2014 (10) TMI 813 - AT - Service Tax

Classification of service - Scientific or technical consulting services or survey and map-making service - Held that - Revenue wants to classify the service under scientific and technical consultancy service . As per the provisions of the Finance Act, Scientific or technical consultancy means any advice, consultancy, or scientific or technical assistance, rendered in any manner, either directly or indirectly, by a scientist or a technocrat, or any science or technology institution or organization, to any person, in one or more disciplines of science or technology. - Respondents had not provided any advice or consultancy or scientific or technical assistance rather the respondents had undertaken a job of digitization of maps. In view of this, we find no infirmity in the impugned order - Decided against Revenue.

Summary

Issues:
Classification of services under 'scientific or technical consultancy service' or 'survey and map-making service'.

Analysis:
The appeal before the Appellate Tribunal CESTAT MUMBAI involved the classification of services provided by the respondents. The Revenue contended that the activities undertaken fell under 'scientific or technical consulting services', while the respondents argued that their work constituted 'survey and map-making service'. The case revolved around the demand for service tax on the services provided by the respondents, which included digitization of maps, feature capture from satellite images, and vectorization of village maps.

The Revenue issued a show cause notice demanding service tax, which was confirmed by the adjudicating authority. However, on appeal, the Commissioner (Appeals) set aside the demand, ruling that the activities fell under 'survey and map-making service', which was taxable only post a specific date. The Tribunal noted that the Revenue sought to classify the service under 'scientific and technical consultancy service' as per the Finance Act. However, the Tribunal observed that the respondents did not provide advice, consultancy, or technical assistance but were engaged in the digitization of maps.

The Tribunal analyzed the definition of 'scientific or technical consultancy' under the Finance Act, which includes advice, consultancy, or technical assistance in disciplines of science or technology. Since the respondents were involved in digitization activities rather than providing consultancy, the Tribunal found no basis to classify the services under 'scientific or technical consultancy service'. Consequently, the Tribunal dismissed the appeal, upholding the decision of the Commissioner (Appeals) that the services provided by the respondents fell under 'survey and map-making service', exempt from service tax before a specified date.

In conclusion, the Tribunal's judgment clarified the distinction between 'scientific or technical consultancy service' and 'survey and map-making service', emphasizing the nature of the services provided by the respondents in this case. The decision highlighted the importance of accurately categorizing services for tax purposes based on the actual activities performed, as outlined in the relevant legal provisions.