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TMI BlogNo service tax on services rendered to NHAI being not a business auxiliary serviceX X X X Extracts X X X X X X X X Extracts X X X X ..... No service tax on services rendered to NHAI being not a business auxiliary service X X X X Extracts X X X X X X X X Extracts X X X X ..... NHAI") on the ground that the same is taxable under Business Auxiliary Service ("BAS") and held that the assessee was not rendering BAS services as alleged. Facts: M/s. PNC Infratech Ltd. ("the Appellant") entered into a short-term improvement and routine maintenance contract with NHAI on June 13, 2003. A show cause notice dated May 23, 2008 ("the SCN") was issued to the Appellant stating that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Appellant had undertaken the toll operation services which amounted to business auxiliary service under Section 65(19) of the Finance Act, 1994 ("the Finance Act") and thus the consideration received against tolling operations was liable to service tax for the period July 01, 2003 to March 31, 2006. The Appellant had filed a reply to the SCN submitting that the services rendered by the Appell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant to NHAI are not liable to service tax under business auxiliary service. The Adjudicating Authority passed an order dated October 01, 2008 ("the OIO") confirming the demand of service tax along with interest and penalty. Aggrieved by the OIO, the Appellant filed an appeal before Commissioner (Appeals) who vide an order dated May 02, 2011 ("the Impugned order") confirmed the demand raised by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Adjudicating Authority. Aggrieved by the Impugned Order, the Appellant filed an appeal before the CESTAT. Issue: Whether the toll operation services rendered by the Appellant to NHAI is taxable under business auxiliary services? Held: The CESTAT, Chandigarh, in in PNC INFRATECH LTD. (FORMERLY KNOWN AS PNC CONSTRUCTION CO. LTD.) VERSUS CCE- LUDHIANA - 2023 (7) TMI 258 - CESTAT CHANDIGARH he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld as under: * Noted that, the Appellant entered into a composite contract for undertaking various activities like road maintenance, road property management, incident management engineering improvements and toll operations and a composite contract cannot be vivisected and part of it i.e., tolling operations alone cannot be subject to service tax. * Relied upon the judgement of the Appellant o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wn past case [COMMR. OF SERVICE TAX, DELHI VERSUS INTERTOLL ICS CE CONS O & MP. LTD. - 2013 (12) TMI 731 - CESTAT NEW DELHI] wherein the CESTAT held that NHAI has availed the services of assessee and the NHAI is not established by Revenue to be business concern or a commercial concern engaged in any business activities. Therefore, providing BAS to such NHAI is not conceivable. Accordingly, appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filed by the Revenue was dismissed.
* Following the ratio in the above-mentioned case, the court held that the impugned order is not sustainable in law and is liable to be set-aside by allowing the appeal of the Appellant with consequential relief, if any.
(Author can be reached at [email protected]) X X X X Extracts X X X X X X X X Extracts X X X X
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