2009 (11) TMI 199 - HC - Service Tax

Consulting engineer s service- Respondent is a central government undertaking and as such the dispute between the government or department of the government or between the government and a public sector undertaking is required to be adjudicated by the Committee of Disputes as per the order of the Hon ble Supreme Court. Tribunal held that- Respondent did not have professionally qualified engineers and it did not provide advice, consultancy professionally qualified engineers and it did not provide advice, consultancy professionally qualified engineers and therefore, its activity would not come within the ambit of consulting engineer s service . Committee held that order of Tribunal did not suffer from any infirmity and, accordingly, decline permission to revenue to pursue appeal before High Court as no substantial question of law was involved. Thus, the appeal filed by revenue rejected.

Summary

Issues:
1. Whether the activities undertaken by the respondent fall under Consulting Engineer Services.
2. Whether the respondent had professionally qualified engineers.
3. Whether the respondent provided advice, consultancy, or technical assistance to clients.
4. Applicability of the judgment in Tata Consultancy Services v. Union of India.

Analysis:

1. The main issue in this case is whether the respondent's activities fall within the scope of Consulting Engineer Services under the Finance Act, 1994. The dispute involves a Central Government undertaking, and it is noted that disputes between different wings of the government or between the government and a Public Sector Undertaking are required to be adjudicated by the Committee of Disputes, as per the precedent set by the Supreme Court in the Oil & Natural Gas Commission case.

2. Following the filing of the appeal, the Commissioner of Central Excise and Service Tax submitted a Reference Application to the Committee of Disputes, as per the ONGC case. The Committee, after considering the arguments of both parties, concluded that the CESTAT's order from 2006 did not have any defects. Consequently, the Committee declined permission to the Central Board of Excise and Customs to pursue the appeal further, as it did not involve any substantial questions of law. As a result, the appeal was rejected, as the Committee's decision was final.

3. The specific issues raised by the revenue in this case include questioning the legality and correctness of the CESTAT's order. The revenue challenged the findings related to the respondent's activities, the qualification of engineers, the provision of advice and consultancy, and the application of the Tata Consultancy Services judgment. However, the Committee of Disputes found no fault with the CESTAT's order and refused permission for the appeal to proceed, ultimately leading to its rejection.

In conclusion, the judgment highlights the importance of following established procedures in resolving disputes involving government entities and emphasizes the role of specialized committees in adjudicating such matters. The decision underscores the significance of legal interpretations and the application of relevant precedents in determining the outcome of tax-related disputes.