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of <h1>Tribunal remands case for fresh determination on service tax for composite works</h1> The Tribunal allowed the appeal by way of remand, setting aside the order and remanding the matter to the Commissioner for fresh determination in light of ... Levy of Service Tax - painting charges - Works Contract - case of appellant is that they are paying work contract tax to the state government; hence, the same activity cannot be subjected to another tax, namely, service tax - Held that:- The Ld. Commissioner (Appeals) has taken the view that mere payment of work contract tax by itself will not lead to exemption from service tax. Further, it is not disputed that the said activity was in the nature of the work contract. The Ld. Commissioner (Appeals) did not have the benefit of the judgment of Hon’ble Supreme Court in the case of CCE, Kerala vs. Larsen and Toubro Ltd. [2015 (8) TMI 749 - SUPREME COURT] while analyzing the issues in the impugned order. It would therefore be appropriate to set aside the order and to remand back the matter to the first appellate authority for fresh determination in the light of the judgment of Hon’ble Supreme Court in the case of CCE, Kerala vs. Larsen and Toubro Ltd. - Appeal allowed by way of remand. Issues:Levy of service tax on painting charges collected by authorized service station service provider. Interpretation of law regarding payment of service tax on composite work involving sale of goods and provision of service. Applicability of Notification No.12/2003-ST. Invocation of longer period of limitation for tax assessment.Analysis:The case involved a dispute over the levy of service tax on painting charges collected by an authorized service station service provider. The appellants contended that they were already paying work contract tax on painting charges and service tax on repair charges, arguing that painting is a composite work involving both sale of goods and provision of service. They cited the judgment in the case of CCE, Kerala vs. Larsen and Toubro Ltd. (2015) to support their claim that service tax cannot be levied for the period prior to 1.6.2007. Additionally, they relied on judgments like Imagic Creative Pvt. Ltd. vs. CCT and Bharat Sanchar Nigam Ltd. vs. UOI to support their position. The appellants also referred to Notification No.12/2003-ST and contended that the value of goods/materials sold during the provision of taxable service should be included. They argued that the amount received should be treated as cum-tax and that the longer period of limitation should not be invoked due to their bona fide belief regarding the non-liability of service tax on paint costs.The learned Advocate for the appellant presented their arguments, while the learned AR for the respondent reiterated the submissions made in the order of the Commissioner (A). The Tribunal considered the contentions of both sides and examined the records. It was noted that the appellants provided authorized service station service, including repair and painting of vehicles. The dispute centered on the levy of service tax on the painting activity. The Tribunal observed that the appellants claimed the painting service was carried out by sub-contractors and argued that since they were paying work contract tax, service tax should not apply. The Tribunal found that the Commissioner (A) did not consider the judgment in the case of CCE, Kerala vs. Larsen and Toubro Ltd. (2015) while making the decision. Therefore, the Tribunal set aside the impugned order and remanded the matter back to the Commissioner (A) for fresh determination in light of the mentioned judgment. The Tribunal allowed the appeal by way of remand, keeping all issues open for further consideration.In conclusion, the judgment highlighted the importance of considering relevant legal precedents and notifications in determining the applicability of service tax on composite works involving both sale of goods and provision of service. The decision emphasized the need for a fresh assessment in light of applicable legal principles, specifically referencing the judgment of the Hon'ble Supreme Court in the case of CCE, Kerala vs. Larsen and Toubro Ltd. (2015).
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