2008 (10) TMI 103 - AT - Service Tax

Consulting Engineer earlier matter had been remanded to the Commissioner for adjudication afresh after meeting the challenge raised by the appellants that they were not a firm of professionally qualified Engineers - Commissioner has passed the impugned order without following the directions contained in the remand order of this Tribunal - appellants have made a prima facie case against the impugned demand and penalties stay granted

Summary

Issues:
1. Whether M/s. Ravi Paints & Chemicals Limited (RPCL) rendered 'Consulting Engineer' service during the period 1999-2000 and 2000-2001.
2. Whether M/s. RPCL qualifies as a firm run by professionally qualified Engineers.
3. Whether the Commissioner followed the directions contained in the remand order of the Tribunal.

Analysis:
1. The Commissioner of Service tax, Chennai demanded service tax from M/s. RPCL for 'Consulting Engineer' services. The Tribunal set aside the revision order and remanded the matter for fresh adjudication, emphasizing that M/s. RPCL must satisfy the statutory definition of 'Consulting Engineer' to establish tax liability. The Tribunal directed the Commissioner to examine if M/s. RPCL met the definition and address the issue of limitation. The appeal was allowed for remand, ensuring M/s. RPCL's right to be heard.

2. M/s. RPCL appealed the subsequent order post-remand, arguing that the Commissioner failed to determine if RPCL was a firm led by professionally qualified Engineers. RPCL contended that the technical advice they provided required knowledgeable individuals, thus qualifying them as an Engineering firm. They challenged the presumption that only Engineering firms could offer such advice. RPCL asserted that the Commissioner did not adhere to the remand order's directives, seeking to set aside the demand and penalties imposed.

3. The Tribunal, after considering submissions from both parties, noted that the Commissioner had not addressed whether M/s. RPCL conformed to the definition of 'Consulting Engineer' as directed post-remand. The Commissioner presumed that only professionally qualified Engineers could provide the technical assistance in question. The Tribunal found that the Commissioner had not properly considered the challenge raised by M/s. RPCL and had not followed the remand order's directions. Consequently, the Tribunal ruled in favor of M/s. RPCL, granting a waiver of pre-deposit and staying the recovery of the demand and penalty until final disposal of the appeal.