Customs, Excise and Gold Tribunal - Delhi
Shree Sidhball Steels Ltd. vs C.C.E. on 9 February, 2007
Equivalent citations: [2007]10STJ30(CESTAT-NEW DELHI), 2007[8]S.T.R.191, [2007]9STT517
ORDER C.N.B. Nair, Member (T)
1. Heard both sides and perused the record.
2. The appellant Shree Sidhbali Steels Ltd. is a manufacturer of CTD Bars. In the year 2001-02, it prepared a "feasibility study" for a project and earned an income of over Rs. 16 lakhs. Under a SCN dt.28.6.04, service tax authorities alleged that the feasibility study in question was an Engineering Consultancy and therefore, liable to pay service tax which had been imposed on Consulting Engineers. Accordingly, service tax was demanded under the notice. That demand was confirmed in adjudication as well as in the first appeal before Commissioner of Central Excise (Appeals). The present appeal before us is directed against those orders.
3. The contention of the appellant is that, under the service tax provision during the relevant period, only professionally qualified engineers and engineering firms were covered for the levy. The submission is that, the appellant being a steel manufacturing firm, cannot be treated as an "Engineering Firm" and subjected to service tax as a Consulting Engineer in regard to the feasibility study.
4. Ld. Counsel would point out that this issue had come up for consideration before Tribunal in the case of Shakumbari Sugar and Allied Ind. Ltd. v. CCE reported in 2006 (76) RLT. 882 and other cases and the Tribunal held that during the relevant period, levy fell only on Engineering Firms and not on other firms. Ld. Counsel would submit that the issue, thus, remains settled in favour of the assessee and the appeal is required to be allowed.
5. Ld. DR would content that the revenue's demand is covered by the judgment of the Hon'ble High Court of Calcutta in the case of M.N. Dastur and Co. Ltd. v. UOI reported in 2005 (3) STJ. 685. He would draw our attention specifically to the findings in para 7 of the judgment. We may read that paragraph:
7. Having read the provisions in the context it is used and the scheme in which it is intended to be used and the object and purpose of enacting the statute and the absence of any intelligible differentia or a rational classification it has to be interpreted to include all kinds of firm, i.e. a business establishment. This again we must note that the Legislature had used the expression 'engineering firm'. The firm has been qualified by the word 'engineering'. Therefore, the work 'firm' has been used in this particular class of assessee to include all classes of firms dealing with engineering. The word 'firm' was not used for the purpose of indicating the constitution of the firm, namely, a proprietorship or partnership, but in order to identify a class of firm providing taxable service within the meaning of Section 65(48)(g).
6. The dispute in the above case was as to whether a limited engineering company would also fall in the category of engineering firms for the purpose of levy of service tax. It was not whether all companies or firms rendering engineering consultancy would be engineering firms. Therefore, the above judgment is of no avail to the revenue in the present dispute. We find that our decision in Shakumbari Sugar & Allied Inds. Ltd. was rendered after noticing the above judgment also.
7. Ld. DR also relies on a decision of this Tribunal in the case of IFFCO (Final order No. 4-2/06-ST dt.26.12.06). The judgment in the case of IFFCO is not on the question as to whether firms rendering Engineering Consultancy become Engineering Firms for that reason. Therefore, that judgment is also not attracted to the present case.
8. We find that the appellant's case is covered by our decision in the case of Shakumbari Sugar & Allied Ind. Ltd. and other cases. Following that judgment, the present appeal is allowed, with consequential relief, if any, to the appellant.
Order dictated in the open Court.