2014 (12) TMI 662 - AT - Service Tax

Classification of service - Business support service - Cleaning services of toilets and coaches in trains - Whether cleaning of railway coaches and toilets and supply of bed-rolls to the passengers of AC and other coaches would get covered by Business Support Service or Business Auxiliary Service so as to make the appellant liable to service tax - Held that - Following decision of Deepak & Co., Vs. CST, Delhi 2014 (7) TMI 493 - CESTAT NEW DELHI demand set aside - Decided in favour of assessee.

Summary

Issues:
Interpretation of service tax liability for cleaning railway coaches and supplying bed-rolls.

Analysis:
The judgment by the Appellate Tribunal CESTAT NEW DELHI, delivered by Mrs. Archana Wadhwa, addresses the issue of whether the cleaning of railway coaches, toilets, and supplying bed-rolls to passengers of AC and other coaches falls under Business Support Service or Business Auxiliary Service for the purpose of service tax liability. The Show Cause Notice initially proposed confirming service tax under Business Support Service, but the Commissioner (Appeals) later confirmed it under Business Auxiliary Service. The Tribunal referred to a recent decision in the case of Deepak & Co. vs. CST, Delhi Tribunal, where it was observed that the Commissioner (Appeals) had exceeded the scope of the show cause notice by considering the taxability of the activity under Business Auxiliary Service when it was initially raised under Business Support Service. This deviation was deemed impermissible based on precedents set by the Apex court. Consequently, the Tribunal set aside the impugned order and allowed the appeal in favor of the appellant.

In conclusion, the Tribunal, following the precedent set in the Deepak & Co. case, ruled in favor of the appellant by setting aside the order confirming service tax liability under Business Auxiliary Service. The judgment emphasizes the importance of adhering to the scope of the show cause notice and not extending the tax liability beyond what was initially raised. The decision provides clarity on the interpretation of service tax liability in cases involving cleaning services for railway coaches and the supply of amenities to passengers, ensuring a fair and consistent application of tax laws in such scenarios.