2013 (9) TMI 208 - AT - Service Tax

Incidence to levy Service tax on waste disposal facility - Business support service - waste management - stay - disposal of hazardous waste - use of therms developer , operator and generator - Held that - organizational set up of a concern does not decide taxability - Incidence of levy was decisive - Service tax was either performances based or property based - Such a basic principle had been enunciated in All India Fedn. of Tax Practitioners v. UOI 2007 (8) TMI 1 - Supreme Court - Reading of Section 65(105)(zzzq) of the Act brings incidence of levy of Service tax in view of support to business or commerce provided by these appellants to generators - The word service was a noun of the verb to serve . What is service - Held that - The word service is a noun of the verb to serve . Apex Court in Coal Mines Provident Fund Commissioner v. Ramesh Chandra Jha 1990 (1) TMI 264 - SUPREME COURT held that it is an act of helpful activity - help, aid or to do something and while doing so, it may also involve supplying of utilities or commodities. The first part of definition in Section 65(104c) of the Act provides scope to tax the activity which renders support to business or commerce or in relation thereto while inclusive part of definition which is second limb of law declares certain category of services to be taxable. There is no iota of doubt that both the appellants carried out commercial activity for certain commercial considerations. There was no charity. Service provided by both the appellants was in relation to business to enable the business concerns (generators) to dispose their waste which was their obligation under law - Such obligation of business houses made the activity carried out by the appellants to be related to business and provision of taxable service - It was noticeable from the features of the contracts between the parties that there was regularity and continuity of commercial activity carried out by them to provide taxable service - The service provided to support business or commercial activity or in relation thereto satisfy the principle of performance based taxation. Prima facie case is against the assessee - Keeping in view the taxable service provided, interest of Revenue, scope and ambit of taxing entry, incidence thereof and principles of service tax flowing from Apex Court decision in the case of All India Federation of Tax Practitioners & Ors Versus Union of India & Ors 2007 (8) TMI 1 - Supreme Court and HOME SOLUTIONS RETAILS (INDIA) LTD. Versus UNION OF INDIA & ORS 2011 (9) TMI 46 - DELHI HIGH COURT - stay granted partly.

Summary

Issues:
Delay condonation in appeal process, Stay applications in multiple appeals, Tax demand with interest and penalties, Interpretation of service tax provisions for waste management services, Arguments on taxability of services provided, Prima facie view on tax liability, Direction for pre-deposit by the appellants.

Delay Condonation and Stay Applications:
The delay of 28 days in removing defects in the appeal process was condoned as it was not mala fide or deliberate. Stay applications in multiple appeals were considered together due to a connected appeal arising, ensuring a common hearing for all applications.

Tax Demand, Interest, and Penalties:
Tax demands depicted in the table were followed by interest, with penalties levied on the appellants under Sections 77 & 78 of the Finance Act, 1994. The case involved service tax demands under the taxing entry of support of service of business or commerce under Section 65(105)(zzzq) of the Act.

Interpretation of Service Tax Provisions for Waste Management Services:
The case revolved around waste management services provided by appellants in collaboration with regulatory bodies and industry members. The agreements entered into by the parties were crucial in determining the tax liability under the service tax provisions.

Arguments on Taxability of Services Provided:
The appellants argued against the tax liability, stating that they did not provide taxable services under the relevant provisions. They emphasized the nature of their activities and the absence of taxable service provision.

Prima Facie View on Tax Liability:
The tribunal's view was that the appellants did provide taxable services under the relevant provisions. The commercial nature of the activities, agreements, and receipts indicated a service provided in relation to business or commerce, satisfying the principles of performance-based taxation.

Direction for Pre-Deposit by the Appellants:
Considering the taxable service provided, the tribunal directed the appellants to make specified pre-deposits within a given timeline. The decision differentiated between the appellants based on their roles and financial aspects related to the services provided.

This detailed analysis of the judgment covers the issues involved comprehensively, highlighting the key legal arguments, interpretations, and directions provided by the tribunal regarding the tax liability and pre-deposit requirements for the appellants.