2019 (2) TMI 765 - AT - Service Tax

Abatement under N/N. 1/2006-ST for Commercial or Industrial Construction Service - abatement under N/N. 17/2005- ST in respect of Site Formation, Excavation, Earth Moving and Demolition Services - Management, Maintenance & Repair being in the nature of works contract services - Held that - These services are not being acceptable prior to 01.06.2007 and not being chargeable to service tax under Works Contract Service post 01.06.2007 because the demand was not made under this head - these aspects need to be considered by the original adjudicating authority after following principles of natural justice. Penalty - Cleaning services - Held that - It is hard to hold that sweeping of roads or cleaning of drains cannot be considered as cleaning services as claimed by the appellant - the appellant has not disclosed any of the services to the Department and these came to light only by investigation by the Department and therefore having not made out any case for exemption from penalty under section 78. Appeal decided partly against assessee and part matter on remand.

Summary

Issues:
Appeal against demand for service tax under various heads - Management, Maintenance & Repair Service, Site Formation, Excavation, Earth moving and Demolition Service, Commercial or Industrial Construction service, Cleaning service.

Management, Maintenance & Repair Service:
The appellant contended that their activities should be considered as construction of a railway line, falling under Works Contract Service. They argued that maintenance of immovable property like railway lines should not be taxed as maintenance or repair. The appellant also claimed that the service provided included both material supply and necessary service, falling under Works Contract Service. The tribunal directed the original authority to reconsider the demand in light of these contentions.

Site Formation, Excavation, Earth Moving and Demolition Service:
The appellant claimed entitlement to abatement under notification No. 17/2005-ST, which was not granted to them. The tribunal directed the original authority to reassess the demand after examining the eligibility for abatement.

Commercial or Industrial Construction Service:
The appellant argued that they were eligible for abatement under notification No. 01/2006-ST, which was not provided to them. The tribunal directed the original authority to review the demand after considering the eligibility for abatement.

Cleaning Service:
The tribunal upheld the demand for service tax on cleaning service, rejecting the appellant's claim that sweeping of roads and cleaning of drains should not be considered cleaning services. The tribunal noted that the appellant did not disclose these services to the department, and thus, no case for exemption from penalty under section 78 was made out.

The appeal was disposed of by remanding it to the original authority for reconsideration on various demands and penalties. The tribunal directed the original authority to reassess the demands for Management, Maintenance & Repair Service, Site Formation, Excavation, Earth Moving and Demolition Service, and Commercial or Industrial Construction Service, along with interest and penalties, based on the contentions raised by the appellant. The appeal was ultimately disposed of with the above directions given to the original authority for further proceedings.