2018 (2) TMI 1047 - AT - Service Tax

Supply of tangible goods service - appellant is claiming these are accommodations created at site. The Revenue is claiming that these are tangible goods supplied by the client - Held that - these bunk houses are in fact created on concrete platform at site with various components and accessories and as such, there is no supply of bunk-house to be called supply of tangible goods in the present arrangement. The bunk-house accommodation is created at site based some on permanent concrete base with some dismantable components - there is no identified supply of bunker-houses as considered by the lower authorities - appeal allowed - decided in favor of appellant.

Summary

Issues: Liability to Service Tax for provision of bunk-houses

Analysis:
The appellant challenged the order of the Commissioner (Appeals) regarding the liability to Service Tax for providing bunk-houses to M/s. Cairns Energy India Pvt. Ltd. The Revenue demanded Service Tax, treating the amount received as supply of tangible goods service. The appellant argued that the bunk-houses were provided as per a service order, including facilities like housekeeping and meals. The appellant contended that the bunk-houses were created on-site, not supplied as ready-built structures. The Revenue claimed the bunk-houses were movable property and liable for service tax. The Tribunal examined sample photographs and observed that the bunk-houses were assembled on a concrete platform at the designated site, with additional facilities like washbasins. The Tribunal concluded that the bunk-houses were not supplied as tangible goods but were accommodations created on-site. The Tribunal disagreed with the lower authorities' view that the entire consideration for providing bunk-houses constituted supply of tangible goods. Consequently, the Tribunal set aside the impugned order and allowed the appeal.

Conclusion:
The Tribunal ruled in favor of the appellant, holding that the provision of bunk-houses for M/s. Cairns Energy India Pvt. Ltd. did not constitute a supply of tangible goods attracting Service Tax. The bunk-houses were deemed as accommodations created on-site with various components and accessories, rather than being supplied as ready-built structures. The Tribunal's decision overturned the earlier order confirming the Service Tax demand and penalties, emphasizing that the nature of the bunk-houses and the terms of the service order supported the appellant's position that no tangible goods were supplied in the arrangement.