Custom, Excise & Service Tax Tribunal
Kone Elevators India Pvt.Ltd vs Commissioner Of Service Tax, Chennai on 24 November, 2014
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH
CHENNAI
Appeal No.ST/S/152/2011 & ST/230/2011
[Arising out of Order-in-Original No.16/2010-S.Tax/Ch.IV dt.28.9.2010 passed by the Commissioner of Service Tax, Chennai]
For approval and signature :
Honble Shri P.K. Das, Judicial Member
Honble Shri R. Periasami, Technical Member
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 the Members wish to see the fair copy of
the order? :
4. Whether Order is to be circulated to the Departmental authorities ? :
Kone Elevators India Pvt.Ltd. Appellant
Versus
Commissioner of Service Tax, Chennai Respondent
Appearance:
Shri Krishnan Srinivasan, Sr. Advocate For the Appellant
Shri Parmod Kumar, JC (AR)
For the Respondent
CORAM :
Honble Shri P.K. Das, Judicial Member
Honble Shri R. Periasami, Technical Member
Date of Hearing : 24-11-2014 Date of Decision : 24-11-2014
FINAL ORDER No.40847/2014
Per P.K. Das
1. As the issue involved lies in a narrow compass, after disposing the stay application, we take up the appeal for hearing. We find that in the appellant's own case, for the earlier period, the Tribunal disposed of the appeal at the stage of stay petition hearing.
2. After hearing both sides and on perusal of records, we find that the appellant is engaged in the manufacture of lifts. They paid central excise duty on the parts of lifts at the time of clearance from their factory. There is further activity of erection, commissioning and installation at their customer's premises. They paid service tax on a notional percentage of 15% of the contract value on erection, commissioning and installation. According to Revenue, the appellant is liable to pay service tax on 33% of the contract value as per Notification No.1/2006-ST dt. 1.3.2006.
3. Learned Senior Advocate argued the matter at length. He submits that in their own case for the earlier period, the Tribunal vide Final Order No.348/2012 and Stay Order No.206/2012 dt. 7.3.2012 remanded the matter to the adjudicating authority. On a query from the Bench, learned Senior Advocate submits that de novo adjudication proceedings is still pending. In support of his contention, he placed an affidavit stating that de novo adjudication is still pending.
4. For proper appreciation of the facts, we reproduce the relevant portion of the final order dt.7.3.2012 as under :-
"4. Heard both sides and perused the records. Prima facie, it appears that the entire period of adjudication involved was June05 to Sept07 and summarily it appears that appellants acted on the basis of a contract document available at page 56 of the appeal folder. That document exhibits that the appellant had supplied elevators/escalators followed by commissioning and installation thereof. The adjudication order does not reveal whether it was the only document available as is appearing at page 56 gives rise to demand or any other contract that was executed during the period under adjudication. So also it appears that a summary of examination was made by the adjudicating authority with a determination that service tax shall be leviable without examination of the factual aspect of the quantum of goods involved in respect of each contract executed. We may make it clear that Finance Act, 1994 is not commodity taxation law. It requires service declared as taxable service by law is to be taxed to the extent permitted by law. There were various pleas about the classification of service raised in the course of hearing. The appellant has also raised several grounds in its memorandum of appeal. While the quantum of levy is under challenge, also abatement whether permissible or not is not left unassailed. It would therefore be required to be examined each and every invoice involved for the period under adjudication and to arrive at a proper conclusion excluding the sale of goods, if any, from taxation, bringing out clearly the service aspect appropriately classifiable under taxing entry under Section 65 of the Finance Act, 1944 subject to permissible abatement, if any and tax.
5. In view of our preliminary observations as above, we have viewed that as revenue stake being very high, it would not be proper to keep the matter pending in Tribunal but to send it back for threadbare examination by original authority at the earliest. Therefore, dispensing predeposit, the matter is remitted to the adjudicating authority to determine incidence of levy and quantum of levy in accordance with law after granting fair opportunity of hearing to the appellant to adduce evidence it relies on material facts brought on record.
6. Both the stay application and appeal are disposed off in the manner indicated as above."
We find that in the present case also, the appellant had not produced the documents in support of their contention of sale of goods. It is seen that the appellant had arrived at a notional percentage of 15% of the contract value. The Tribunal already decided that this issue would be required to be examined by the adjudicating authority in detail.
5. In view of the above discussion, we set aside the impugned order and the matter is remanded to the adjudicating authority to decide afresh after examining the documents with the earlier remand order. Ld. Senior Advocate placed the decision of the Hon'ble Supreme Court in their own case in W.P (Civil) No.232 of 2005 dt. 6.5.2014 which would be examined by the learned adjudicating authority in de novo adjudication. It is needless to say that the adjudicating authority shall give proper opportunity of hearing before decision. As the matter is pending for a long time, we direct the adjudicating authority to decide the matter within a period of 4 months from the date of receipt of the order. The appeal is allowed by way of remand. Stay application is disposed of.
(Dictated and pronounced in open court)
(R. PERIASAMI) (P.K. DAS)
TECHNICAL MEMBER JUDICIAL MEMBER
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