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TMI Blog2021 (7) TMI 195X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant. - SERVICE TAX APPEAL NO. 52122 OF 2016 - Final Order No. 51599/2021 - Dated:- 17-6-2021 - MR. ANIL CHOUDHARY, MEMBER (JUDICIAL) AND MR. P.V. SUBBA RAO, MEMBER (TECHNICAL) Shri Rahul Lakhwani, Advocate for the Appellant Shri Radhe Tallo, Authorized Representative for the Respondent ORDER This appeal is filed against Order-in-Original No. JAI-EXCUS-002-COM-28-14-15 dated 12.12.2014. 2. The facts of the case are that the appellant is Commandant of Home Guards in the State of Rajasthan created under the Rajasthan Home Guards Act, 1963 for bridging the requirement of reserved police force required to maintain public safety, protection of persons and property and maintenance of law and order. The Home Guards department is a part of Ministry of Home Affairs, Government of Rajasthan and are called out by the Police Department for maintenance of law and order. The appellant also provides security to various Government departments and firms and charges some amounts. Revenue was of the opinion that this provision for providing the security and collection of a consideration amounts to rendering security agency service as per Section 65(105)(w) of the Fina ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of Police, Jodhpur Vs. Commissioner of Central Excise Service Tax And Ors., Jaipur-II - (2017 (48) STR 275 (Tri.-Del.). Revenue s appeal against this order was dismissed by the Hon ble Supreme Court in Civil Appeal Diary No. 24355 of 2017 as reported in 2018 (11) GSTL J133 (SC). 6. The learned Departmental Representative supports the impugned order. 7. We have considered the arguments in both sides and perused the records. 8. It is a common practice for various police organizations to provide security to others and charge a fee for it. The question is whether this amounts to providing a security agency service or otherwise. As rightly pointed out by the learned Counsel for the appellant that the term person appearing in the definition must be construed to be a natural person and by no stretch of imagination will include the State or its officers or the posts created under a statute as held by the Constitution Bench of the Hon ble Supreme Court in the case of West Bengal Vs. Union of India - [AIR 1963 SC 124]. Since State cannot be a person, it cannot be a security agency . Therefore, no service tax under the head security agency service can be charged on the amou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... posts created under a statute. They cited the judgment of the Constitution Bench of the Hon'ble Supreme Court in the case of West Bengal v. Union of India [AIR 1963 SC 124] in which the Apex Court has held as under :- the definition is an enlargement of the natural meaning of the expression person , even the extended meaning does not include the State. Their submission is that Superintendent of Police is an authority of the State Govt. to carry out statutory and constitutional duties. The definition of the term person , (which does not cover the Govt.) in the General Clauses Act, 1897 is given as follows :- 42. Person shall include any company or association or body of individuals, whether incorporated or not, . In the light of the definition of the term person in the General Clauses Act, 1897, which has also been examined and clarified by the Apex Court, it would appear that the Superintendent of Police, which is an agency of the State Govt. does not appear to be covered within the term person . It is also noteworthy that in the year 2012 when the pattern of levy of service tax was changed and the concept of negative list was introduced with effect from 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... function will not be liable for levy of service tax if all the following conditions are satisfied :- (a) Sovereign/public authorities perform duties which are in the nature of statutory and mandatory obligation to be fulfilled in accordance with the law. (b) The fee collected should be levied as per the provision of relevant law. (c) The amount collected is to be deposited into Government treasury. The satisfaction of each of the above three conditions is analysed below :- (i) A sovereign/public authority performs duties which are in the nature of statutory and mandatory obligation to be fulfilled in accordance with law. The Superintendent of Police is an extended arm/instrumentality/ agency of the State Government and is controlled and managed by the State Government. It is carrying out the activities as entrusted to it vide the Police Act which are statutory and constitutional in nature. The appellant is required to discharge these statutory obligations for public security and maintenance of public peace and order. The appellant cannot carry out any activity beyond the legislative competence. The user charges are levied by the State Government for the deploymen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the maintenance of public peace or order. The fees levied and collected for this purpose is strictly as per the notification issued by the State Govt. under the above Section of the Act. The amounts so collected are mandatorily deposited into the Govt. treasury. Accordingly, they have submitted that all the conditions stipulated by the C.B.E. C. circular are satisfied and consequently the activities are to be considered as statutory function and no service tax can be levied on such fees collected for discharging the sovereign function. The lower authorities have, however, taken the view that the activity undertaken is not in the nature of statutory duty, but an activity undertaken for a consideration which is not a statutory fee. We find ourselves unable to agree to this stand taken by the lower authorities. The police department has the mandatory duty to maintain public peace and order. For such duty, which is in the nature of sovereign function, no charges are recoverable from the citizens. In the present case, the police department has recovered fees for deploying additional police personnel on request. However, the statutory functions of the police of the State Govt. make ..... X X X X Extracts X X X X X X X X Extracts X X X X
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