Custom, Excise & Service Tax Tribunal
M/S. Basti Sugar Mills Ltd vs C.C.E., Allahabad on 31 July, 2015
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
WEST BLOCK NO.2, R.K. PURAM, NEW DELHI 110 066.
Date of Hearing 31.07.2015
For Approval &Signature :
Honble Honble Justice G. Raghuram, President
Honble Mr. R.K. Singh, Member (Technical)
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/434/2007-CU[DB]
[Arising out of Order-in-Appeal No.12/ST/ALLD/2006, dated 28.03.2007 passed by the C.C.E.(Appeals), Allahabad]
M/s. Basti Sugar Mills Ltd. Appellant
Vs.
C.C.E., Allahabad Respondent
Appearance Mr. Bipin Garg, Advocate - for the appellant Mr. Rajiv Tandon, DR - for the respondent CORAM: Honble Justice G. Raghuram, President Honble Mr. R.K. Singh, Member (Technical) Final Order No.52706/2015, dated 31.07.2015 Per Mr. R.K. Singh :
Appeal has been filed against Order-in-Appeal dated 28.03.2007 in terms of which service tax demand of Rs.18 lakhs for the period April, 1999 to March, 2000 was upheld along with interest and penalties. The impugned demand was upheld on the ground that the appellant did not pay service tax under Management Consultant Service for an amount of Rs.3,60,00,000/- received from M/s. ABB Alstom Power India Ltd. as consultancy income. The Commissioner (Appeals) observed that the said amount was received from M/s. ABB Alstom Power India Ltd. against providing Management Consultant Service although the appellant had contended that the scope of work mentioned in the contract with M/s. ABB Alstom Power India Ltd. was as Business Promotion and Support Services, Customer Care, Product Launching, Customer Education Program and Energy Consultancy.
2. The appellant has contended that (i) the agreement for providing the service was entered into between M/s. ABB Alstom Power India Ltd. and the head office of M/s. Basti Sugar Mills located at New Delhi. The services were rendered at New Delhi and amount of commission was also paid by the service recipient to the appellant at New Delhi and therefore Allahabad Central Excise Commissionerate had no jurisdiction to issue the Show Cause Notice or adjudicate the case. The jurisdiction to raise demand or adjudicate the case was with the Central Excise or Service Tax Commissionerate, New Delhi. (ii) There was no suppression or wilful mis-statement on itsr part and cited judgement of Supreme Court in the case of Indian oil Corporation versus CC [2005 (191) ELT 1996 (SC)] to support the proposition that for invoking the longer period of 5 years, the assessee must be guilty of withholding information deliberately with intent to evade payment of service tax. (iii) The service rendered did not fall under the category of Management Consultancy Service in-as-much-as business promotion may fall under Business Auxiliary Service (BAS) (which became taxable in July, 2003) and customer care may fall under Commercial Training or Coaching Service which became taxable in July, 2003 and Energy Consultancy was related to saving of energy by the customers of the service recipient which could be covered under Consulting Engineers Service which was became taxable from 2006.
3 We have considered the contentions of the appellant. We find that the agreement to provide service was entered into by the registered office (headquarters) of M/s Basti Sugar Mills at New Delhi where the service recipient is also located. The service was also rendered at New Delhi. Thus, there is force in this contention of the appellant that Central Excise, Allahabad had no jurisdiction over the headquarters of the appellant. In addition, we do not find any analysis in the lower authorities orders as to how the service rendered falls under the scope of Management Consultancy Service. Management Consultant, is defined in section 65 (65) of the Finance Act ,1994 which is reproduced below:-
Management Consultant means any person who is engaged in providing any service, either directly or indirectly, in connection with the management of any organisation in any manner and includes any person who renders any advice, consultancy or technical assistance, relating to conceptualizing, devising, development, modification, rectification or upgradation of any working system of any organisation. As per the agreement, the following service was provided-
Business promotion and support service, customer care product launching, customer education programme and energy consultancy. The primary adjudicating authority or the Commissioner (Appeals) has not analysed as to how business promotion and support, customer care, product launching, customer education program and energy consultancy would fall within the scope of Management Consultant Service. On the face of it, the scope of the service rendered would not get covered within the scope of service rendered in connection with the management of the organisation of the service recipient nor did it amount to advice, consultancy or technical assistance relating to conceptualising devising development, modification, rectification, or upgradation of any working system of the organisation of the service recipient. Indeed on the face of it and also as argued by the appellant, business promotion and customer care may fall under BAS; similarly, Business Support Services may fall under the scope of support service for business or commerce, customers education program could as a remote possibility be covered under commercial coaching or training service and energy consultancy could, again as a remote possibility, be part of Consulting Engineers Service. The short point being made is that it does not come out from the Order-in-Appeal or the Order-in-Original as to how the service was covered under the scope of Management Consultant Service. It has to be stated that the description of service rendered namely Business Promotion and Support Services, Customer Care, Product Launching, Customer Education Programme and Energy Consultancy is so sketchy that by the said description it is impossible to classify the said service and Revenue has made no effort to marshal any evidence/reason to show as to how the same would be covered under Management Consultant Service. No attempt seems to have been made to identify the exact nature of service rendered and then to classify the same. It is settled principle that the onus is on Revenue to show that the service rendered was classifiable under a particular taxable service and there is no scope for assumption or presumption in this regard. In such circumstances, the impugned demand cannot be sustained
4. In the light of the foregoing discussion, we allow the appeal and set aside impugned order.
(Justice G. Raghuram) President (R.K. Singh) Member (Technical) SSK -5-