9911796707
TMI Blog2008 (12) TMI 135X X X X Extracts X X X X X X X X Extracts X X X X ..... 30th December 2005. Commissioner (Appeals) reduced the penalty to Rs. 5,000.00. Assessee filed appeal No. ST/345 of 2006 against the said order-in-appeal. Revenue filed appeal No. ST/128 of 2006 for imposition of penalty of equal amount. 3. Another demand of tax of Rs. 5,98,000.00 (Rupees Five Lakh Ninety Eight Thousand only) and penalty of Rs. 25,000.00 (Rupees Twenty Five Thousand only) under Section 76 vide order-in-original dated 27th January 2005. Assessee filed appeal before the Commissioner (Appeals), which was rejected. The assessee filed appeal No. ST/346 of 2006 against the said order-in-appeal. In the meantime, Commissioner of Central Excise revised the Order-in-original dated 27th January 2005 and enhanced the penalty to Rs. 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct) involves the element of both sale and service contract and that the service and sale elements can be split up. That being so, we do not find any merit in the submission of the Revenue that the decision in BSNL case cannot be treated as an authority on the issue of service tax. If the photography service is a 'works contract', it would follow that it involves the element of both sale and service, and the sale portion of the activity or transaction cannot be included in the taxable value of service. There cannot be any doubt, in view of sub-clause (b) of clause (29-A) of Article 366, that deemed sale of the materials takes place in the rendering of photography service and, therefore, the value of the materials cannot be included while com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase, the matter has to be reconsidered de novo by the authorities below. 17. One issue which we may deal with relates to limitation. According to the appellant, the impugned demands have been confirmed invoking the extended period of limitation, but as the appellants did not commit any fraudulent act nor suppressed any information from the Department much less with intention to evade the service tax, the non-payment, if any, by reason of non-inclusion of the value of the sale portion of the contract, that is, the non-disclosure of the gross total amount including the value of the materials, was on account of bona fide belief that service tax liability relates to the service part of the contract which has already been discharged by the appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lue relating to photography materials would not be included in the levy of service tax. It is a case of interpretation of the statutes and, therefore, extended period of limitation and imposition of penalties would not warrant. As such, we direct the Adjudicating Authority to re-determine the quantum of tax for normal period of limitation following the decision of the Tribunal in the case of Deluxe Colour Lab Pvt. Ltd. (supra). Penalties are set aside. Appeal No. ST-128/07 filed by Revenue is rejected. Revised order passed by the Commissioner is set aside and appeal No. ST-137/07 is allowed with consequential relief. The other appeals filed by the assessee are disposed of in the above terms.
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