2018 (8) TMI 489 - AT - Service Tax

Levy of Service Tax - Management, maintenance and repair Service - It is the case of the Revenue that the Respondent-Assessee are providing repair and maintenance of road services and were not showing the service and value thereof in the ST-3 Returns submitted by them - Held that - The Finance Act, 1994, has been amended by introducing Section 97(1) wherein special exemption has been granted for management, maintenance and repair of roads for the period from 16.06.2005 to 26.07.2009 (both days inclusive) - In the present case, the period is subsequent to 16.06.2005, when the entries of for management, maintenance and repair of roads, came into existence. Appeal dismissed - decided against Revenue.

Summary

Issues:
- Whether service tax is leviable on services by way of relaying, repairing, and maintenance of roads during a specific period.
- Whether repair and maintenance services of roads are excluded from the levy of service tax under certain sections of the Finance Act, 1994.
- Whether the exemption provided under Section 97(1) of the Finance Act, 1994 applies to the case at hand.

Analysis:
1. Levying of Service Tax on Road Services: The Revenue alleged non-payment of service tax by the Respondent-Assessee for providing repair and maintenance services of roads within a steel plant premises. The Adjudicating Authority confirmed the demand of service tax along with penalties. The ld. Commissioner (Appeals) allowed the appeal, leading to the Revenue's appeal before the Tribunal.

2. Contentions of the Parties: The Revenue argued that since the steel plant engages in commercial activities, services provided within its premises are not for public utility but commercial purposes, making them liable for service tax. The Respondent- Assessee contended that repair and maintenance of roads are excluded from the levy of service tax under specific sections of the Finance Act, 1994.

3. Exemption under Section 97(1) of the Finance Act: The Respondent's Advocate highlighted Section 97(1) inserted by the Finance Act, 2012, providing an exemption from service tax on management, maintenance, and repair of roads during a specific period. The Advocate argued that repair and maintenance services of roads fall under exclusions from works contract services, making them non-taxable under the general category of management, maintenance, or repair services.

4. Tribunal's Decision: The Tribunal noted the existence of various decisions by High Courts and Tribunals on the issue. Referring to Section 97(1) of the Finance Act, the Tribunal found that a special exemption was granted for management, maintenance, and repair of roads during a specific period, which covered the services provided by the Respondent. As the ld. Commissioner (Appeals) had already addressed the issue in detail, finding no issues with the impugned order, the Tribunal dismissed the Revenue's appeal.

In conclusion, the Tribunal upheld the exemption provided under Section 97(1) of the Finance Act, 1994, and dismissed the Revenue's appeal, affirming the decision of the ld. Commissioner (Appeals).