M/S Vikas Construction Company vs Cce &St, Bhopal

1 Whether Press Reporter may be allowed to see the Order for publication as per Rule 26 of the CESTAT (Procedure) Rules, 1982?

2 Whether it should be released under Rule 26 of 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?

Service Tax Appeal No. 1178 of 2010

(Arising out of order in appeal No. 603/BPL/2009 dated 12.10.2009 passed by Commissioner (Appeals), Customs, Central Excise & Service Tax, Bhopal).

M/s Vikas Construction Company Appellant

Vs.

CCE &ST, Bhopal Respondent

Appearance:

None for the Revenue

Shri B. B. Sharma, DR for the Respondent

Coram: Honble Mr. Justice G. Raghuram, President

Final Order No. 52669 / 2015

Per: Justice G. Raghuram:

Notice of hearing of this appeal was despatched to the appellant on 30.06.2015 intimating the date of hearing today. When the matter is called, there is however no representation on behalf of the appellant including by Sh. Kamal Khemuka, ld. Advocate for the appellant. In the circumstances, the appeal is disposed of ex-parte after hearing the ld. DR for the respondent.

2. The assessee is the appellant. The appeal is preferred against the order dated 12.10.2009 of the ld. Commissioner (Appeals), Customs, Central Excise & Service Tax, Bhopal, which partly allowed an appeal preferred by the assessee.

3. Alleging failure to obtain registration, file returns and remit service tax on rendition of maintenance or repair service during 01.07.2004 to 31.03.2005, a show cause notice dated 22.09.2005 was issued demanding service tax amounting to Rs.58,266/- apart from interest and penalties under Sections 76, 77 and 78 of the Act. After a due process, the Assistant Commissioner, Customs, Central Excise and Service Tax, Division, Jabalpur passed an order dated 30.01.2009 confirming the demand as proposed including interest and penalty. The primary authority observed that the assessee had neither replied to the show cause notice nor had appeared for personal hearing.

4. Aggrieved, the assessee preferred an appeal inter-alia contending that he was a Proprietorship entity, was not therefore a commercial concern, which was the description in the provision for identification of a provider of the specified taxable service, of management, maintenance or repair service; and that there was no contract between the assessee and the recipient of the service i.e. OPM, Amlai and thus no liability to tax. The lower appellate Authority considered both the contentions and concluded that in view of the decision in CCE vs. R.S. Financial Services  (2008) 12 STT 257, a business run by a sole proprietor would nevertheless amount to business by proprietary concern; and the fact that the assessee was a proprietorship did not derogate from its liability to service tax. Analysing assessees contention that he had provided no services under a contract, the impugned order concluded that there was a work order issued in favour of the assessee which amounts to a maintenance or repair service contract and therefore this contention, was misconceived.

5. It requires to be noticed that the ld. lower appellate authority fairly found that consideration of Rs. 55960/-, out of the total consideration of Rs.6,72,376/- received during the relevant period was relatable to rendition of manpower recruitment agency service by the assessee, which was neither taxable during the period nor was the show cause notice issued in this regard. Therefore, the impugned order reduced the liability to tax of Rs.53,790/- which is on rendition of maintenance or repair service, after excluding the amount of service tax on the value of Rs.55960/- which was attributable to rendition of manpower or recruitment service provided by the assessee. The lower appellate Authority also dropped penalties under Section 76 of the Act and reduced the quantum of penalty imposed under Section 78 of the Act to the amount of reduced service tax confirmed by the said Authority.

6. On a careful consideration of the facts and circumstances of the case, I find no reason for appellate interference. The concurrent findings by the authorities below, that the assessee/ appellant was a commercial concern and provided maintenance or repair service during the period in issue under a contract entered into with the recipient M/s OPM Amlai, suffers no infirmity.

7. On the aforesaid analyses, the appeal is rejected but in the circumstances without costs.

(Justice G. Raghuram)

President

Pant