Ultratech Cement Ltd vs Cce, Jaipur-I

(Arising out of OIA No.129-130/(OPD)CE/JPR-II/2013 dt.23.9.13 passed by the CCE (Appeals), Jaipur-II)

Date of Hearing/Decision: 12.05.2015

For Approval & signature:

Honble Mr.Ashok Jindal, Member (Judicial)

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? No 3. Whether their Lordships wish to see the fair copy of the order? seen 4. Whether order is to be circulated to the Department Authorities? Yes

Ultratech Cement Ltd. Appellant

Vs.

CCE, Jaipur-I Respondent

Present for the Appellant: Shri Rahul, Advocate

Present for the Respondent: Shri G.R.Singh, AR

Coram: Honble Mr.Ashok Jindal, Member (Judicial)

FINAL ORDER NO.51703-51704/2015

PER: ASHOK JINDAL

The appellant is in appeals against the impugned orders denying credit of service tax paid on various services i.e. on printing of calendar, greeting cards, diaries and for organizing award function for students and booklets for contest and water harvesting systems during the period April, 2007 to March, 2011 and non payment of service tax on space renting for commercial purposes.

2. As both the appeals are arising out of common issue, therefore they are being disposed of by a common order.

3. The contention of the learned Consultant for the appellant is that printing of calendars, greeting cards, diaries, etc. are for the sale promotion activity of their business. Further awards function organized by them is also part of their sale promotion as the students to whom the awards have been given, they give innovative idea for usage of their products in the construction activity. These two services are integral part of the sale promotion activity of the appellant. He submits that the appellant are entitled to take credit on these services. For demand of service tax, it is the submission of the appellant that they are falling within the SSI exemption limit and their turnover during the impugned period remained below the threshold taxable limit during the period. Therefore, the impugned orders are to be set aside.

4. On the other hand, learned AR opposed the contention of the Consultant and submits that the activity of printing of calendar, greeting cards, diaries, etc and distribution thereof are not an activity of their business but are welfare or facilities provided to the employees. To support this contention, he relied on the decision of this Tribunal in the case of CCE, Nagpur vs. Manikgarh Cement-2010 (20) STR 456 (Tri.Bom.) and Oudh Sugar Mills Ltd. vs. CCE, Lucknow-2012 (282) ELT 541 (Tri.-Del.). For demand of service tax, he submits that the appellant is big organization and have multifarious business activities and it is not possible that the value of taxable service of whole organization is less than the threshold limit. Therefore, the appellant is liable to pay service on this service.

5. Heard the parties and considered the submissions.

6. In this case, the two issues are involved  (a) whether the appellant is entitled to take credit on the services namely, printing of calendar, greeting cards, diaries, etc and organization award functions or not (b) whether the appellant is liable to pay service tax under the category of renting of immovable property having turnover of less than the threshold limit of SSI exemption or not.

7. For availing credit on printing of calendar, greeting cards, diaries, etc., the appellant used these services for advertisement purposes of their products, therefore, these are integral part of their sale promotion. I accordingly, hold that the appellant is entitled to take credit on printing of calendar, greeting cards, diaries, etc. Further I hold that for organizing award functions, these activities are parts of their sale promotion as the students to whom the awards have been given, they give innovative idea for marketing their products in the public. Therefore, the said activities are also the activities for sale promotion. Accordingly, the appellant is entitled to take credit on printing of calendar, greeting cards, diaries, etc. and organizing award functions which are integral part of the sale promotion.

8. For demand of service tax under the category of renting of immovable property for the period 2007-08 to 2010-11, the total demand of Rs.44,030/- which is the below the threshold limit and the Revenue has not produced any contrary evidence that the appellant has crossed the threshold limit. In the absence of evidence, I hold that the appellants turnover is below the threshold limit of SSI exemption. Therefore, the appellant is not liable to pay service tax on these services. In these circumstances, I do not find any merit in the impugned orders of the Commissioner (Appeals) and the same are set aside. The appeals are allowed with consequential relief, if any.

(Dictated & Pronounced in the open court)

(ASHOK JINDAL)

MEMBER (JUDICIAL)

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