2015 (10) TMI 2475 - AT - Service Tax

Cleaning services provided to Guru Gobind Singh Super Thermal Plant (GGSSTP) Ropar Punjab - Appellant contended that it cannot be said that the service was provided to the commercial or industrial building and the premises thereof or factory plant or machinery tank or reservoir of such commercial or industrial building and premises thereof. - Held that - The power plant of the Electricity Board cannot be called a non-commercial concern in the normal sense of word as it produces electricity and sells the same. Indeed electricity cannot be sold at any price less than the price fixed by the appropriate regulatory authority. Therefore the cleaning service rendered by it to GGSSTP Ropar clearly falls within the scope of cleaning service as defined in Section 65 (24b) read with Section 65 (105) (zzzd) ibid. Prima facie case is against the assessee - Stay denied.

Summary

Issues:
1. Miscellaneous Application seeking recall of the order dated 14.07.2015
2. Stay Application filed against Order-in-Appeal dated 17.12.2012 regarding service tax demand for cleaning services provided to a power plant

Analysis:
1. Miscellaneous Application:
The Miscellaneous Application was filed to recall the order dismissing the stay application and ordering pre-deposit of the assessed liability. The application cited the absence of the appellant's advocate due to typhoid, supported by medical records. The Tribunal allowed the application and recalled the Stay Order, emphasizing the reasonable ground justifying the advocate's absence.

2. Stay Application:
The appellant filed a stay application against an Order-in-Appeal upholding a service tax demand for providing cleaning services to a power plant. The appellant argued that the service was not provided to a commercial or industrial building, citing judgments from CESTAT cases. The Tribunal considered the contentions and determined that the power plant, being an electricity producer selling electricity at regulated prices, fell within the scope of cleaning services under relevant sections of the Finance Act, 1994. The Tribunal distinguished previous cases cited by the appellant, emphasizing the commercial nature of the activity.

3. Decision:
After analyzing the contentions and precedents, the Tribunal found in favor of the Revenue, ordering pre-deposit of the entire disputed service tax amount within six weeks. The appellant was directed to report compliance by a specified date, with a stay on recovery of remaining liabilities during the appeal. Failure to comply would result in dismissal of the appeal. Any amount already deposited towards the service tax demand would be considered part of the pre-deposit. The decision highlighted the commercial nature of the power plant's activities, leading to the imposition of the service tax liability.