Customs, Excise and Gold Tribunal - Delhi
Metzeler Automotive Profile India (P) ... vs C.C.E. on 6 May, 2004
Equivalent citations: 2004(169)ELT153(TRI-DEL), 2006[3]S.T.R.280, [2007]6STT522
ORDER
K.K. Usha, J. (President)
1. Heard both sides. Demand is raised against the appellant for Service Tax on the allegation that they are rendering service as consulting engineer. Such allegation is made on the basis that the appellants have received amount under the heading "design and development charges" during the year 1997-98 and 1998-99. Appellant would submit that it has not given any service to the automobile manufacturers. The appellants designed and developed the moulds and its components in accordance with the specification given by the customers which are used to manufacture different parts, to be supplied to the automobile manufacturers. Such activity will not attract Service Tax.
2. We find a strong case in favour of the appellants. Design and development charges are paid by the vehicles manufacturers to help the appellants to meet the initial layout of expenditure in developing tooling and mould necessary for the manufacture of the components. The activity undertaken by the appellant would not come within the term 'service rendered by a consulting engineer'. The condition for pre-deposit is waived and there will be a stay for recovery of the demand. Appeal is posted for regular hearing to 10-8-2004.