2003 (11) TMI 161 - AT - Central Excise

Summary

Issues:
1. Whether services rendered by a valuer of immovable property are liable to pay service tax as a Consulting Engineer under the Finance Act, 1994.

Analysis:
1. The main issue in this case was whether the services provided by a valuer of immovable property should be considered as taxable under the Finance Act, 1994, as a Consulting Engineer. The Revenue appealed against the Order of the Commissioner of Central Excise & Customs (Appeals), Bangalore, dated 28-10-1999.

2. The Revenue argued that valuation of immovable property should be regarded as advice in the nature of 'engineering advice' based on the knowledge of engineering, making valuers fall under the category of 'consulting engineers' as per the Finance Act, 1994. They cited a judgment by the Madras High Court supporting this view.

3. The respondents contended that since the valuer only valued the property without providing a composite service like in the case cited by the Revenue, it should not be considered a taxable service under the relevant sections of the Finance Act, 1994. They also argued against the imposition of a penalty in this case.

4. The Tribunal, after careful consideration, relied on the Madras High Court judgment and held that when an engineer, acting as a registered valuer of immovable property, provides advice based on engineering knowledge, it falls within the realm of 'engineering advice' and is considered a service by a 'consulting engineer' under the Finance Act, 1994. Consequently, the Tribunal upheld the levy of service tax on the services rendered by the valuer.

5. Regarding the penalty imposed, the Tribunal found it excessive and exercised discretionary power to reduce the penalty amount from Rs. 16,298/- to Rs. 5,000/-, considering the facts and circumstances of the case and the submissions made by the party. The Tribunal upheld the decision on service tax but reduced the penalty amount.

6. In conclusion, the Tribunal confirmed the duty as levied by the original authority, upheld the imposition of service tax on the services provided by the valuer, and reduced the penalty amount due to its discretionary power and the excessive nature of the original penalty imposed.

7. The decision was pronounced in open court on 12th November, 2003, with the Department's appeal being disposed of based on the above terms.