2023 (8) TMI 1236 - AT - Service Tax

Nature of transaction - Service or sale - Classification of service - Storing and Warehousing service or erection, commissioning and maintenance etc. - appellant supplied, installed, commissioned and undertaken maintenance of the bullets which was designed to store LPG meeting BIS standards - interest - penalty - HELD THAT - The issue of classification has reached finality in the appellants own case 2018 (6) TMI 198 - CESTAT CHENNAI as no appeal has been filed against the orders passed by this Tribunal for the earlier period on the same subject. The issues relating to Storage and warehousing service was clarified vide Letter F. No. B11/1/2002-TRU dated 1.8.2002 - None of these activities (as mentioned in the letter) are seen to be provided by the appellant to the customers, further unlike in a warehouse, the goods (LPG) stored in the bullet storage facility installed at the customers premises is not under the control of the appellant and the whole responsibility of the stored LPG is with the customer. Hence, they are not covered under the category of Storage and Warehousing Services as defined under Section 65(102) of the Finance Act, 1994. The legal issue has also reached a finality on merits. It is not deemed necessary to examine the issue raised by Revenue of whether deemed sale is involved or not and whether payment of VAT was necessary, at this stage. Since the issue is decided on merits in the appellants favour the other issues like payment of interest, penalty etc. do not survive. Appeal allowed.

Summary

Issues involved: Classification of services under 'Storage and Warehousing Services' for service tax liability.

Summary:

Issue 1: Classification of services under 'Storage and Warehousing Services'

The appellant, engaged in providing 'Storage & Warehousing Services' along with LPG services, was issued a Show Cause Notice proposing service tax demand. The original authority confirmed the demand, which was upheld by the Commissioner (Appeals). The appellant contended that their activity was not covered under 'Storage and Warehousing Services' as per previous Tribunal decisions and Article 366(29A) of the Indian Constitution. The appellant argued that since they had no control over the gas stored in the tanks, it did not qualify as storage services. The respondent, however, argued that the installation and maintenance of LPG storage units constituted a service under 'Storage and Warehousing Services'. The Tribunal noted that the appellant's activities did not align with the definition of 'Storage and Warehousing Services' as per Section 65(102) of the Finance Act, 1994. The Tribunal also highlighted that the issue had reached finality in the appellant's own case, and hence, the demand was set aside.

Decision:
The Tribunal set aside the impugned order, allowing the appeal in favor of the appellant due to the classification issue being decided in their favor. As a result, other issues like interest and penalty were not considered.

*( Pronounced in open court on 25.8.2023 )*