2010 (6) TMI 119 - AT - Service Tax

Consulting Engineering services- in this case the department made a demand of service tax on the ground of Consulting Engineering services . While the appellant already registered with the Ministry of Science & Technology, and paying income tax. Held that- the activity carried out by the respondent is Scientific and Technical Consultancy and not Consulting Engineering Services. Taking into account the registration made with the Ministry of Science & Technology, Department of Scientific & Industrial Research and also the findings of the learned first appellate authority. Consequently, Revenue s appeal is dismissed.

Summary

Issues:
Categorization of services as 'Consulting Engineering services' or 'Scientific and Technical Consultancy Services'.

Analysis:
The appeal before the Appellate Tribunal CESTAT, Mumbai involved a dispute regarding the categorization of services provided by the respondent. The Revenue contended that the services should be classified as 'Consulting Engineering services' instead of 'Scientific and Technical Consultancy Services'. The Revenue argued that the first appellate authority erred in categorizing the services without examining the substance of the transactions. The respondent, on the other hand, asserted that it is a 'Scientific Research Institution' registered with the Government of India, Ministry of Science & Technology, Department of Scientific & Industrial Research. The respondent also highlighted that it had been assessed under the Income-tax Act 1961 as a Scientific Research Institution. The Appellate Tribunal considered the arguments presented by both sides and examined the records.

Upon reviewing the first appellate authority's order and considering the registration with the Ministry of Science & Technology, Department of Scientific & Industrial Research, the Tribunal concluded that the activity carried out by the respondent indeed fell under the category of Scientific and Technical Consultancy services, not Consulting Engineering Services. The Tribunal found merit in the respondent's contentions and the findings of the first appellate authority. Consequently, the Tribunal dismissed the Revenue's appeal, ruling in favor of the respondent.

Additionally, the cross-objection filed by the respondent was also disposed of by the Tribunal. The judgment was pronounced in court by Member (Technical) S.K.Gaule and Member (Judicial) D.N.Panda.