2015 (9) TMI 991 - AT - Service Tax

Demand of service tax - Interior decorator service - appellant undertook various activities like carpentry work involving different types of furniture items modular partitions fixation of false ceiling painting of walls and ceilings etc. - Held that - Activities which are undertaken by the appellant are not falling under the category of interior decorator services . - impugned order is unsustainable and liable to be set aside - Decided in favour of assessee.

Summary

Issues:
1. Whether the appellant is liable to pay service tax for activities falling under "Interior decorator" as per Section 69 of the Finance Act, 1994.
2. Whether the activities undertaken by the appellant can be categorized as "Interior Decorator services" or fall under a different service category.
3. Whether the findings of the adjudicating authority and the first appellate authority are correct in holding the appellant liable for service tax.
4. Whether the appellant's activities align with the definition of "Interior Decorator" under Section 65(59) of the Finance Act, 1994.

Analysis:

1. The appellant was alleged to have undertaken various activities like carpentry work, modular partitions, false ceiling fixation, and painting, falling under "Interior decorator" as per Section 69 of the Finance Act, 1994. The show cause notice invoked the extended period due to non-payment of service tax liability. Both the adjudicating and first appellate authorities confirmed the appellant's liability for service tax, interest, and penalties.

2. The appellant argued that their activities did not fit under "Interior decorator services" but rather under "Erection, Commissioning, or Installation Services." They cited precedents where similar activities were not categorized as "Interior Decorator." The Department contended that the appellant indirectly provided technical assistance related to interior beautification, making them liable for service tax under the "Interior decorator" category.

3. The Tribunal considered that the appellant manufactured furniture as per client specifications, undertook modular partition work, and executed activities under subcontractors' supervision. The Tribunal analyzed the definition of "Interior Decorators" under Section 65(59) of the Finance Act, 1994, which includes services related to planning, design, or beautification of spaces. The Tribunal found that the appellant's activities did not fall under this definition but aligned more with services like commissioning or installation.

4. Referring to previous Tribunal decisions, the Tribunal concluded that the appellant's activities were related to planning, designing, and beautification of space, falling outside the scope of "Interior decorator services." The Tribunal set aside the impugned order, allowing the appeal with consequential relief. The judgment clarified that the appellant's activities were not liable for service tax under the "Interior decorator" category, aligning with the precedents and legal interpretations presented during the proceedings.