2019 (1) TMI 65 - AT - Service Tax

Works Contract service or not - appellant herein was rendering Maintenance or Repair of ships to various clients - period involved is from 16.06.2005 to 31.12.2009 - principles of natural justice - Held that - The Bench enquired with the Learned Chartered Accountant as to agreement or work orders is enclosed, he submits that they have not enclosed any agreements. The argument as to whether the services rendered by the appellant would fall under the category of works contract services or otherwise is a question that needs to be addressed by the lower authorities in light of the judgment of the Apex Court in the case of Larsen & Toubro Ltd., 2015 (8) TMI 749 - SUPREME COURT by looking at the agreement or orders etc. - this specific point also not elaborated in the manner by the appellant s counsel before the Adjudicating Authority. The impugned order is set aside and both the appeals are remitted to Adjudicating Authority to reconsider the issue afresh after following principles of natural justice - appeal allowed by way of remand.

Summary

Issues:
1. Improper availing of abatement on services provided.
2. Nature of services provided: works contract services or otherwise.
3. Compliance with principles of natural justice.

Analysis:
1. The judgment involves two appeals directed against the same impugned order related to the appellant's alleged improper availing of abatement on the value of Maintenance or Repair services provided to various clients. The Adjudicating Authority confirmed demands raised along with interest and penalties, concluding that there was an improper availment of notional abatement and wrongly demanded some amount.

2. The crucial issue in question pertains to whether the services rendered by the appellant to clients qualify as works contract services or fall under a different category. The period under consideration is from 16.06.2005 to 31.12.2009. The appellant's counsel argued that the services were for repairs or maintenance of ships in ports, but failed to provide agreements or work orders for clarification. The Tribunal emphasized the need for lower authorities to address this question in light of relevant case law, highlighting the importance of examining agreements or orders to determine the nature of services provided.

3. The Tribunal, without expressing any opinion on the case's merits, set aside the impugned order and remitted both appeals to the Adjudicating Authority for reconsideration. It emphasized the importance of adhering to principles of natural justice in the reconsideration process. Additionally, the Adjudicating Authority was directed to aim for a timely disposition of the matter within three months from the receipt of the Tribunal's order, emphasizing the need for expeditious resolution of the issue at hand.