2018 (8) TMI 31 - AT - Service Tax

Business Auxiliary Services - appellant is engaged in collecting of toll on Ahmedabad- Mehsana highway - case of appellant is that the activities is in the nature of statutory function of Government and the same are not taxable - Held that - The decision in the case of Ideal Road Builders Pvt. Limited vs. CST, Mumbai 2015 (8) TMI 592 - CESTAT MUMBAI deals with the issue raised in the instant case, where it was held that collection of tolls by the appellant is not considered as Business Auxiliary Service provided to NHAI - demand set aside - appeal allowed - decided in favor of appellant.

Summary

Issues:
Confirmation of demand under clause (iv) of the definition of Business Auxiliary Service and imposition of penalties under sections 76, 77, and 78.

Analysis:
The appeal was filed against the demand confirmation under clause (iv) of the Business Auxiliary Service definition and penalties imposition. The appellant, engaged in toll collection on a highway, argued that the activity is a statutory function and not taxable, citing relevant case laws. The respondent contended that the demand was made under a different clause of the definition pre and post-2004 amendments. The appellant highlighted a Tribunal decision exempting toll charges as tax, even post-2004. The Tribunal analyzed the arguments and cited a Mumbai Tribunal decision, emphasizing that the appellant was not providing services on behalf of NHAI but collecting toll as a fee, thus not rendering auxiliary services. The Tribunal referred to various decisions supporting the non-taxability of toll collection under Business Auxiliary Service, setting aside the impugned order and allowing the appeal with consequential relief to the appellants. The judgment reiterated that toll collection does not fall under Business Auxiliary Service based on previous authoritative judicial pronouncements, thus allowing the appeal.

This detailed analysis of the judgment provides insights into the issues addressed, arguments presented, case laws cited, and the Tribunal's reasoning leading to the decision to set aside the demand confirmation and penalties imposition related to Business Auxiliary Service.