2022 (6) TMI 583 - AT - Service Tax

Tribunal remands appeal for fresh order, stresses importance of exemptions & documents.

Ssb Facility Management Service Pvt Ltd Versus C.C.E. & S.T. -Surat-I

The tribunal allowed the appeal by remanding the matter to the Adjudicating Authority for a de novo order, emphasizing the importance of considering all ... Valuation of services - Cleaning activities in respect of non-commercial building or premises - non-inclusion of value of the materials supplied to the service receivers - the appellant’s submission in the defence is that department has gravely erred in not allowing exemption and deduction claimed while arriving at final taxable value - HELD THAT:- Cleaning activities in respect of non-commercial building or premises is not taxable. The Government in its Departmental Instruction vide TRUs letter F.No. B1/6/2005-TRU dated 20.07.2005 has clarified that “cleaning service in respect of non-commercial building and premises thereof would not be covered within the purview of service tax under this category.” Further Notification No. 9/2009-ST dated 03.03.2009, exempts the taxable services specified in clause (105) of Section 65 of the Finance Act, which are provided in relation to the authorized operations in a Special Economic Zone, and received by a developer or units of a Special Economic Zone, whether or not the said taxable services are provided inside the Special Economic Zone, from the whole of the Service tax leviable thereon under section 66 of the Finance Act - The demand of Service tax on material value supplied to the client during the impugned period was not justifiable. Service tax cannot be leviable on value of material supplied to the client. Notification No. 12/2003-ST dated 20.06.2009 provides exemption. They made declaration under VCES after considering the exemption and deductions. The appeal is allowed by way of remand to the adjudicating authority to pass a de novo order after considering all the exemptions and documents /records to be submitted by the appellant before him. Issues:Appeal against service tax demand confirmation - Exemption and deduction claimed - Non-representation before adjudicating authority - Ex-parte order - Opportunity for appellant to present claims and defense - Remand for fresh order.Analysis:The appeals were directed against a common Order-in-Original confirming service tax demands against two entities. The issue revolved around the non-inclusion of material value supplied to service receivers in the service tax calculation. The appellants failed to respond to summons and show cause notices, leading to an ex-parte order confirming the service tax demand. The appellants contended that cleaning activities for non-commercial buildings are not taxable, citing relevant government notifications for exemption and deductions. They also made declarations under VCES considering exemptions. The tribunal noted the appellants' non-representation before the adjudicating authority and granted them an opportunity to present their claims and defense with supporting documents related to exemptions and deductions within three months. The impugned order was set aside, and the matter was remanded for a fresh order after considering all exemptions and documents submitted by the appellants, ensuring a fair opportunity for submission and personal hearing.Conclusion:The tribunal allowed the appeal by remanding the matter to the Adjudicating Authority for a de novo order, emphasizing the importance of considering all exemptions and documents provided by the appellants. The decision aimed to uphold principles of justice by granting the appellants an opportunity to present their case effectively and have their claims regarding exemption and deductions duly considered in the fresh adjudication process.