Appeal allowed, service tax demand set aside pre-1.6.2007. Works Contract Services applicable.

The Tribunal allowed the appeal, setting aside the demand for service tax for the period before 1.6.2007 under the category of maintenance and repair services. It ruled that the services provided fell under Works Contract Services (WCS) both before and after the introduction of WCS, based on evidence presented by the appellant. The Tribunal held that services falling under WCS post-1.6.2007 cannot be charged under a different category for the period before that date, citing a Supreme Court decision.

---

---

Issues:
1. Demand of service tax for maintenance and repair services provided prior to the introduction of Works Contract Services (WCS).
2. Justification for the demand of service tax for the period prior to 1.6.2007 under the category of maintenance and repair services.
3. Applicability of limitation on the demand of service tax for the period 2006-2007.
4. Classification of services rendered as Works Contract Services (WCS) or maintenance and repair services.

Analysis:

Issue 1: The appeal challenged the demand of service tax for maintenance and repair services provided prior to the introduction of Works Contract Services (WCS). The appellant contended that the nature of services rendered remained the same before and after the introduction of WCS, falling under the category of WCS. The department alleged that the services rendered were in the nature of repair and maintenance services.

Issue 2: The appellant argued that there was no justification for demanding service tax for the period before 1.6.2007 under the category of maintenance and repair services. They emphasized that since they were already registered for maintenance and repair services under WCS and paying service tax, the demand for the prior period was unjustified.

Issue 3: The appellant raised the issue of limitation on the demand for service tax for the period 2006-2007. They pointed out that the demand was issued through a Show Cause Notice dated 20.10.2011, and contended that the demand was hit by limitation.

Issue 4: The Tribunal analyzed the nature of services rendered by the appellant both before and after the introduction of WCS. The appellant provided evidence through work orders and VAT registration to support their argument that the maintenance work undertaken involved both services and supply of goods, falling under the category of Works Contract Services. The Tribunal held that the activity carried out was in the nature of WCS even for the period prior to 1.6.2007, citing a Supreme Court decision that services covered within the description of WCS post-1.6.2007 cannot be charged under a different category for the period before that date.

In conclusion, the Tribunal set aside the impugned order and allowed the appeal, ruling that the demand for service tax for the period prior to 1.6.2007 under the category of maintenance and repair services could not be sustained based on the nature of services provided by the appellant.

---