Custom, Excise & Service Tax Tribunal
Cce, Chandigarh vs M/S.Dynamic Motors on 4 November, 2011
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL,
WEST BLOCK NO.II, R.K. PURAM, NEW DELHI-110066.
SINGLE MEMBER BENCH
Court No.3
Appeal No.ST/263/2010-SM
(Arising out of Order-in-Appeal No.191/CE/CHD-I/2010 dt.28.12.2010 passed by the CCE(A), Chandigarh-II)
Date of Hearing/Decision: 04.11.2011
For approval and signature:
Honble Mrs.Archana Wadhwa, 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 should 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?
CCE, Chandigarh Appellant
Vs.
M/s.Dynamic Motors Respondent
Present for the Appellant: Shri S.K.Bhaskar,SDR
Present for the Respondent: Shri Pawan Kumar Pahwa, Advocate
Coram: Honble Mrs.Archana Wadhwa, Member (Judicial)
ORDER NO._______________
PER: ARCHANA WADHWA
Being aggrieved with the order of the Commissioner (Appeals), the Revenue has filed the present appeal. I have heard Shri S.K.Bhaskar, learned SDR appearing for the Revenue and Shri Pawan Kumar Pahwa, learned Advocate appearing for the respondent.
2. As per facts on records, the respondents are authorised dealers for vehicles manufactured by General Motors and fall under the category of authorized service station. They are registered with the service tax department under the said category as also under the business auxiliary servicers. During the period October, 2006 to December, 2007, they also undertook the servicing of vehicles manufactured by the other manufacturers. The Revenue entertained a view that they were liable to pay service tax in respect of such servicing of vehicles i.e. other than the vehicle of General Motors. Accordingly, proceedings were initiated against them by way of issuance of show cause notices which demanded the payment of service tax of Rs.50,010/-,Rs.94,463/- and Rs.35,995/-.
3. The original adjudicating authority, by relying upon the Boards Circular No.699/15/2003 dt.5.3.03 which clarified that as per section 65 (8) of the Finance Act, 1994, the Authorized Service Station means any service station, or centre, authorized by any motor vehicle manufacturer to carry out any service or repair of any motor car or two wheeled motor vehicle manufactured by such manufacturer, dropped the demand by observing that the service tax is leviable only on such services which are provided in relation to motor cars or two wheeled motor vehicle for which service station was authorized.
4. Being aggrieved with such dropping of demand, the Revenue challenged the said order before the Commissioner (Appeals) who referred to the definition of taxable services as per section 65 (105) (zo) of the Finance Act, 1994 and definition of authorized service station as per section 65 (9) of Finance Act, 1994 and held that only those services provided in respect of vehicles for which an assessee is authorized with principal manufacturer of vehicle, are liable to be taxed. He accordingly, rejected the Revenues appeal and upheld the impugned order of the original adjudicating authority. Hence, the present appeal.
5. The Revenue in their grounds of appeal has contended that section 65 (105) (zo) of the Finance Act, 1994 defines Taxable Service as provided by authorized service station. Inasmuch as the respondents were authorized service station, the fact that they provided services in respect of the vehicles manufactured by the manufacturer other than the General Motors will not make any difference. It also stands contended that the Boards circular No. 699/15/2003 dt.5.3.03 was contrary to the statutory definition of the taxable services under the category of Authorized Service Station. As such, the same was subsequently withdrawn by the Board. Accordingly, it stands contended that once a service station has been authorized by any manufacturer of the motor vehicles, the said authorized service station is liable to pay service tax in respect of motor vehicles of all brands irrespective of fact that other manufacturer have not authorized the said service station. The Revenue accordingly has prayed for setting aside the impugned order and allowing the appeal.
6. After hearing the learned Advocate appearing for the respondents, I find that the taxable service stands defined under section 65 (105) (zo) of the Finance Act, 1994 as under:-
Taxable Service means any service provided or to be provided to any person, by any authorized service station, in relation to any service, repair, reconditioning or restoration of motor cars, light motor vehicles or tow wheeled motor vehicles, in any manner.
7. As is seen from the above definition of taxable service, the same is required to be provided by an authorized service station. To find out who is authorized service station, I look into the definition of the same as appearing under section 65(9) of the Act. For the purpose of ready reference, the same is reproduced below:-
authorized service station means any service, or centre, authorized by any motor vehicle manufacturer, to carry out any [service, repair, reconditioning or restoration] of any motor car, light motor vehicle or two wheeled motor vehicle manufactured by such manufacturer.
8. The said definition of the authorized service station includes centre or station authorized by any motor vehicle manufacturer, to carry out any service, in respect of vehicles manufactured by such manufacturer. The use of phrases manufactured by such manufacturer makes it clear that authorization has to be given by the manufacturer of vehicles. As such, authorized service station is required to be authorized for providing services to the vehicles of such manufacturer only and not by any manufacturer. The authorization by the manufacturer of motor vehicle is basic criteria for a person for categorisation of any centre as authorized service station and services provided is only in relation to said vehicle manufactured by those manufacturers. If an assessee has provided services to the vehicle manufactured by other manufacturer for which he is not authorized service station, the same cannot be held authorized service station vis-`-vis by that manufacturer of vehicle. If that be so, services provided in respect of vehicle cannot be held to be taxable services, in the light of the definition of the authorized service station appearing under section 65 (9) of Finance Act. The Revenues contention is the service station may be authorized by any manufacturer and services provided by them in respect of the vehicle manufactured by other manufacturers for which it will not be authorized are to be held as taxable services, cannot be accepted, in view of the specific definition of the authorised service station in terms of section 65(9) ibid.
9. In view of foregoing, I find no infirmity in the view taken by original adjudicating authority as also appellate authority, the Revenues appeal is accordingly rejected.
(Pronounced in the open court) (ARCHANA WADHWA) MEMBER (JUDICIAL) mk 6