CESTAT New Delhi: Separate charges for services upheld under Notification No. 12/2003-ST

The CESTAT New Delhi ruled in favor of the appellant, setting aside the order-in-appeal and allowing the appeal. The Tribunal held that the separate charges for Mandap Keeper Service and catering were compliant with Notification No. 12/2003-ST, entitling the appellant to the benefit of the notification due to separate invoicing for the services. The decision was based on a previous ruling in the appellant's favor, emphasizing the distinct nature of the services provided.

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Issues:
Interpretation of service tax liability on charges for Mandap Keeper Service and catering services; Compliance with Notification No. 12/2003-ST.

Analysis:
The appellant, registered under Mandap Keeper Service, faced a show cause notice for allegedly splitting service charges to avoid service tax. The Deputy Commissioner confirmed a service tax demand of Rs. 3,93,140 along with penalties and interest. The Commissioner (Appeals) upheld this decision, leading the appellant to appeal before CESTAT New Delhi.

The appellant argued that the sale of food, charged separately and subject to VAT, should not be considered a service. They claimed that not all Mandap Keeper Service customers availed catering, treating both activities as distinct. The Departmental Representative supported the order-in-appeal findings.

CESTAT noted a previous decision in the appellant's favor, where the separate charges for Mandap Keeper Service and catering were deemed compliant with Notification No. 12/2003-ST. CESTAT held that the appellant was entitled to the benefit of the notification, as demonstrated by the separate invoicing for the services. Therefore, they set aside the impugned order-in-appeal and allowed the appeal in favor of the appellant.

In conclusion, CESTAT New Delhi found the impugned order-in-appeal lacking merit, following the precedent set in the appellant's previous case. The Tribunal ruled in favor of the appellant, setting aside the order and allowing the appeal.

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