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of <h1>Tribunal rules on Cleaning Service tax dispute, emphasizing waste removal and site cleaning over formation.</h1> The Tribunal held the appellant liable for Cleaning Service tax, rejecting arguments for categorization under Cargo Handling or Site Formation Service. ... Waiver of pre deposit - Cleaning Service and Site Formation and Clearance, Excavation and Earthmoving and Demolition Service - Held that:- Appellant was engaged in restoration of waste pits in the oil extraction area of M/s. Cairn Energy and what they are doing physically is to clean the pits and bring them into a condition in which they are usable again. Therefore what the appellant is undertaking the activity of cleaning the pits of waste, oil etc and therefore the activity is clearly cleaning only. - work undertaken by the appellant is provision of pit restoration services at drill sites. The objective as per Clause 2 of the agreement is to restore waste pits and for this purpose the service providers have to undertake skimming of oily waste, collection, redistribution and transportation of oily and non oily drilling waste and thereafter restoration and back filling of the pits with locally available soil. It can be seen from the objective itself that the main objective is to clean the pits by removing oily and non oily waste completely and thereafter put in fresh soil (back filling). The main activity is not Site Formation since the drilling site is already existing and what the appellant to undertake is to remove the waste from the existing drilling site and clean up all the wastage and bring it back to the original condition. The Cleaning Service definitely covers the activity. Therefore on merit we do not consider that appellants have made out a case. - Partial stay granted. Issues:1. Whether the appellant should have paid service tax for providing Cleaning Service.2. Whether the work undertaken by the appellant falls under Cleaning Service, Cargo Handling Service, or Site Formation Service.3. Whether the demand for service tax and penalties imposed are sustainable.Analysis:1. The appellant provided services to M/s. Cairn Energy India Pvt. Ltd., including waste removal, transportation, skimming, and back filling of pits. The appellant argued that the work falls under other works/site formation/repairs and should be taxed under the Works Contract system. They claimed to have paid a certain amount already and requested a waiver for the balance. The appellant also contended that the service receiver treated the service as Works Contract under VAT rules. The Tribunal considered the submissions but found the appellant liable for Cleaning Service tax. The appellant was directed to deposit a specified amount within a deadline for stay against recovery during the appeal.2. The appellant argued that the work undertaken did not constitute Cleaning Service but could be categorized as Cargo Handling Service or Site Formation Service. The Tribunal examined the nature of the work, focusing on the agreement's details regarding waste removal and restoration. The Tribunal highlighted the method of waste collection and disposal, emphasizing the cleaning aspect involved in the activity. The appellant's assertion that the main activity was site formation by filling up pits with soil was countered by the Tribunal, which concluded that the primary objective was cleaning the pits and restoring them to their original condition. Therefore, the Tribunal upheld the classification of the service as Cleaning Service.3. The Tribunal reviewed the agreement's scope of work, which involved pit restoration services at drill sites. It was noted that the primary objective was to clean the pits by removing waste and back filling them with fresh soil. The Tribunal determined that the main activity was not Site Formation but Cleaning Service, as the focus was on cleaning the existing drilling site. The Tribunal found no merit in the appellant's case, as no financial difficulty was substantiated. Consequently, the Tribunal directed the appellant to deposit a specified amount within a stipulated timeframe, with a waiver for the balance, and granted a stay against recovery pending the appeal process.
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