2014 (2) TMI 436 - AT - Service Tax

Management, maintenance or repair service - erection, commissioning or installation service - services being provided to Central Power Distribution Company of Andhra Pradesh and other State distribution companies - Held that - in view of retrospective exemption vide Notification No. 45/2010-ST dt. 20/07/2010, the service tax liability of the petitioner for the several taxable services provided to electricity distribution companies of Andhra Pradesh during 01/04/2004 to 30/11/2009, stands eclipsed. - Demand set aside - Decided in favor of assessee.

Issues:
1. Stay application disposal with consent of both sides.
2. Assessment of service tax and penalty.
3. Defence based on services provided to instrumentalities of the State.
4. Notification No. 45/2010-ST granting immunity from service tax.
5. Impugned adjudication order declared inoperative.

Analysis:
1. The judgment involves the disposal of a stay application with the consent of both sides, represented by the learned consultant for the appellant and the learned AR for the respondent- Revenue. The appeal is disposed of without the predeposit requirement, considering the facts and circumstances of the case.

2. The case pertains to the assessment of service tax amounting to Rs. 1,90,00,002/- along with interest and penalty as specified in the order dated 20/04/2011 by the Commissioner of Customs, Central Excise, and Service Tax, Hyderabad-II. The taxable services provided by the petitioner to various distribution companies included management, maintenance, repair services, erection, commissioning, installation services, transport of goods, rent-a-cab operator service, business auxiliary service, and manpower recruitment services. The appellant's defense that services were provided to instrumentalities of the State and no service tax was collected was deemed misconceived and rightly negated by the adjudicating authority.

3. It was brought to notice that the Central Government, through Notification No. 45/2010-ST dated 20/07/2010, granted immunity from the liability to remit service tax in relation to the transmission and distribution of electricity until 26/02/2010. This notification rendered the service tax liability of the petitioner for taxable services provided to electricity distribution companies of Andhra Pradesh between 01/04/2004 to 30/11/2009 eclipsed. Consequently, the appeal was allowed, and the impugned adjudication order dated 20/04/2011 was declared inoperative in light of Notification No. 45/2010-ST dated 20/07/2010. No costs were awarded in this regard.

4. The judgment highlights the significance of relevant notifications and legal provisions in determining the liability for service tax, emphasizing the need for a comprehensive understanding of such regulations in tax-related disputes. The case underscores the importance of legal defenses being grounded in accurate interpretations of statutory provisions to avoid misconceptions and ensure a fair adjudication process.

5. The decision showcases the role of appellate tribunals in carefully examining the factual and legal aspects of a case to arrive at a just and equitable outcome, considering the implications of relevant notifications and legal provisions on the liability for service tax. By allowing the appeal based on the immunity granted by Notification No. 45/2010-ST, the tribunal upholds the principles of fairness and adherence to statutory provisions in tax matters.

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