Business Auxiliary Service classification for re-rubberisation was preferred, securing exemption under Notification No. 14/2004.

Re-rubberisation of old rubberized rollers was treated as Business Auxiliary Service rather than Management, Maintenance or Repair Service because the earlier Tribunal view on the same process was followed and the classification that came into existence first was preferred. On that classification, the activity attracted nil service tax under Notification No. 14/2004. The impugned orders were set aside, and the connected matter was remanded for fresh decision on merits without insisting on pre-deposit.

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Issues: Whether the activity of re-rubberisation of old and worn-out rubberized rollers is classifiable as Business Auxiliary Service or as Management, Maintenance or Repair Service, and whether the assessee is entitled to exemption from service tax under Notification No. 14/2004.

Analysis: The activity was treated as falling under two possible service classifications, but the earlier Tribunal decisions on the same process were followed. It was held that Business Auxiliary Service, having come into existence earlier, was the appropriate classification. Once so classified, the service attracted nil tax liability under the exemption notification. On the connected stay-order appeal, the matter was remanded to the Commissioner (Appeals) for decision on merits in the light of the declaration of law, without insisting on pre-deposit.

Conclusion: The activity was held to be Business Auxiliary Service and exempt from service tax under Notification No. 14/2004. The impugned orders were set aside, and the connected matter was remanded for fresh decision on merits without pre-deposit.

Ratio Decidendi: Where an activity is capable of classification under two taxable heads, the classification that came into existence earlier prevails, and the resulting exemption notification must be applied accordingly.

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