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2011 (11) TMI 308 - AT - Service TaxAuthorized service station - authorised dealers of General Motors - also undertook the servicing of vehicles manufactured by the other manufacturers demand in respect of servicing of vehicles of any other manufacturer imposed Held that - Authorization has to be given by the manufacturer of vehicles which is basic criteria for a person for categorisation of any centre as authorized service station and services provided is only in relation to said vehicle manufactured by those manufacturers. If an assessee has provided services to the vehicle manufactured by other manufacturer for which he is not authorized service station the same cannot be held authorized service station vis-a-vis by that manufacturer of vehicle. If that be so services provided in respect of vehicle cannot be held to be taxable services in the light of the definition of the authorized service station appearing under section 65 (9) of Finance Act 1994. - Decided against the Revenue.
Issues:
Interpretation of the definition of 'authorized service station' under the Finance Act, 1994 for the purpose of levying service tax on services provided for vehicles manufactured by different manufacturers. Analysis: The case involved a dispute regarding the liability to pay service tax on services provided by authorized dealers for vehicles manufactured by General Motors, who also serviced vehicles from other manufacturers. The Revenue contended that all services provided by an authorized service station are taxable, regardless of the manufacturer of the vehicle. The original adjudicating authority relied on a circular clarifying that service tax is leviable only on services related to vehicles for which the service station is authorized. The Commissioner (Appeals) upheld this view, emphasizing that only services provided for vehicles authorized by the principal manufacturer are taxable. The Revenue challenged this decision, arguing that the definition of 'Taxable Service' under the Finance Act includes services provided by authorized service stations, irrespective of the manufacturer of the vehicle. They claimed that a circular contrary to this definition was later withdrawn. However, the definition of 'authorized service station' specifies that services must be provided for vehicles authorized by the manufacturer, not any manufacturer. Therefore, services provided for vehicles from manufacturers other than the authorizing manufacturer cannot be considered taxable services under the Act. The presiding judge concurred with the original adjudicating authority and the Commissioner (Appeals), emphasizing that the authorization by the manufacturer of the vehicle is fundamental in categorizing a service station as authorized. Services provided must be in relation to vehicles manufactured by the authorizing manufacturer. Consequently, services for vehicles from other manufacturers cannot be deemed taxable under the Act. The Revenue's appeal was dismissed, affirming the decisions of the lower authorities. In conclusion, the judgment clarified that the definition of 'authorized service station' under the Finance Act, 1994 necessitates authorization by the manufacturer for services provided to be considered taxable. Services for vehicles not manufactured by the authorizing manufacturer are not subject to service tax, as per the specific definition outlined in the Act.
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