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2024 (8) TMI 1102 - AT - Service TaxLevy of service tax - transportation of goods through pipeline/conduit service - works contract service - period from 01.04.2013 to 31.03.2014. Advance Received against Transmission Charges from Tea Estate and other consumers - HELD THAT - The same issue has already been settled by this Tribunal in the appellant s own case Final Order Nos. 76345-76346 of 2024 dated 25.06.2024 2024 (8) TMI 396 - CESTAT KOLKATA where it was held that Any interest therefore earned thereon shall not be includible in the gross taxable value for purpose of assessment. The department has woefully failed to establish any nexus with the security deposit to the discharge of the taxable service per se nor has it been borne out of record that such deposit in any way influences the value of the service rendered. It thus cannot form part of the taxable service and demand on this account for the aforesaid amount of Rs.40, 77, 945/- is required to be set aside. - thus the demand of service tax confirmed in the impugned order on this count is not sustainable. Amount against cost of Gas Meter and installation charges - HELD THAT - The amount is collected as security deposit in terms of Section 14 of the PNGRB Act 2006. Further this amount is refundable at the time of surrender of the connection. Hence no taxable service is rendered and the amount is not liable to Service Tax - the demand of service tax confirmed in the impugned order on this count is not sustainable. Reconnection charges collected against re-installation - HELD THAT - Regarding the demand of Rs.1, 483/- on the reconnection charges against re-installation it is observed that the appellant has not contested this demand. Further in the appellant s own case this Tribunal vide Final Order 2024 (8) TMI 396 - CESTAT KOLKATA has held that the appellant is liable to pay Service Tax on re-connection charges - the appellant is liable to pay service tax along with interest on the reconnection charges received by them. However there is no suppression of fact with intention to evade the payment of tax exist in this case and hence no penalty is imposed on this demand. Penalties - HELD THAT - All the penalties imposed on the appellant are set aside. Appeal disposed off.
Issues:
1. Demand of Service Tax on transportation of goods through pipeline/conduit service and works contract service. 2. Confirmation of demand by Ld. Commissioner (Appeals) on various categories including advance received against transmission charges, cost of gas meter and installation charges, and reconnection charges. Detailed Analysis: Issue 1: The Appellant, a State Public Sector Undertaking, was issued a Show Cause Notice demanding Service Tax on taxable services not paid for the period from 01.04.2013 to 31.03.2014. The Ld. Additional Commissioner confirmed the demand along with interest and penalty under Section 78 of the Finance Act, 1994. On appeal, the Ld. Commissioner (Appeals) upheld the demand of Service Tax and penalty. The Appellant challenged this order. Issue 2: The Appellant contested the demands under three categories: A. Advance Received against Transmission Charges: The Appellant argued that the advance collected was a security deposit to secure payment, refundable at contract termination, and not part of taxable service. Citing a previous Tribunal decision, the demand was held unsustainable. B. Amount against Gas Meter and Installation Charges: The amount collected as security deposit under the PNGRB Act, refundable at connection surrender, was deemed not liable for Service Tax based on a previous Tribunal decision. C. Reconnection Charges: The Appellant agreed to pay this demand as confirmed by a previous Tribunal decision. Judgment: The Tribunal analyzed each category: A. Advance Received against Transmission Charges: The demand was set aside based on the previous Tribunal decision, ruling the amount as a security deposit not subject to Service Tax. B. Amount against Gas Meter and Installation Charges: The demand was set aside as the amount collected was a security deposit and not a consideration for taxable service, aligning with the previous Tribunal decision. C. Reconnection Charges: The demand was upheld as the Appellant was liable for Service Tax based on a previous Tribunal decision. No penalty was imposed due to the absence of tax evasion intent. Outcome: The Tribunal set aside demands on advance against transmission charges and gas meter installation charges, upheld the reconnection charges demand, and waived all penalties. The appeal was disposed of accordingly.
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