2008 (9) TMI 119 - AT - Service Tax

Respondent is having a Weighbridge and undertakes weighments of consignments in lorries and issues the slips recording the weight demand under head Business Auxiliary Service - As respondents are not concerned with the sale or marketing of the goods, therefore, cannot be said to be provider of incidental or auxiliary service to any activity such as promotion or marketing or sale of goods produced therefore, demand was rightly set aside by Commissioner (Appeals)

Summary

Issues:
Department's appeal against Commissioner (Appeals) order on classification of service as Business Auxiliary Service.

Analysis:
The case involves appeals by the Department against the order of the Commissioner (Appeals) regarding the classification of services provided by the respondent as Business Auxiliary Service. The respondent operates a Weighbridge, where they weigh consignments in lorries and issue weight slips. The Original Authorities considered these activities as falling under Business Auxiliary Service, leading to a demand of Rs. 71,152/- and imposition of penalties. However, the Commissioner (Appeals) overturned this decision, stating that the service of weighing goods did not pertain to the promotion, marketing, or sale of goods produced by the clients.

Both parties acknowledged that a similar issue had been decided in favor of the respondent by the Tribunal in a previous case. The Tribunal's decision in the earlier case highlighted that Business Auxiliary Service pertains to services related to the promotion, marketing, or sale of goods produced or provided by clients. Since the respondent was not involved in the sale or marketing of goods, they could not be considered as providing incidental or auxiliary services for such activities. Therefore, the Tribunal dismissed the appeals filed by the Department based on this precedent.

In conclusion, the Tribunal rejected the Department's appeals in light of the previous ruling and upheld the decision of the Commissioner (Appeals) regarding the classification of the services provided by the respondent. The judgment emphasizes the importance of the specific activities related to promotion, marketing, or sale of goods in determining the applicability of Business Auxiliary Service classification.