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TMI Blog2012 (6) TMI 301X X X X Extracts X X X X X X X X Extracts X X X X ..... collection of toll charges. Therefore, if NHAI engages somebody else to collect toll charges on its behalf and pays them remuneration, the service so rendered would appear to merit classification under 'Business Auxiliary Service'. appellant directed to make a pre-deposit - ST/85 OF 2010 - S/383/11/CSTB/C-I - Dated:- 9-9-2011 - ASHOK JINDAL, P.R. CHANDRASEKHARAN, JJ. ORDER P.R. Chandrasekharan, Technical Member - This appeal and stay application are filed against the Order-in-Original No. 46/BR-42/ST/Th-I/2009 dated 19/11/2009 passed by the Commissioner of Central Excise, Thane -I Commissionerate. 2. The facts arising for consideration in this case are briefly as follows: 2.1 The appellant M/s. Ideal Road Builders ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, 1994. 2.3 The case was adjudicated by the impugned order wherein the adjudicating authority held that the appellant M/s. IRBPL was liable to pay Rs. 96,36,209/- towards service tax for the period from 01/07/2003 to 31/07/2007 under the category of 'Business Auxiliary Services' under Section 73 of the Finance Act, 1994. The learned Commissioner further held that the appellant was liable to pay interest on the delayed payment of service tax at the appropriate rate under Section 75 of the Finance Act, 1994. The adjudicating authority further imposed a penalty on the appellant equal to the amount of service tax under Section 78 of the Act and a further penalty @ Rs. 200/- per day from the due date of payment to the actual date of payment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... operty services. He also relied on the judgment of this Tribunal in the case of Banas Sands TTCP Ltd. v. CCE [Appeal No. ST/392 (CESTAT - Delhi) of 2010 dated 14-2-2011] wherein it was held that collection of toll taxes on behalf of Municipal Corporation of Delhi on the entry of commercial vehicles in the State of Delhi is a sovereign function and cannot be terms as 'Business Auxiliary Service'. In the light of these submissions the learned counsel submits that they have a very strong case on merits and prays for stay of the impugned order and recovery of dues adjudged pending final hearing and decision on their appeal. 4. Learned Commissioner (AR) appearing on behalf of the Revenue on the other hand submits that NHAI is only a statutory ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ernment in this behalf, it shall be the function of the Authority to develop, maintain and manage the national highways and any other highways vested in, or entrusted to, it by the Government. (2) Without prejudice to the generality of the provisions contained in sub-section (1), the Authority may, for the discharge of its functions (a) survey, develop, maintain and manage highways vested in, or entrusted to, it; (b) construct offices or workshops and establish and maintain hotels, motels, restaurants and rest-rooms at or near the highways vested in, or entrusted to, it; (c) construct residential buildings and townships for its employees; (d) regulate and control the plying of vehicles on the highways vested in, or entrusted to, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uthority is a statutory authority and collects fees on behalf of the Government of India for the services or benefits rendered at the rates specified by the Government. 5.1 Further, Section 10 of the Act specify that: "In the discharge of its functions under this Act, the Authority shall act, so far as may be, on business principles." 5.2 Thus, it would appear that M/s. NHAI is only a statutory authority and not a constitutional authority. Therefore, the functions undertaken by such authority cannot be sovereign in nature. Sovereign functions are undertaken by the State and its organs and the powers that can be exercised by the State and its organs are defined in the Constitution. To equate the toll fee collected by the NHAI with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d allowances and other remunerations provided to its members, officers or other employees, etc. In view, of the distinctive nature of the functions and the amounts collected, prima facie we are of the view that the functions performed by NHAI or its contractor cannot be considered as sovereign functions nor the fees collected acquires the nature of tax or duty so as to be outside the scope of service tax. As noted already, NHAI is supposed to work on business principles and therefore it cannot be stated that it does not perform business activities. Its business is development, maintenance and management of national highways. Any service rendered in relation there to would appear to merit classification under 'Business Auxiliary Services'. P ..... X X X X Extracts X X X X X X X X Extracts X X X X
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