Custom, Excise & Service Tax Tribunal
Hub Global Technologies vs Service Tax - Ahmedabad on 30 January, 2019
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
West Zonal Bench AHMEDABAD
COURT NO. I
Appeal No. ST/310/2009 -DB
[Arising out of Order-in-Appeal No OIA-139/2009/STC/LMR/COMMR-A-/AHD
dated 28.04.2009 passed by Commissioner (Appeal) of Central Excise & ST,
Ahmedabad]
M/s. Hub Global Technologies : Appellant
vs.
Commissioner of Service Tax, Ahmedabad : Respondent
Appearance:
None for the Appellant Shri S.N. Gohil, Superintendent (AR) for the Respondent CORAM:
Hon'ble Mr. Ramesh Nair, Member (Judicial) Hon'ble Mr. Raju, Member (Technical) Date of Hearing : 17.01.2019 Date of Decision : 30.01.2019 Final Order No. A/10206 / 2019 Per : Ramesh Nair The brief facts of the case are that, the appellant are registered as service provider under the category of 'Commercial Training or Coaching Services'. They filed ST-3 returns for the period October 2004 to March 2005 and April 2005 to September 2005, under the category of service provider of Commercial Training or Coaching Services. From the verification of ST-3 return, it was noticed that appellant had availed exemption Notification No. 16/2004 dated 10.09.2004 and not paid service tax on the 2 Appeal No. ST/310/2009 -DB services provided as 'Enterprise Resource Planning' (ERP). The case of the department is that since the appellant are registered as Commercial Coaching or Training Service provider, the said service is not eligible for exemption under Notification No. 16/2004-ST and therefore, the appellant have wrongly availed the exemption. Accordingly, the demand was confirmed denying the exemption notification. Being aggrieved by the order-in-original, the appellant filed appeal before the Commissioner (Appeals). The Commissioner (Appeals) upheld the order-in-original except for waiving the penalty imposed under section 78. Being aggrieved by the order-in-appeal, the appellant filed the present appeal.
2. None appeared on behalf of the appellant. However, on going through the grounds of appeal, we find that the appellant have provided the service of ERP software system. Though the appellant are providing the service of Commercial Training or Coaching Services for computer software but also providing service of ERP software system on behalf of the clients to their employees or candidates. It was submitted that for the purpose of ERP software service they have not applied to add the category of Management Consultant, however, at the time of filing of ST-3 return they disclosed the claim of exemption. They also submitted that the penalty imposed under section 76, 77 and 78 are liable to be set-aside invoking Section 80 of the Finance Act. In this regard they placed reliance on the following judgments:- 3
Appeal No. ST/310/2009 -DB
(a) CCE. Bhopal vs. Thyrocare Services - 2006 (4) STR 200 (Tri. Del)
(b) CCE, Jaipur vs. Sikar Ex-Serviceman Welfare Co-op Soc. Limited -
2006 (4) STR 213 (Tri. Del.)
(c) Suri Colour Labs (P) Limited vs. CCE, Meerut - 2006 (4) STR 96 (Tri. Del.)
(d) Surat Municipal Corpn. vs. CCE, Surat - 2006 (4) STR 44 (Tri. Del.)
(e) BST Limited vs. CCE, Cochin - 2006 (4) STR 40 (Tri. Bang.)
(f) Cosmic Dye Chemical vs. CCE, Bombay - 1995 (75) ELT 721 (SC)
3. Shri S.N. Gohil, Ld. Superintendent (AR) appearing on behalf of the Revenue reiterates the findings of the impugned order. He placed reliance on the judgment of the Tribunal in the case of Intelligroup Asia Pvt. Limited vs. CCE, Hyderabad - 2016 (46) STR 679 (Tri. Bang.).
4. We have carefully considered the submissions made by both sides and perused the record. We find that there is no dispute that appellant have provided ERP software service. ERP software service is explicitly exempted under Notification No. 16/2004-ST dated 10.09.2004, which reads as under:-
Service tax exemption to service provided by management consultant in respect of Enterprise Resource Planning Software System In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts the taxable service provided to a client in respect of Enterprise Resource Planning software system by a management consultant in connection with the management of any organization in any manner, from the whole of service tax leviable thereon under section 66 of the said Act.
[Notification No. 16/2004-S.T., dated 10-9-2004] From the reading of the above notification, it can be seen that the specific service, ERP System provided by a management consultant in connection 4 Appeal No. ST/310/2009 -DB with management of any organization, in any manner, is exempted. This notification itself endorses that the service of ERP software system is part and parcel of Management Consultancy Service. The only lapse on the part of the appellant is that they have not got the service i.e. Management Consultancy service added in the registration. Only because of this reason, it cannot be said that ERP software system service is not covered under 'Commercial Training or Coaching Services', whether the appellant have applied for registration or otherwise in their classification of service, will not change the position. Therefore, we are of the considered view that ERP Software system service provided by the appellant is clearly eligible for exemption under Notification No. 16/2004-ST dated 10.09.2004. Accordingly, the demand raised holding that the service is of 'Commercial Training or Coaching Services' and not eligible for said exemption, is absolutely incorrect.
Accordingly, the impugned order is set-aside and the appeal is allowed.
(Order pronounced in the open court on 30.01.2019) Raju Ramesh Nair Member (Technical) Member (Judicial) KL