concerned, these were required for the maintenance, incurred by the appellant and reimbursed by the Delhi Jal Board. Therefore, these reimbursements cannot be called consideration for rendering service. Therefore, the entire demand made in the show cause notice and confirmed in the impugned order towards supply of tangible goods service needs to be set aside. Electric motor winding job - HELD THAT:- Undisputedly this service required both winding of the motors and also using the materials required for such service. Thus, it was a composite works contract which involved both rendering service and supplying material. The Revenue also does not dispute that it is a composite contract. However, there is a break up in the contract and 20% of the total amount received is attributed by the Delhi Jal Board towards services and 80% towards material. The appellant has paid service tax on 20% and VAT on the 80% of the amount - the demand of service tax on the 80% of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is only in respect of Water Supply System of Delhi Jal Board. The benefit of Notification No. 25/2012-ST dated 20.06.2012 is admissible to the party post 01.07.2012 period . 4. The present dispute is for the period 2009-2010 to 2012-2013 during which period the appellant carried out the following two activities under various work orders received from the Delhi Jal Board. 5. The first activity is called supplementary arrangements for pumping during power failure by hiring Diesel Genset for operation of booster pumping station . The work orders issued for this purpose by Delhi Jal Board included loading and unloading for the diesel generator set, checking of the batteries as well as changing the switch from main line to the diesel Genset and switching it back to the normal circuit after restoration of electric supply as well as maintenance of the system. The appellant considered this as a service of management and maintenance and discharged service tax accordingly. The case of the Revenue is that the service in question is one of supply of tangible goods without transferring effective control over them and hence is chargeable to service tax under the head supply of tangi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his service, such as, diesel, lubricating oil etc. is concerned, learned Chartered Accountant submits that the value of such materials cannot be included in the gross value of services. He relies on the following case laws :- (i) Safety Retreading Co. (P) Ltd. versus Commissioner of C. Ex., Salem 2017 (48) S.T.R. 97 (S.C.) ; (ii) CCE vs. JP Transformers, 2014 - (36) S.T.R. 961 (All.) ; and (iii) CCE, Agra vs. Goverdhan Transformers Udhyog Pvt. Ltd. 2015 (37) S.T.R. 161 (All.) 9. The second type of contracts is for electric motor winding job against work contracts received from Delhi Jal Board. Learned Chartered Accountant for the appellant submits that the Delhi Jal Board offers contracts to the contractors (including the appellant herein) to take up the winding up to electric motors. The contracts include not only winding of motors but also use of materials required for such winding. As per the work orders issued by Delhi Jal Board, of the total contract value 80% will be paid towards the value of the goods used and 20% towards value of services rendered. The appellant has paid service tax under the head Management, maintenance and repair services on 20% of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ods services is concerned, we find from the work orders enclosed in the appeal paper book that the contract was not given by the Delhi Jal Board to the appellant to supply diesel Gensets although they were an important component of the contract. Supply of Diesel Genset was not the essence of contract. The essence of contract was making supplementary arrangements for pumping water during power failure . This arrangement required the appellant to supply Diesel Gensets, load them, unload them, check their batteries, operate them, connect them to the pump sets, when there is power failure and switch over the pumps back to the main line once the power is restored. Thus, the appellant was required to make the entire arrangements for pumping water when there was power failure. It would have been a different case if the contract was only for supplying Diesel Gensets without transferring effective control and possession. In such a contract, the appellant could not have had the responsibility of connecting and disconnecting the Diesel Gensets as and when the power goes or is restored respectively. In our considered view, this cannot be called supply of tangible goods but is a contract for ..... X X X X Extracts X X X X X X X X Extracts X X X X
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