2018 (9) TMI 1371 - AT - Service Tax

Classification of Services - services of painting the outer wall on newly constructed buildings - whether classifiable under Maintenance and Repair Services or under Works Contract Services? - extended period of limitation. Held that - With the introduction of Works Contract category of service w.e.f. 01.06.2007, the appellant had started discharging its service tax liability under the said category - Hon ble Supreme Court decision in the case of Commissioner of Central Excise & Customs, Kerala vs. Larsen & Toubro Ltd. 2015 (8) TMI 749 - SUPREME COURT , held that the assessee cannot be held liable to pay service tax under a different category prior to 01.07.2007, if the service falls under Works Contract . Extended period of Limitation - Held that - The entire facts were revealed to the Revenue and were in their knowledge in which cases the extended period of limitation cannot be invoked against the assessee. Demand set aside both on merits as well as on limitation.

Summary

Issues:
1. Applicability of service tax category - Maintenance and Repair vs. Works Contract
2. Demand raised by Revenue for service tax payment
3. Interpretation of the Hon'ble Supreme Court decision regarding service tax liability prior to 01.07.2007
4. Invocation of extended period of limitation against the assessee

Analysis:

1. The case involved a dispute regarding the correct category for service tax payment by the appellant - Maintenance and Repair services or Works Contract services. The appellant initially paid service tax under Maintenance and Repair but later switched to Works Contract category after its introduction in June 2001.

2. The Revenue raised demands against the appellant for service tax payment under Maintenance and Repair services for specific periods, totaling to significant amounts, through show cause notices dated 08.12.2009. The impugned orders by the Original Adjudicating Authority and Commissioner (Appeals) were based on these demands.

3. The Tribunal referred to the Hon'ble Supreme Court decision in the case of Commissioner of Central Excise & Customs, Kerala vs. Larsen & Toubro Ltd. The Tribunal highlighted that as per this decision, an assessee cannot be held liable to pay service tax under a different category before 01.07.2007 if the service falls under Works Contract. The Tribunal emphasized that the Revenue was aware of all relevant facts, and the extended period of limitation cannot be invoked against the assessee.

4. Considering the above points, the Tribunal concluded that the demands raised by the Revenue were not sustainable both on merits and limitation grounds. Therefore, the impugned orders were set aside, and both appeals by the appellant were allowed.

This detailed analysis of the judgment from the Appellate Tribunal CESTAT ALLAHABAD highlights the key issues, arguments, and the final decision rendered in the case, providing a comprehensive understanding of the legal intricacies involved.