2019 (12) TMI 393 - AT - Service Tax

Classification of services - service of Supply Of Tangible Goods for use or not - appellant are providing Cylinder to their subsidiaries on rating basis - HELD THAT - Under the same set of fact and on the legal issue, this tribunal has decided the matter in the appellant s own case AIMS PHARMA PVT LTD VERSUS C.C.E. S.T. -VADODARA-I 2019 (5) TMI 240 - CESTAT AHMEDABAD where it was held that supply of tangible goods on lease basis with transfer of right to possession and effective control will go out of ambit of taxable services. Moreover this transaction is undisputedly liable to VAT as the appellant are paying the VAT as per the provision of the State Government VAT Act. Thus, the services would not fall under the category of tangible goods for use . It is also observed that in the present case the show cause notice is only in the form of statement to the earlier show cause notice which was covered in the cited judgment, therefore, the absolutely identical issue for the earlier period has been decided, accordingly, the issue is no longer Res-Integra. Appeal allowed - decided in favor of appellant.

Summary

Issues involved:
- Whether the transaction of providing cylinders to subsidiaries on a rating basis constitutes "Supply Of Tangible Goods for use" under Section 65 (105)(zzzzj) of the Finance Act, 1994.

Analysis:

The judgment by the Appellate Tribunal CESTAT AHMEDABAD, delivered by Hon'ble Member (Judicial) Mr. Ramesh Nair and Hon'ble Member (Technical) Mr. Raju, dealt with the issue of whether the appellant's provision of cylinders to their subsidiaries on a rating basis falls under the category of "Supply Of Tangible Goods for use" as per Section 65 (105)(zzzzj) of the Finance Act, 1994. The department contended that the transaction should be classified as such, leading to a demand being confirmed. However, the appellant argued that a previous decision by the Tribunal in Aims Pharma Pvt Ltd vs. C.C.E. & S.T.-Vadodara-I-2019 had ruled in their favor on a similar issue for an earlier period.

During the proceedings, the appellant's counsel, Ms. Vanashri Kalbhor, highlighted the previous favorable ruling by the Tribunal in a similar case involving the appellant. The authorized representative for the Revenue, Shri. Dharmendra Kanjani, reiterated the stance taken in the impugned order. Upon hearing both sides and examining the records, the Tribunal noted that the issue at hand was identical to the one previously decided in the appellant's favor. The show cause notice for the current case was akin to the one covered in the earlier judgment, rendering the issue no longer Res-Integra.

Relying on the precedent set by its earlier decision in the appellant's own case, dated 02.05.2019, the Tribunal set aside the impugned order and allowed the appeal. By following the same legal reasoning and factual background as in the previous judgment, the Tribunal concluded that the issue had already been decisively settled in favor of the appellant, making the current dispute non-justiciable.