Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
Tribunal rules calibration service not engineering consultancy, sets aside tax demand The Tribunal set aside the tax demand on charges for calibration of measuring instruments, ruling that the service did not qualify as Engineering ...
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Tribunal rules calibration service not engineering consultancy, sets aside tax demand
The Tribunal set aside the tax demand on charges for calibration of measuring instruments, ruling that the service did not qualify as Engineering Consultancy Service as it was not proven to be performed by a qualified engineer. The Tribunal noted that the activity fell under "technical inspection and certification," a taxable service from 1-7-2003, not under Engineering Consultancy Service before that date. Consequently, the appeal was allowed in favor of the appellant, providing relief against the Service tax demand.
Issues: Demand of Service tax on charges for calibration of measuring instruments treated as Engineering Consultancy Service.
Analysis: The appeal was against a demand of Service tax on charges for calibration of measuring instruments collected by the appellants from their customers, treated as Engineering Consultancy Service for the period of dispute from 7-7-1997 to 28-2-2002. The original authority confirmed the tax demand and imposed penalties, a decision upheld by the Commissioner (Appeals), leading to the present appeal.
The appellant argued that calibration of measuring instruments is a scientific activity and not an engineering activity. The appellant's counsel contended that prior to 1-7-2003, the service was not taxable and did not fall under Engineering Consultancy Service. It was highlighted that the service provided by the appellants was tangible, not falling under the definition of "consulting engineer" or "Engineering Consultancy Service." The counsel emphasized that the department did not prove that the calibration was done by engineers, and the findings were based on personal notions rather than concrete evidence.
The Tribunal observed that the show cause notice did not specify that the activity was performed by an engineer but by "qualified personnel." The definitions of "Consulting Engineer" and "Engineering Consultancy Service" require the service to be rendered by a professionally qualified engineer or engineering firm. As the notice did not establish the appellants as a professionally qualified engineering firm or the activity as performed by a qualified engineer, it was deemed impossible to accept the Revenue's claim that the calibration constituted "Engineering Consultancy Service." The Tribunal noted that calibration of measuring instruments fell under "technical inspection and certification," a taxable service effective from 1-7-2003, and not under Engineering Consultancy Service prior to that date.
Consequently, the Tribunal set aside the impugned order, allowing the appeal in favor of the appellant. The decision was dictated and pronounced in open court, providing relief to the appellant against the demand of Service tax on charges for calibration of measuring instruments.
Full Summary is available for active users!
Note: It is a system-generated summary and is for quick reference only.
TaxTMI 
AI Drafter - (New and Powerful) ✕
Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter. 
of 
TaxTMI 
