2013 (4) TMI 609 - AT - Service Tax

Demand of service tax/interest/penalty laying of the cables - repair and maintenance service. - Held that - On perusal of the work order placed on record, it is clear that the service provided by the Respondent to BSNL is in relation of laying of the cables, are not repair and maintenance. In view of this, we held that there is no infirmity in the impugned order. Revenue s appeal is dismissed. The Cross-objection also stands dispose of.

Summary

Issues:
1. Whether the Respondent was liable to pay Service Tax for repair and maintenance services provided to BSNL.
2. Whether the activity of the Respondent constituted repair and maintenance or laying of underground cables.
3. Validity of the Show Cause Notice and orders passed by the Additional Commissioner and Commissioner (Appeals).
4. Decision on the appeal filed by the Revenue and the Cross-objection filed by the Respondent.

Analysis:
1. The Respondent, a Service tax assessee, was alleged to have provided repair and maintenance services to BSNL without paying Service Tax. The Department issued a Show Cause Notice for demand of Service Tax amounting to Rs. 8,54,647/- along with interest and penalties under sections 76, 77 & 78 of the Finance Act, 1994.

2. The Additional Commissioner, in the Order-in-Original, dropped the proceedings against the Respondent after finding that their activity was not repair and maintenance of cable but laying of underground cables, which was not taxable under Section 65(105) of the Finance Act, 1994. The Commissioner (Appeals) upheld this decision, stating that the work performed by the Respondent was related to laying of cables, not repair and maintenance, as per Board's Circular.

3. The Revenue filed an appeal against the Commissioner (Appeals) order, and the Respondent filed a Cross-objection. The Tribunal noted that the Show Cause Notice lacked details of the work carried out by the Respondent. Upon reviewing the work order, it was evident that the service provided was related to laying of cables, not repair and maintenance. The Tribunal held that the activity was not taxable as repair and maintenance, dismissing the Revenue's appeal and disposing of the Cross-objection.

4. The Tribunal emphasized that the mere mention of "OFC route maintenance" in the tender did not imply repair and maintenance services. The decision was based on the nature of the work carried out by the Respondent, which was laying of cables. The Tribunal found no fault in the impugned order and upheld the dismissal of the Revenue's appeal and disposal of the Cross-objection.

This detailed analysis of the judgment highlights the key issues involved, the arguments presented by both parties, and the Tribunal's decision based on the facts and legal provisions presented during the proceedings.