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TMI Blog2009 (3) TMI 193X X X X Extracts X X X X X X X X Extracts X X X X ..... 00/- under Section 76 (iv) Penalty of Rs. 1000/- under Section 77; (v) Equal penalty amounting to Rs. 2,13,71,627/- under Section 73; and (vi) Interest under Section 75 has been demanded 2. We heard both sides. 3. The appellants under an agreement of operation and maintenance of the power plant of M/s. GVK Industries Ltd. render certain services. The issue involved is whether such services would fall under "maintenance and repair" for the period from 1-7-2003 to 15-6-2005 and that of "management and maintenance and repair" for the period from 16-6-2005 to 30-9-2007. The learned advocate stated that the issue is covered in favour of the appellant vide M/s. CMC (India) Operations & Maintenance Co. Put. Ltd. v. CCE - 2007 (7) S.T.R. 369 ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 24-6-2004 to 6-11-2007. There was no intention to evade payment of the Service Tax. In view of the above, the longer period could not have been invoked. 4. The learned departmental representative stated that the case laws relied on by the appellant are not applicable to the present case. She also stated that there is a clear agreement of operation and maintenance between the appellant and the M/s. GVK Industries Ltd. She stated that the cases relied on by the appellant are distinguishable and therefore, requested the Bench to put the appellants to terms. 5. The appellant M/s. GVK Power & Infrastructure Limited (GVKPIL) prior to 2005 was known as M/s. Jegurupadu Operating & Maintenance Company. Later, the said company was taken over by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rials effectively and efficiently by the appellants. Payments were received by the appellant from GVKIL on the basis of annual availability of the plant. The Commissioner in the impugned order has given a finding that the appellants rendered the services of maintenance and repair for the first period and with effect from 16-5-2005 to 30-9-2007, they rendered the services of management maintenance or repair services. He stated further that the CMS (I) Operations & Maintenance Co. Pvt. Ltd. case cited supra is not applicable, since the issue examined in that case was whether they were management consultants or consulting engineers, whereas the issue before him was whether the appellant had rendered maintenance services or not. Further, the Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or. The terms of the contract vest complete freedom and responsibility on the appellant, without any interference by the owner. The owner's right is restricted to entry and access, to be satisfied that the operation is carried out according to standards. He also receives reports about the relevant aspects of operation, status and output. The payment for operation and maintenance are determined under the various clauses of the contract. In addition to the lump sum payment, it also provides for bonus and penalty. The terms of the contract do not envisage or involve providing any consulting or engineering help to the owner. The operator is fully autonomous and responsible for the performance of operation and maintenance. Whatever engineering i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ir" and "management, maintenance and repair", the ratio of the above Rolls Royce Case is squarely applicable. The appellant under the contract is to operate the entire power plant and maintain it. That is why it is known as the "operation and maintenance contract". Once the appellant undertakes to operate and maintain the power plant under a contract, we cannot say that the appellant is rendering a service to the owner of the power plant. In fact, if at all any service is rendered, the service will be only to the appellants themselves. In that case, no Service Tax is attracted. Prima facie, we are of the opinion that the ratio of Rolls Royce Case would be applicable here. Moreover, there is no separate contract for maintenance and repair or ..... X X X X Extracts X X X X X X X X Extracts X X X X
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