2024 (2) TMI 1020 - AT - Service Tax

Classification of services - leaning Activity Services or not - rendering the services of Evacuation of Ash from ash ponds and nuisance-free transportation and disposal of the ash to Thermal Power Stations - HELD THAT - The issue is no longer res integra as CESTAT Kolkata has decided the issue in the case of Purba Medinipur Jilla Parishad vs. Commissioner of Central Excise, Haldia 2018 (12) TMI 1780 - CESTAT KOLKATA wherein it has been held that the activity of 'Evacuation of Ash from ash ponds and nuisance-free transportation and disposal in defined area provided by the plant' is not liable for service tax under the category of 'Cleaning Services'. Thus, the activities of Evacuation of Ash from ash ponds and nuisance-free transportation and disposal of the ash in Thermal Power Stations is not liable to service tax under the category of 'Cleaning Services' - the demands of service tax along with interest and penalty confirmed in the impugned orders set aside - appeal allowed.

Summary

Issues Involved:
Four appeals filed against impugned orders for service tax demands. Issue of whether activities related to "Evacuation of Ash from ash ponds and nuisance-free transportation and disposal" are taxable under "Cleaning Activity Services."

Service Tax Appeal No. 75902 of 2017 and Service Tax Appeal No. 79247 of 2018:
Appellant challenged confirmed demand of service tax of Rs. 6,39,32,967/- and Rs. 2,06,37,126/- respectively. Contention that activities of ash evacuation not liable for service tax under "Cleaning Services."

Service Tax Appeal No. 75903 of 2017:
Appellant challenged confirmed demand of service tax of Rs. 5,77,42,642/-. Similar contention as other appeals regarding non-liability for service tax under "Cleaning Services."

Service Tax Appeal No. 75897 of 2018:
Appellant challenged confirmed demand of service tax of Rs. 1,37,26,829/-. Similar contention as other appeals regarding non-liability for service tax under "Cleaning Services."

Judgment Details:
The issue in all appeals was whether activities related to "Evacuation of Ash from ash ponds and nuisance-free transportation and disposal" are taxable under "Cleaning Activity Services." Appellants argued citing precedents that such activities are not liable for service tax under this category. Tribunal referred to prior decisions and held that the activities in question do not fall under "Cleaning Services," setting aside the demands of service tax, interest, and penalty confirmed in the impugned orders.

Significant Legal References:
- Tribunal decisions in similar cases supported the appellants' argument.
- Definition of "Cleaning activity" under Section 65(24b) of the Finance Act was crucial in determining non-liability for service tax.
- Precedents highlighted the distinction between activities covered under "Cleaning Services" and those involving transportation and disposal, ultimately supporting the appellants' position.

Conclusion:
The Tribunal ruled in favor of the appellants, setting aside the impugned orders and allowing all four appeals. The judgment emphasized that the activities of ash evacuation and transportation are not subject to service tax under the category of "Cleaning Services."