2018 (9) TMI 1918 - AT - Service Tax

Classification of service - security service or Supply of Cash Van Service - service of providing cash van to the bank for carrying cash from one place to another - Demand of Differential Duty alongwith interest and penalty - HELD THAT - The issue is no more res-integra and decided in the case of SRI ARMAN KHAN, FEDERAL UNITED 7 PROTECTION GROUP, FORCE 7 SECURITIES PVT. LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE SERVICE TAX, LUCKNOW 2018 (9) TMI 385 - CESTAT ALLAHABAD , where it was held that providing of cash van service with security guard is covered under cash van service‟ and cannot be termed as security services‟ as the dominant service is transportation of cash from one place to another through these cash vans. Therefore, the appellants are not liable to pay differential Service Tax under the category of security service‟. Demand do not sustain - appeal allowed - decided in favor of appellant.

Summary

Issues:
Determining liability for Service Tax on 'security services' provided by appellants and analyzing whether the dominant service is 'security service' or 'supply of cash van service'.

Analysis:
The judgment pertains to three appeals arising from a common impugned Order-in-Original, where the appellants were providing 'security services' to banks and cash van services for cash transportation. The Revenue alleged that the appellants were short paying Service Tax on 'security services' due to discrepancies in their financial documents and ST-3 returns. The original authority held the appellants liable for Service Tax on 'security services' based on the differential amount. However, after considering the agreements between the appellants and banks, the Tribunal found that the dominant service provided was the transportation of cash via cash vans, not 'security services'. This interpretation was supported by a precedent decision of the Tribunal regarding a similar issue involving excess baggage charges in the airline industry. The Tribunal concluded that the appellants were not liable to pay differential Service Tax under the category of 'security services', and consequently, no penalties were imposable. Relying on the precedent decision, the Tribunal set aside the impugned orders and allowed all three appeals, granting the appellants consequential relief.

In summary, the judgment resolved the issue of liability for Service Tax on 'security services' provided by the appellants by determining that the dominant service rendered was 'cash van service' for transporting cash, not 'security services'. This decision was based on a precedent ruling by the Tribunal and clarified the classification of services provided by the appellants, leading to the allowance of all three appeals and the grant of consequential relief to the appellants.