Co. P. Ltd vs C.C.E., Jaipur-Ii

1. Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2. Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? Yes 3. Whether Lordships wish to see the fair copy of the order? Seen 4. Whether order is to be circulated to the Department Authorities? Yes

Appeal No.ST/711/2009-CU[DB]

[Arising out of Order-in-Appeal No.60 (DK)ST/JPR-II/2009 dated 24.06.2009 passed by the C.C.E.(Appeals), Jaipur-II]

M/s. Udaipur Tyre Retreading

Co. P. Ltd. Appellant

Vs.

C.C.E., Jaipur-II Respondent

Appearance

Mr. Bipin Garg, Advocate - for the appellant

Mr. Ranjan Khanna, DR - for the respondent

CORAM: Honble Justice G. Raghuram, President

Honble Mr. R.K. Singh, Member (Technical)

Final Order No.53822/2015, dated 11.09.2015

Per Mr. R.K. Singh :

Appeal has been filed against Order-in-Appeal dated 24.06.2009, which upheld Order-in-Original dated 14.11.2008, in terms of which service tax demand of Rs.1,03,575/- was confirmed along with interest and penalties for the period 16.06.2005 to 31.01.2007 on the ground that the appellant provided the service of re-treading of tyres, which was covered under Maintenance and Repair Service, but it did not pay any service tax thereon and indulged inter alia, in wilful mis-statement and suppression of facts to evade service tax.

2. Ld. advocate for the appellant contended that the tyre forms part of the motor vehicles and maintenance and repair of vehicle is excluded from the purview of maintenance and repair service and therefore, the impugned demand is not sustainable. However, he conceded that deduction of the cost of value of rubber has used for repair was duly extended by the Commissioner (Appeals). He also cited a few judgments to support his proposition that the extended period in this case is not invocable. Ld. counsel did not argue any other point.

3. We have considered the contentions of the appellant. It is seen that the appellant was engaged in the business of retreading of tyres. This activity in our considered view is not tantamount to maintenance and repair including re-conditioning or restoration or servicing of motor vehicles. In the case of PLA Tyre Works [2009-TIOL-304-CESTAT-MAD], CESTAT clearly held that the impugned service is covered under maintenance and repair service. Indeed, the contention of the appellant that it did not pay service tax because it considered itself as providing service of maintenance and repair of motor vehicles is a thought which no reasonable person operating in an appropriate environment would entertain. Bona fide belief is not a hallucinatory belief but a belief of a reasonable person operating in an appropriate environment. Thus, there was no scope for a bona fide belief that the impugned service is tantamount to repair or maintenance of motor vehicle and therefore the extended period is rightly invoked and penalty under Section 78 ibid is attracted.

4. In the light of the foregoing analysis, we do not find any merit in this case and therefore the appeal is dismissed.

(Justice G. Raghuram)

President

(R.K. Singh)

Member (Technical)

SSK

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