2007 (10) TMI 162 - AT - Service Tax

Not. 12/03 exempting cost of material used/sold in taxable value of Photography service, is applicable decisions relied upon by revenue are not applicable Comm.(A) has rightly followed the tribunal ruling revenue s appeal dismissed

Summary

Issues:
1. Whether the assessees are eligible for deductions under Notification 12/2003-ST for 'Photographic Services'?
2. Whether the Ministry's clarification denying deduction on consumables should be applied?
3. Whether the assessees provided sufficient evidence to support their claim for deductions?
4. Whether the Tribunal rulings and judicial discipline require the rejection of Revenue's appeal?

Detailed Analysis:
1. The appeals arose from Orders-in-Appeal setting aside Orders-in-Original by the Commissioner. The assessees provided 'Photographic Services' and were issued demand notices for not producing evidence for exemption under Notification 12/2003-ST. The Commissioner remanded the matter to grant deductions for inputs used. The Commissioner applied the Tribunal's ruling in M/s. Adlabs Ltd. The Revenue contended the Ministry's clarification should apply, but the Commissioner noted the Tribunal's Final Order allowing deductions for consumables in photographic services. The Revenue argued lack of supporting evidence from the assessees, citing a Supreme Court judgment on the constitutional validity of the Service tax imposition.

2. The JDR contended that the assessees were not eligible for deductions. The learned Counsel highlighted evidence of consumables provided by the assessees, which were examined by the Commissioner. The Counsel supported the legality of the order based on Tribunal rulings and previous dismissals of Revenue appeals on similar issues. The bench referred to previous Tribunal rulings like Shilpa Colour Lab, Digi Photo Laser Imaging, and M/s. Suvi Color Fotos & Anr., stating the issue was no longer open for debate, and the Revenue appeal should be rejected.

3. After careful consideration, the bench found that previous judgments had addressed the issue, including detailed examination of Revenue's arguments, leading to the rejection of the Revenue appeal. The Commissioner's decision to follow the Tribunal ruling was deemed appropriate. As there was no stay against the Tribunal ruling from the Apex Court, the bench upheld the principle of judicial discipline and rejected the appeals, concluding that there was no merit in the Revenue's arguments.