2010 (9) TMI 293 - AT - Service Tax

Waiver of pre-deposit - Business Auxiliary Service - Mechanical work for printing - no support service provided for promotion or marketing, the printing of bill - law as appearing in the statute book during the relevant period for which demand has been raised relates to all incidental or auxiliary activity to the activities enumerated by law in such clauses (i) to (vi) of Section 65(19) of Finance Act, 1994 no full waiver of pre-deposit at the interim stage

Summary

Issues:
1. Whether printing of bills on a computer constitutes Business Auxiliary service under Section 65(19)(vii) of the Finance Act, 1994.
2. Whether the nature and scope of service provided by the Appellant falls under Business Auxiliary service.

Analysis:

Issue 1:
The Appellant argued that printing bills on a computer should not be considered Business Auxiliary service as it involved only mechanical work without any support service for promotion or marketing. The Appellant presented work orders from BSNL and MTNL, along with a purchase order from Gestetner (India) Ltd., now Ricoh India Ltd., to demonstrate that the services provided did not relate to business promotion. Reference was made to a Tribunal decision in the case of Business Information Processing Services v. CCE, Jaipur, to support this argument. The Appellant contended that the adjudicating authority did not properly address the nature of the activity in question.

Issue 2:
The Departmental Representative (D.R.) contended that the Appellant's services fell within the scope of Business Auxiliary service and were correctly deemed taxable by the adjudicating authority. After hearing both sides and reviewing the relevant documents, the Tribunal noted that the definition of 'Business Auxiliary Service' had been amended. It was highlighted that any activity incidental or auxiliary to the activities specified in Section 65(19) of the Finance Act, 1994, would be covered under the residuary clause (vi) of the section. The Tribunal, in line with the legislative intent, concluded that activities supporting or effectuating the specified activities would be taxable. Citing the Supreme Court decision in the case of Dunlop India, the Tribunal directed the Appellants to deposit Rs. 20 lakhs within four weeks and comply by a specified date, with a stay on the realization of the balance demand pending the appeal process.

This comprehensive analysis of the judgment highlights the arguments presented by both parties, the Tribunal's interpretation of the relevant legal provisions, and the final decision rendered in the case.