2018 (4) TMI 1406 - AT - Service Tax

Maintenance and Repair Services - re-conditioning of old and worn out Sugar Mill Rollers from other sugar mills - Held that - an indentical issue was the subject matter of the said decision of the Tribunal in the case of Jagat Machinery Pvt. Ltd. vs. Commissioner 2012 (12) TMI 478 - CESTAT NEW DELHI , wherein it stands held that the activity of re-conditioning of old and worn out shells of Sugar Mills Rollers, shall be liable to service tax only with effect from 16.06.2005 - the activity of re-conditioning of old and worn out sugar mills rollers would not be taxable prior to 16.06.2005. Time limitation - Held that - the department visited the factory on 28.10.2005 and all the details were submitted by the appellant to the department on 02.03.2006 and still the SCN was issued on 02.07.2007 - no malafide can be attributed to them so as to invoke the longer period of limitation. Appeal allowed on merits as well as limitation.

Summary

Issues:
Service tax liability on re-conditioning services provided by the appellant prior to 16.06.2005, invocation of longer period of limitations for raising demands.

Analysis:
The appeal arose from an Order-in-Appeal passed by the Commissioner of Central Excise & Customs, Ghaziabad, concerning the appellant's manufacturing activities related to Mill House New Rollers, Re-shelling of Rollers, and re-conditioning of old Sugar Mill Rollers. The Revenue imposed service tax on the re-conditioning services, claiming it falls under "Maintenance and Repair Services." The demands were raised invoking a longer period of limitations predating June 2006.

The appellant's advocate contended that re-conditioning was included in "Maintenance and Repairs Services" from 16.06.2005 onwards, and activities performed before this date should not be taxable under this category. While acknowledging part of the demand post the specified date, the advocate challenged the imposition based on limitations. Citing the Tribunal's decision in Jagat Machinery Pvt. Ltd. vs. Commissioner, it was argued that the re-conditioning activity should only attract service tax post 16.06.2005.

The Tribunal referred to the Jagat Machinery case, where it was held that re-conditioning of old Sugar Mill Rollers is taxable from 16.06.2005. Additionally, the Tribunal addressed the limitation issue, noting that the appellant had transparently provided all details to the Revenue without any malafide intent. Given the similarity of issues between Jagat Machinery's case and the present one, the Tribunal applied the former's decision to the ongoing dispute.

Consequently, the Tribunal ruled that re-conditioning of old sugar mills rollers is not taxable before 16.06.2005. Regarding limitations, it was observed that despite the department's visit in October 2005 and the appellant's submission of details in March 2006, the show-cause notice was issued in July 2007, indicating no malafide intentions on the appellant's part. Therefore, the Tribunal set aside the impugned orders, allowing the appeal both on merits and limitations.