2018 (8) TMI 362 - HC - Service Tax

Interpretation of statute - agricultural and horticultural activities - Scope of Commercial or Industrial Construction Service - case of appellant is that there is absence of any levy in regard to landscape activity - Held that - What the assessee/appellant is thus contending is that the parliamentary exclusion of service in relation to agricultural horticultural animal husbandry etc. carved out in respect of a distinct item or subject of levy (cleaning activity) ought to be read into as an exclusion of another entry altogether i.e. Section 65(64) of the Finance Act which relates to management maintenance or repair activity - In support of its arguments the assessee has not relied upon any authority to say that the specific exclusion of one head or one commercial activity can generally be read in relation to other specific heads. Such an interpretation is also not supported by any principle of statutory construction and therefore has to fail. Appeal dismissed - decided against appellant.

Summary

Issues:
Whether the levy of service tax pursuant to the show cause notice was justified?

The appellant, engaged in construction activities, contested a show cause notice alleging liability to pay service tax for the period 2008-09 to 2010-11. The appellant disputed the liability citing Section 65(64) of the Finance Act, 1994. The Commissioner confirmed the show cause notice and imposed a penalty. The appellant appealed to the CESTAT, which granted relief for certain activities and the extended period, but confirmed the liability for landscape management activities. The appellant disagreed with the CESTAT's findings, arguing that managing gardens should not be considered maintenance or repair services. The CESTAT found the activities fell under Section 65(64) of the Finance Act, making the appellant liable for tax on managing and maintaining gardens. The appellant relied on the proviso to Section 65(24b) of the Finance Act, 1994, and judgments of the Supreme Court to support its position.

The demands were based on the construction of Section 65(64) of the Finance Act, defining "management, maintenance or repair" services. The appellant relied on Section 65(24b) of the Finance Act, defining "cleaning activity," arguing that the exclusion of services related to agriculture and horticulture under this section should apply to Section 65(64) as well. The appellant failed to provide authority or statutory construction principles supporting this interpretation. The Court held that such an interpretation was unfounded, and the concurrent findings did not warrant interference. No substantial question of law arose, leading to the dismissal of the appeal.