2023 (3) TMI 1128 - AT - Service Tax

Levy of Service tax - Industrial or Commercial Construction Service - service of industrial painting job - scope of SCN - HELD THAT - The learned Commissioner (Appeals) travelling beyond the show cause notice and adjudication order decided that the service tax is payable under the head of Management, maintenance and repair service. This approach of the learned Commissioner (Appeals) is absolutely illegal and incorrect. The learned Commissioner (Appeals) has no power to create a new case before him which is not flowing from the show cause notice therefore, on this ground alone the impugned order is not sustainable. However, since the learned Commissioner (Appeals) has upheld the demand under Management, maintenance and repair service and not under Industrial or Commercial Construction Service the matter needs to be reconsidered by the learned Commissioner (Appeals). The learned Commissioner (Appeals) shall decide the appeal considering the service under Industrial or Commercial Construction Service. Accordingly, the impugned order is set aside - Appeal is allowed by way of remand to the Commissioner (Appeals) for passing afresh Order-in-Appeal preferably within a period of two months from the date of this order.

Summary

Issues involved:
The issue involved in this case is the classification of service for the purpose of levy of service tax, specifically whether the service provided falls under 'Industrial or Commercial Construction Service' or 'Management, maintenance and repair service'.

Classification of service - Industrial or Commercial Construction Service vs. Management, maintenance and repair service:
The appellant was engaged in providing painting services in the industrial sector, which was considered to fall under the category of 'Industrial or Commercial Construction Service' for the purpose of service tax levy. A show cause notice was issued demanding service tax under this category. However, the Commissioner (Appeals) held that the service tax is payable under 'Management, maintenance and repair service', which was not the classification proposed in the show cause notice. The Tribunal found this decision to be incorrect and illegal, emphasizing that the Commissioner (Appeals) cannot create a new case beyond the scope of the show cause notice. The matter was remanded back to the Commissioner (Appeals) to reconsider the appeal under the correct classification of 'Industrial or Commercial Construction Service'.

Conclusion:
The Tribunal set aside the impugned order and allowed the appeal by way of remand to the Commissioner (Appeals) for a fresh decision within a specified timeframe. The judgment highlighted the importance of adhering to the classification mentioned in the show cause notice and the adjudication order, emphasizing the need for consistency in determining the applicable service tax category.