2018 (11) TMI 1090 - AT - Service Tax

Demand of Service Tax - Outdoor Catering Services - Cleaning Services - Held that - The respondent has supplied only qualified cooking supervisory staff etc., to M/s. BHEL. It is not coming out from the records or the agreement that the respondent had supplied any food/eatables to the premises of M/s. BHEL. By merely supplying the necessary staff for running a canteen, it may not be stated that the respondent had rendered any Outdoor Catering Service - the demand proposed in the SCN under Outdoor Catering Service and Cleaning Services cannot sustain - appeal dismissed - decided against Revenue.

Summary

Issues:
Interpretation of whether the services provided by the respondent fall under Outdoor Catering Services or Man-power Supply Services.

Analysis:
The case involved a dispute regarding the classification of services provided by a co-operative society to M/s. BHEL. The department alleged that the services rendered by the respondent constituted Outdoor Catering Services and issued a show-cause notice demanding service tax for a specific period. The original authority confirmed the demand, interest, and penalties, but the Commissioner (Appeals) set aside the demand, ruling that the services did not fall under Outdoor Catering Services or Cleaning Services.

During the appeal before the Tribunal, the department argued that the respondent's activities should be categorized as Outdoor Catering Services since they provided catering services at a location other than their own, as per the agreement with M/s. BHEL. The department contended that the food items were prepared by the respondent on the company's premises as per mutual agreement, falling within the definition of Outdoor Catering as per the Finance Act, 1994. They criticized the Commissioner (Appeals) for relying on a previous decision that they deemed irrelevant.

On the other hand, the respondent's representative argued that the agreement only required them to supply qualified cooking supervisors and laborers, while M/s. BHEL provided the necessary provisions for food preparation. The respondent did not supply any food or edible items at M/s. BHEL's premises. They maintained that the services provided should be classified as Man-power Supply Services and not as Outdoor Catering Services or Cleaning Services. The original authority's decision to confirm the demand under Outdoor Catering Service was challenged, and the Commissioner (Appeals) was supported for setting aside the demand.

After considering the arguments from both sides and reviewing the records and agreement, the Tribunal found that the respondent had only supplied qualified staff to M/s. BHEL without providing any food or eatables at the company's premises. The Tribunal distinguished the case cited by the department, where the assessee did supply food and eatables. Consequently, the Tribunal concluded that the demand for service tax under Outdoor Catering Service and Cleaning Services was not sustainable. The decision of the Commissioner (Appeals) to set aside the demand was upheld, and the appeal was dismissed.

In conclusion, the Tribunal's judgment clarified the distinction between Outdoor Catering Services and Man-power Supply Services based on the specific activities and agreements involved in this case, ultimately ruling in favor of the respondent and dismissing the appeal.