2009 (4) TMI 775 - Commissioner - Service Tax

Summary

Issues:
Classification of services under Management Consultant Service based on the nature of work provided.

Analysis:
The appeal was filed against an Order-In-Original passed by the Assistant Commissioner of Central Excise, where the appellant, a liaison service provider, was charged with not registering or paying service tax for the period from 1-4-2002 to 31-3-2004. The department categorized the appellant's activities as falling under Management Consultant Service. The adjudicating authority confirmed a demand of service tax, interest, and penalties. The appellant contested this classification, arguing that their liaison work did not involve providing advice or consultancy services. They presented a certificate from the client, which the authority overlooked. During the personal hearing, the appellant's representatives submitted their arguments.

Upon reviewing the case records, the Commissioner found that the appellant's work involved liaising between the client and its customers, handling purchase orders, payments, bank deposits, and accounts reconciliation. Citing a Tribunal decision in a similar case, the Commissioner noted that such functions did not constitute management consultancy. The Commissioner emphasized that the appellant did not provide management-related services, advice, or technical assistance. Relying on a relevant case law, the Commissioner concluded that the appellant's services did not fit the definition of Management Consultant Service. Consequently, the Commissioner set aside the Order-In-Original and allowed the appeal.