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TMI Blog2016 (12) TMI 289X X X X Extracts X X X X X X X X Extracts X X X X ..... ight of the CBEC circular also, there can be no levy of service tax on such activities carried out by the police department. In line with the above discussions, the appeals filed by the police department succeed - appeal allowed - decided in favor of Department. - ST/3694/2012 - Final Order Nos. 55321-55348 - Dated:- 25-11-2016 - Ms. Archana Wadhwa, Member (Judicial) And Mr. V. Padmanabhan, Member (Technical) ST/3760/2012, ST/55448/2013 ST/59142/2013 ST/59330/2013 ST/59331/2013 ST/60445/2013 ST/50656/2014 ST/50845/2014 ST/50944/2014 ST/50945/2014 ST/50973/2014 ST/51046/2014 ST/51804/2014 ST/52621/2014 ST/52622/2014 ST/52994/2014 ST/53308/2014 ST/53923/2014 ST/53924/2014 ST/53925/2014 ST/50360/2016 ST/50517/2016 ST/51746/2016 ST/51782/2016 ST/51928/2016 ST/52610/2016 ST/52611/2016 Mr. Rahul Lakhwani, CA Mr. Mayank Garg, Advocate Mr. Sanjay Tiwari, CA Ms. Renu Gupta, Advoate Mr. Vijay Kumar, Advocate Mr. RM Yadav, Advocate For Appellant Mr. Govind Dixit, DR For Respondent ORDER Per Mr V. Padmanabhan The present batch of appeals have been filed against various orders passed by the lower authorities challenging the demands for service tax confirmed agai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to public at large, was providing Security Agency Services in relation to property as well as personal security for a consideration. The Central Board of Excise and Customs, New Delhi has also clarified the issue of taxability in respect of services provided by public authorities vide Circular No.89/7/2006-ST dated 18.12.2006 that: Activities assigned to and performed by the sovereign / public authorities under the provisions of any law are statutory duties. The fee or amount collected as per the provisions of the relevant statute for performing such functions is in the nature of compulsory levy and are deposited in the Govt. Account. However, if a sovereign or public authority provides a service, which is not in the nature of statutory activity and the same is undertaken for consideration (not a statutory fee), then in such cases service tax would be leviable as long as the activity undertaken falls within the scope of a taxable service as defined. (iii) Accordingly Show Cause Notices were issued by various jurisdictional Service Tax authorities for recovery of Service Tax on the charges recovered by Police under proviso to Section 73(1) of the Finance Act, 1994 along with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A (b) Mr. Mayank Garg, Advocate (c) Mr. Sanjay Tiwari, CA (d) Ms. Renu Gupta, Advoate (e) Mr. Vijay Kumar, Advocate (f) Mr. RM Yadav, Advocate 5. The following case laws were relied upon by the ld. Counsels for the appellants:- (a) Mumbai Police Vs. CST, Mumbai [2015 (37) sTR 483 (Tri.-Mumb)] (b) Security Guards Board Vs. CCE, Thane-II [2011 (24) STR 391 (Bom.)] (c) DCP Vs. CCE, Jaipur-II [ 3024 (31) STR 228 (Tri.-Del.)] (d) State of West Bengal Vs. Union of India [AIR 1963 SC 1241] (e) Maharashtra Industrial Development Corporation Vs. CCE, Nasik [2014 (36) STR 1291 (Tri.-Mumb)] (f) The State of Uttar Pradesh Vs. Mohammad Naim [AIR 1964 SC 703] (g) State of Bihar anr. Vs. JAC Saldanha Ors [AIR 1980 SC 326] (h) Punjab Ex-servicemen Corporation Vs. CCE, Chandigarh [2009 (13) STR 529 (Tri.-Del.)] (i) Surat Municipal Corporation Vs. CCE, Surat [2006 (4) STR 44 (Tri.-Del.)]. 6. Revenue was represented by Shri Govind Dixit, ld. Departmental Representative and he reiterated the views of the authorities below. His submission is that with effect from 01.05.2006, the definition of Security Agency Service under section 65(94) of the Act has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... son, in any manner and includes the services of investigation, detection or verification, of any fact or activity, whether of a personal nature or otherwise, including the services of providing security personnel. 9. The other relevant circular issued by CBEC is circular No. 89/7/2006-ST dated 18.12.2006 is reproduced below: The activities assigned to and performed by the sovereign / public authorities under the provisions of any law are statutory duties. The fee or amount collected as per the provisions of the relevant statute for performing such functions is in the nature of compulsory levy and are deposited in the Govt. Account. However, if a sovereign or public authority provides a service , which is not in the nature of statutory activity and the same is undertaken for consideration (not a statutory fee), then in such cases service tax would be leviable as long as the activity undertaken falls within the scope of a taxable se4rvice as defined. 10. The appellants have argued that the term person appearing in the definition must be construed to be a natural person as well as a juristic person and by no stretch of imagination, the same will include the State or its o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is to be presumed to be in the nature of business. The term business connotes that it is an activity undertaken with the intent of earning profit. The charges recovered by Police are in the nature of cost recovery for the additional police force deployed on request for maintaining security and law and order. It is also the submission of the police department that the deputation of additional police force at the request of banks and other institutions or other events has been done only for maintenance of law and in the absence thereof there could arise major security issues in relation to person or property. In the light of the submissions made, we are of the view that the activities undertaken by the police, for which charges have been recovered, cannot be held to be in the nature of business activity. 12. Now, we turn to the CBEC circular No.89/7/2006-ST, dated 18.12.2006. The circular has indicated under what conditions an activity performed by a sovereign/public authority should be categorized as one which is liable to payment of service tax. The circular clarifies that charges recovered by any sovereign/public authority for carrying out any statutory function will not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce for security purposes. In the notification number dated 19.5.2008, the charges fixed per day are as follows: 1 Constable ₹ 250 per day. 2 Head constable ₹ 300 per day With this it is wide and clear that the user charges are in the nature of amount collected as per the provision of the relevant law. (iii) The amount collected is to be deposited into Government treasury. As per the requirement of the General Finance Account Rules issued by the Rajasthan State Government, the Government dues are to be collected and paid into the Government treasury. The Appellant, therefore, is required to collect the usage charges and credit the same in the Rajasthan State Government treasury. The submission made by the police department in this regard is that the fees recovered by them is for provision of additional police force. They have referred to Section 46 of the Rajasthan Police Act, 2007 and submitted that the additional police officers are deployed at the request of any person only for the purpose of public secur ..... X X X X Extracts X X X X X X X X Extracts X X X X
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