Custom, Excise & Service Tax Tribunal
M/S. Cinema Art, Studio & Colour Lab vs Cce, Meerut-I on 5 March, 2009
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL, WEST BLOCK NO. 2, R.K. PURAM, NEW DELHI COURT III SERVICE TAX APPEAL NO. 458 OF 2006 [Arising out of Revision Order No. 42/AYUKT/2006 dated 22.06.2006 passed by the Commissioner, Central Excise, Meerut-I, Meerut] For approval and signature: Honble Mr. M. Veeraiyan, Member (Technical) Honble Mr. P.K. Das, Member (Judicial) 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 would be released under Rule 27 of the 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? M/s. Cinema Art, Studio & Colour Lab. Appellant Vs. CCE, Meerut-I Respondent
Appearance:
Shri Anil Tiwari, Advocate, for the appellant;
Shri A.K. Madan, D.R., for the Revenue, Coram:
Honble Mr. M. Veeraiyan, Member (Technical); Honble Mr. P.K. Das, Member (Judicial), Date of hearing/decision: 5th March, 2009 FINAL ORDER NO._________________ dated __________ Per P.K. Das:
Heard both sides and perused the records.
2. The dispute relates as to whether the value of material for the process of developing and printing of Photography would be excludible from the taxable value of service.
3. The appellants filed refund claim for Rs. 3,32,035/- which was sanctioned by the Dy. Commissioner. By Revision Order, the Commissioner rejected the refund claim.
4. After hearing both sides, we find that the issue has already been decided by the Tribunal in the case of Delux Colour Lab Pvt. Ltd. vs. CCE, Jaipur vide Final Order No. ST/285 to 288/08 dated 22.10.2008. The relevant portion of the decision is reproduced below:-
12. It would thus appear that the decision in BSNL case lays down the law that works contract (and also catering contract) involves the element of both sale and service contract and that the service and sale elements can be split up. That being so, we do not find any merit in the submission of the Revenue that the decision in BSNL case cannot be treated as an authority on the issue of service tax. If the photography service is a works contract, it would follow that it involves the element of both sale and service, and the sale portion of the activity or transaction cannot be included in the taxable value of the service. There cannot be any doubt, in view of sub-clause (b) of clause (29-A) of Article 366, that deemed sale of the materials takes place in the rendering of photography service and, therefore, the value of the materials cannot be included while computing the value of service. Sale and Service can not stand in the same box. Sale cannot be treated as service and vice versa.
4. It has been held that the value of the material cannot be included while arriving at the value of service. In view of that, we set aside the Revision order and restore the order passed by the original authority. Appeal is allowed with consequential relief.
(Dictated & pronounced in the Open Court.) (M. VEERAIYAN) MEMBER (TECHNICAL) (P.K. DAS) MEMBER (JUDICIAL) RK