2016 (11) TMI 60 - AT - Service Tax

Drilling and waste removal - whether the activity falls under the category of Site Formation service? - Held that - there is no dispute as to the fact that the contract which has been awarded to appellant was in respect of the drilling and removal of waste rock material from the site wherein Manganese Ore India Ltd., Jain Carbide and RBS & Co. were intending to do mining of manganese ore. We find that the first appellate authority as well as the adjudicating authority has correctly held that this activity of the appellant would get covered under the category of Site formation service. There is nothing on record to controvert such finding of the first appellate authority as well as the adjudicating authority. Reliance placed on the decision of case Avtar & Company 2014 (2) TMI 1130 - CESTAT MUMBAI where it was held that activity undertaken of the similar nature would fall under Site formation service. Extended period of limitation - Held that - the appellant had himself taken the registration under the category of Site formation service but did not indicate the turnover which is attributable to the site formation services. This itself calls for invocation of extended period. Appeal rejected - decided against appellant.

Summary

Issues:
Appeal against Order-in-Appeal, Service tax liability for site formation and clearance service, Appeal grounds on non-speaking order, Extended period invocation, Penalties imposition.

Analysis:
The appeal was against Order-in-Appeal SR/290/NGP/2010 dated 08.09.2010, where the appellant had undertaken waste removal and site formation activities under a contract with various companies for mining purposes. The revenue claimed the activity fell under Site Formation and Clearance service, issuing a show-cause notice for service tax, interest, and penalties. The appellant contested on grounds of the order being non-speaking, the introduction of mining services post the activity period, and lack of intention to evade tax, among others.

The Departmental Representative argued that the scope of Site formation service applied to the appellant's activities, citing precedents where similar issues were decided against the appellants. The Tribunal found that the contract awarded to the appellant involved waste removal and drilling for mining purposes, falling under Site formation service as held by the lower authorities. The Tribunal referenced a previous case to support this classification, emphasizing the inclusion of drilling, excavation, and related activities within the taxable service definition.

Regarding the appellant's argument on the extended period, the Tribunal noted that the appellant's registration under Site formation service without indicating the turnover warranted the extended period invocation. Consequently, the Tribunal upheld the lower authorities' decision, rejecting the appeal and confirming the service tax liability, interest, and penalties imposed. The judgment highlighted the appellant's prior tax compliance under the same category and the lack of evidence to support the appellant's contentions, leading to the dismissal of the appeal.

In conclusion, the Tribunal affirmed the lower authorities' findings, emphasizing the applicability of Site formation service to the appellant's activities and the justification for invoking the extended period due to registration discrepancies. The judgment underscored the importance of tax compliance, proper categorization, and evidence in contesting service tax liabilities, ultimately upholding the decision against the appellant.