2015 (2) TMI 95 - AT - Service Tax

Site formation and clearance, excavation and earth removing and demolition - top soil removal and excavation of mud/soil upto the level of dolomite stone - Invocation of extended period of limitation - assessee contended that services provided by it do not fall within the ambit of site formation and clearance, excavation and earthmoving and demolition but fall more appropriately within the ambit of mining service, which was introduced subsequently w.e.f. 1-6-2007. Mining services is defined in Section 65(105)(zzzy) as a service provided in relation to mining, mineral oil or gas. Held that - On a consideration of the services provided by the appellant to M/s. Lafarge India, it is clear that the service does not fall within the ambit of mining service, since no part of the petitioner s obligation under the agreement with M/s. Lafarge India Pvt. Ltd., relates to mining or extraction of minerals. The agreement provides only for removal of overburdens, an activity falling clearly within the ambit of Section 65(97a) of the Act, prima facie. - Stay granted partly.

Summary

Issues: Appeal against order of Commissioner (Appeals) rejecting appeal against adjudication order for service tax demand and penalties. Interpretation of services provided falling under "site formation and clearance, excavation and earth removing and demolition" vs. "mining" service. Waiver of pre-deposit of assessed liability.

In the present case, the appellant appealed against the order of the Commissioner (Appeals) rejecting the appeal against the adjudication order for service tax demand and penalties. The appellant provided services of top soil removal and excavation of mud/soil under a work order issued by a cement manufacturing company. The audit revealed that the services provided fell under "site formation and clearance, excavation and earth removing and demolition" as per Section 65(97a) read with Section 65(105)(zzza), making it taxable. Despite not obtaining registration for taxable services, the appellant failed to file returns and remit the Service Tax due, leading to initiation of proceedings under the proviso to Section 73(1) of the Finance Act, 1994.

The primary order confirmed the service tax demand, interest, and penalties, with an option for the appellant to comply by remitting the assessed liability within thirty days. However, the appellant did not comply within the specified period, leading to the rejection of the appeal by the Commissioner. The appellant argued that the services provided should be categorized as "mining" service introduced later, but the Tribunal found that the services did not relate to mining or extraction of minerals, falling under the definition of "site formation and clearance" instead.

The Tribunal granted a waiver of pre-deposit of the assessed liability on the condition that the appellant remits the Service Tax and interest within a specified timeframe. The appellant claimed to have remitted a part of the assessed liability after the appellate order, which would be considered for credit while making the pre-deposit as ordered. The stay application was accordingly disposed of, with the Tribunal emphasizing compliance with the order for waiver of pre-deposit within the stipulated timeline to avoid rejection of the appeal.