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TMI Blog2009 (2) TMI 127X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 OF 2007 - 71 OF 2009 - Dated:- 2-2-2009 - T.K. JAYARAMAN, TECHNICAL MEMBER AND M.V. RAVINDRAN, JUDICIAL MEMBER Varadarajan for the Appellant. Ms. Sudha Koka for the Respondent. ORDER M.V. Ravindran, Judicial Member - This appeal is directed against the Order-in-Original No. 20/2006, dated 4-1-2007. 2. The relevant facts in brief that arise for consideration are the appellants herein are registered with the department as a service tax assessee in the category of services of "Commercial Construction Services" on 1-10-2004. Based upon some intelligence and investigations conducted by the authorities, the authorities came to the conclusion that the appellants had not included the value of Piling works undertaken by them for the construction of new Commercial and Industrial Construction Works as well as the Residential Complexes in the taxable value for the purpose of assessment and discharge of service tax liability. It was also noticed by the authorities that the services rendered by the appellant for soil testing and survey work would fall under the category of "Consulting Engineer Services" and the amount collected by the appellant for such services has escap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to 31-12-2005 should not be demanded from them under section 73 of the Finance Act, 1994. (ix) Interest at the appropriate rate on the service tax payable but not paid as detailed in Annexure A should not be demanded from them under section 75 of the Finance Act, 1994 and (x) Penalty should not be imposed on them under section 76 of the Finance Act, 1994 for their failure to comply with the provisions of section 68 read with rule 6 of Service Tax Rules, 1994 as detailed in this show-cause notice. (xi) Penalty should not be imposed on them under section 77 of Finance Act, 1994 for their failure to file returns under section 70 of the Finance Act, 1994 read with rule 7 of Service Tax Rules, 1994. (xii) Penalty should not be imposed on them under section 78 of Finance Act, 1994, for wilfully suppressing the value of Taxable Service with an intent to evade payment of service tax. 3. The appellant contested the show-cause notice on various "grounds namely on the ground that the Soil Testing and Survey Work does not fall under the category of Consulting Engineer and that the demand of the duty for piling works during the period 10-9-2004 to 18-4-2005 is time barred. The Adju ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... education cess payable by them during the period from 1-10-2000 to 31-12-2005 under the provisions of section 73 of the Finance Act, 1994, as against the demand of Rs. 4,47,418 raised in the show-cause notice under disposal. (v) I find that the assessee has already paid an amount of Rs. 27,97,676 towards service tax against the total demand now confirmed as above, amounting to Rs. 50,28,853 and the said amount of Rs. 27,97,676 (Rupees twenty seven lakhs ninety seven thousand six hundred and seventy six only) is ordered to be appropriated against the total amount of tax due from them, under the provisions of section 73 of the Finance Act, 1994. (vi) I order that interest at the appropriate rate shall be paid by the assessee under section 75 of the said Act in respect of the amount short-paid. (vii) I also impose a penalty calculated @ Rs. 100 (Rupees one hundred only) every day during which the failure to pay the tax continued, as per provisions under section 76 ibid. (viii) I impose a penalty of Rs.1,000 (Rupees one thousand only) under section 77 of the said Act for violation of the provisions of section 70 ibid. (ix) I further impose a penalty of Rs. 50,28,853 (Rupees f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rged. It is his submission that the computation of tax, if any, is to be considered based upon the amount which is received and cannot contain the amount which is not received. He relies upon the decision of the Tribunal in the case of Dr. Lal Path Lab (P.) Ltd. v. CCE [2006] 5 STT 171 (New Delhi-CESTAT), Firepro Systems (P.) Ltd. v. CST [Stay Order No. 848 (Bang.) of 2007, dated 2-11-2007], Glaxo Smithkline Pharmaceuticals Ltd. v. CCE [2005] 1 STT 37 (Mum.-CESTAT), Multi Mantech International (P.) Ltd. v. CST [2009] 18 STT 229 (Ahd.-CESTAT). 5. Learned SDR on the other hand, would submit that the activities under-taken by the appellant as regards the soil testing during the period is not disputed by them. It is her submission that the definition of Consulting Engineer will cover the activities of Soil Testing and Survey Work etc. She would bring to our notice that the Order-in-Original at paragraph 25 has clearly examined the fact that the appellants had never produced invoices etc. with the authorities, so that they could arrive at the correct assessments. It is her submission that the Adjudicating Authority has in paragraph 25 of Order- in-Original given the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of doing services of piling work with the authorities on 29-11-2004. Having got registered from 29-11-2004, it was the duty of the appellant to discharge the service tax liability on the services rendered by them at least for the period subsequent to registration. It is also seen from the records that the appellants have not discharged their service tax liability on the piling work for the Commercial buildings from 10-9-2004 to 31-12-2005. The reasons given by the appellant for not discharging the service tax seems to be very trivial. The fact that the appellants have themselves registered under the category of service provider on 29-11-2004, should have gone to the authorities and asked for the further action to be undertaken by them as regards the discharge of service tax liability etc. We find that the Adjudicating Authority in the Order-in-Original has given the benefit of many of the value which the appellant claimed, before arriving at the service tax liability on this ground. We do not accept the claim of the appellant that the service tax liability for the period 10-9-2004 to 19-4-2005 is time barred, as it was for the appellant to discharge the service tax liability f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... avation and earthmoving and demolition", "survey and map making other than Government departments". If that be so, the next question arises whether these services can be brought into the net of services under the Consulting Engineer Services period prior to 16-6-2005. We find that the Adjudicating Authority in the Order-in-Original has come to the conclusion that these services would fall under the category of Consulting Engineer Services on the ground that these activities are preliminary/preparatory activities for boring and drilling etc. In this area of activity no separation of work element and service element is possible and nor is required. It was upheld by the Adjudicating Authority it is a composite activity where the predominance is providing of advice, in relation to foundation engineering. The Adjudicating Authority also arrived at the conclusion on the ground that the appellants themselves have referred as Foundation Engineering Consultants. Based upon these conclusions, the Adjudicating Authority came to the conclusion that soil testing and survey work under taken by the appellant would fall under Consulting Engineer Services. We are unable to agree to this reasoning g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o not come within the definition is required be upheld. The ratio of Tata Consultancy Services (supra) is clearly distinguishable, as the said company was incorporated under the Companies Act and was carrying on the activity of 'consulting engineer' by engaging a qualified engineer and rendering advice, consultancy and technical assistance to their clients in one or more disciplines of engineering. In the present case, no such advisory, consultancy or technical assistance is furnished. The instruments are tested and test reports are furnished. Therefore, the plea raised by the Counsel that they were not covered in the category of 'consulting engineer' is required to be upheld. We notice that this very issue was considered by the Madras Bench in the case of CCE v. MRF and it was held that services rendered in the nature of 'Scientific and Technical Consultancy Services' would not come within the nature of 'Consulting Engineer Services' as claimed by revenue. The ratio of Chennai Telephones BSNL (supra) also applies to the present case, as in that case, it was held that leased circuit to telephone users is different from 'telephone service'. The Board Circular in F-B-11 /1/01 TRU, da ..... X X X X Extracts X X X X X X X X Extracts X X X X
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