TMI Blog2023 (9) TMI 721X X X X Extracts X X X X X X X X Extracts X X X X ..... the above work order does not indicate any activity of technical testing. It is in the nature of heat treatment, stress relief treatment, etc. For an activity to fall under technical testing, some process so as to test the quality, strength, toughness, etc., has to be done. From the literature available in website, it cannot be concluded that the activity under taken by the appellant falls within the definition of technical testing and analysis services‟. Further, in the present case, it is not seen that the appellant has issued any certificate with regard to the testing done. From the statement given by Shri C. Manikanteswaran, it is inferred that while doing the heat treatment, the temperature at which the material is subjected to heating is recorded. It is prepared in a chart form and given the customer. Thus, the temperature chart provided by the appellant is considered to be the test report by the Department - there are no material throwing light with regard to a certificate issued by the appellant as to the technical nature/ quality of a product - the issue therefore requires re-consideration. This is a fit case for remand to the adjudicating authority who is di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in addition to the service charges. Their main customers are contractors / industries entrusted with the work of fabrication, erection or repairing of fabricated items in the premises of the industries or power plants of major units which include M/s. BHEL, M/s. NLC, M/s. India Oil Corporation, M/s. CPCL and various other industries. From the invoices raised by the appellant, it was noted that they had collected service charges as 'labour charges' and they have not discharged Service Tax on the amount so collected. They have not filed ST-3 Returns also. A Show Cause Notice dated 19.04.2012 was issued to the appellant proposing to demand the Service Tax under 'Technical Testing and Analysis Services' for the period from 01.10.2006 to 01.09.2011 along with interest and for imposing penalties. After due process of law, the original authority confirmed the demand along with interest and imposed equal penalty. While confirming the demand, the original authority extended the benefit of cum-tax value observing that no separate tax was collected. Against the said order of confirmation of duty, the appellant filed appeal before the Commissioner (Appeals). The Department also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not do any testing as to the welded joints. The allegation of the Department that the appellant is doing testing of the welded joints, etc., is without any factual basis. 3.3. It is thus argued by the Ld. counsel that the activity of the appellant does not fall under the category of taxable service of Technical Testing And Analysis Services. 3.4 Without prejudice to the above argument, the Ld. counsel submitted that the valuation is also incorrect for the reason that some of the amounts are reimbursable expenses. The appellant has collected charges in the nature of cost of transport, etc., which are nothing but reimbursable expenses. The cost of materials and other charges paid by the customer is also included by the Department to arrive at taxable value which is erroneous. The period being prior to 2015, the reimbursable expenses have to be excluded. 3.5 Further, that the adjudicating authority had correctly allowed cum-tax benefit, since the appellant had not collected Service Tax. After obtaining Service Tax registration as per direction of the Department, the appellant had started paying Service Tax. Prior to that, the appellant has not collected any Service Tax. The C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Recorder 2. Panel Box 3. Heatin elements 4. Thermo Couple Cables and 5. Power Cable. The Temperature recorder indicates the temperature at which the testing is to be done on the welded joints. This temperature is fixed as per the requirement of the customer. The Panel box is for operating the system at the time of testing. The heating elements and cables contribute to the heating process. After the completion of the testing we furnish a testing report to the customers. The testing report is a chart taken from the temperature recorder after each testing. The said chart will normally indicate the temperature details under which the testing was carried out. This chart is the testing report given by us signed by our technical staff and also signed by the staff of the client/customers. I further state that such testing reports are normally to be maintained by the manufacturers/ fabricators of the products tested for welding joints. As per the practice such testing reports of the welded joints shall also be furnished by the manufacturers/ fabricators to their buyers. I further state that majority of our service is done at the site of the customers where fabrication or erection of item ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y and toughness. The degree to which these properties are affected depends on the chemical composition on the base material and cooling made after welding. PWHT treatment requirements are typically dictated by codes and standards and by any special requirements due to the service conditions of the welded structure. Post heating is primarily done to avoid Hydrogen Induced Cracking (HIC), also known as Cold Cracking and Hydrogen Assisted Cracking (HAC). 6.8 What we understand is that heat treating done on welded joints can improve wear resistance by hardening the material. Metal can be hardened either on the surface or all the way through to make the material stronger, tougher, more durable and more resistant to wear. From the literature available in website, we are not able to conclude that the activity under taken by the appellant falls within the definition of technical testing and analysis services‟. Further, in the present case, it is not seen that the appellant has issued any certificate with regard to the testing done. From the statement given by Shri C. Manikanteswaran, it is inferred that while doing the heat treatment, the temperature at which the material is subj ..... X X X X Extracts X X X X X X X X Extracts X X X X
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