M/S. Roshan Tyres Service vs Commissioner Of Central Excise & ...

(Arising out of Order-in-Appeal No. AKP/105/NSK/2008 dated 19.11.2009 passed by the Commissioner of Central Excise (Appeals), Nashik )

For approval and signature:

Honble Mr. M.V. Ravindran, Member (Judicial) Honble Mr. P.S.Pruthi, Member (Technical)

============================================================

1. Whether Press Reporters may be allowed to see : the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2. Whether it should be released under Rule 27 of the : CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3. Whether Their Lordships wish to see the fair copy : of the Order?

4. Whether Order is to be circulated to the Departmental : authorities?

=============================================================

M/s. Roshan Tyres Service : Appellant

VS

Commissioner of Central Excise & Customs, Nashik : Respondent

Appearance

Shri Mayur Shroff, Advocate for Appellant

Shri B.Kumar Iyer, Superintendent (A.R) for respondent

CORAM:

Mr. M.V. Ravindran, Member (Judicial) Mr. P.S.Pruthi, Member (Technical)

Date of hearing : 23/4/2015 Date of decision : 23/4/2015

ORDER NO.

Per : M.V. Ravindran

This appeal is directed against the Order-in-Appeal No. AKP/105/NSK/2008 dated 19.11.2009.

2. Heard both sides and perused the records.

3. Short issue involved in this case is regarding the correct valuation of the services provided by the appellant. Appellant is re-treading tyres and is covered under the category of repairs and maintenance services. Appellant discharges service tax liability on the 40% of the amount charged under a impression that he is eligible for exemption of notification No. 12/2003-ST. Revenue authority did not accept this contention and demanded the service tax liability on the entire amount which is billed by the appellant to his client on the ground that the exemption Notification No. 12/2003-S.T. can be availed only when documentary evidence specifically indicating the value of the goods and material are shown on the invoice.

4. The period involved in this case is 16.6.2005 to 31.3.2007. Both sides on the direction of the Bench, fairly submit that the issue is now covered in favour of the Revenue by the judgment and order of the Tribunal in the case of Commissioner of Customs and Central Excise, Aurangabad Vs. New Hindustan Rubber Works 2015 (37) S.T.R. 120 (Tri.-Mum).

5. We find that the Bench in Paragraph No. 8 had held as under:

We find that as per the provisions of the Notification, there is a specific condition that there should be documentary proof specifically showing the value of material sold. In the present case, the respondents were clearing the goods under the consolidated invoice and uniformly charging taking 60% towards the value of the material and 40% towards service. There is no separate invoice regarding the actual sale of goods and material. We find that this issue is now settled by the Tribunal in the case of Ador Fontech ltd. (supra) and the Tribunal held that in the case of retreading of tyres where the invoices are showing deemed sale of certain percentage of material the benefit of Notification No.12/2003 is not available. The Tribunal further held that the material used for repairs of tyres cannot be considered as spare. In view of the above decision, we find merit in the contention of Revenue and the impugned order whereby the Commissioner (Appeal) allowed the benefit of Notification No. 12/2003-S.T., is set aside and the order passed by the adjudicating authority in this regard is restored.

In the case in hand, the above ratio will apply as on perusal of the records, we do find and appellant has not produced any evidence to show that 60% of the martial cost needs to be abated as per his claim. Accordingly, we hold that the demand of the service tax liability along with interest is correctly fastened on the appellant and no interference is called for in such an order.

6. At the same time, we do agree with the issue involved in this case is of an interpretation and had to be settled by the Tribunal, accordingly, penalties imposed on the appellants are unwarranted; invoking the provisions of Section 80 of the Finance Act, 1994, we set aside the penalties imposed under Section 76 & 78 of the Finance Act, 1994.

7. At this juncture, Ld. AR submits that the appellant has not fully discharged the service tax liability with interest. Learned Counsel undertakes to discharge the entire service tax liability and the interest thereof within 30 days from today and inform the lower authorities accordingly. The penalties which are set aside by the bench is subject to the condition that the appellant discharges the balance liability along with interest as indicated hereinabove.

8. Appeal is disposed of as indicated hereinabove.

(Pronounced & Dictated in court)

(P.S.Pruthi) Member (Technical)

(M.V. Ravindran) Member (Judicial)

Sm

??

??

??

??

5