2012 (5) TMI 601 - AT - Service Tax

Summary

Issues involved:
The issues involved in the judgment are the taxation of different contracts related to maintenance, supply of goods, and commercial construction activities u/s service tax laws.

Issue 1: Taxation of maintenance work on immovable property
The appellant argued that the maintenance work related to immovable property should not have been taxed before 16.6.2005. The work on the underground drainage and manholes in the railway colony was considered as repair and maintenance, falling under the scope of service tax.

Issue 2: Taxation of supply of goods
Regarding the contracts for making and provisioning of work bench, store rack, conference table, and chairs, the appellant contended that these activities were not repair and maintenance but rather supply and sale of goods. Therefore, the supply and sale of goods should not be subject to taxation.

Issue 3: Classification of commercial and industrial construction activities
The appellant argued that the extension of platform No. 1, providing circulating area and toilet blocks at the station, fell under the category of commercial and industrial construction activities, which were taxable w.e.f. 10.9.04. The Revenue wrongly classified the activity as repair and maintenance, leading to erroneous taxation.

Issue 4: Levy on pure supply of goods
For the contracts involving the supply of fish bolts and improvement of the triangulated area in the platform, the appellant claimed that there was pure supply of goods without any service element involved. Therefore, no levy was warranted on these transactions.

Judgment Summary:
The Appellate Tribunal considered the arguments presented by the appellant regarding the different contracts subject to taxation. It was observed that the maintenance work on immovable property, supply of goods, and commercial construction activities were wrongly taxed or classified by the Revenue.

Upon analysis, the Tribunal found that the balance of convenience tilted in favor of the appellant. The authorities had failed to consider all aspects of the receipts, and it was clarified that service tax is applicable only on taxable services provided, not on the sale of goods. As a result, the requirement of pre-deposit during the pendency of the appeal was waived.

In a separate Stay Petition, the Tribunal granted the same order of waiver of pre-deposit as in the main appeal, emphasizing the importance of considering each aspect of the transactions before levying service tax.