TaxTMI 
TaxTMI 
2014 (4) TMI 920
X X X X Extracts X X X X
X X X X Extracts X X X X
.... collected from the customers. However, they did not pay service tax on the food charges collected from the customers. It was their contention that, as regards supply of food, the transaction is one of sale and therefore, no service tax is leviable. They also claimed that food is exempt from sales tax. Two show cause notices were issued to the appellant one dated 15/11/2010 demanding service tax of Rs.1,10,76,686/- towards service tax short paid on the value of catering undertaken by them during the period 2005-06 to 2009-10. The second show cause notice dated 22/07/2010 covers the demand of service tax of Rs.44,15,259/- for the period 01/04/2010 to 30/09/2011. There is also another demand of service tax towards renting of immovable property to the extent of Rs. 1,76,197/- in the first show cause notice. All these demands were confirmed along with interest thereon and also by imposing penalties under Sections 76, 77 and 78 of the Finance Act, 1994, in the case of the first show cause notice and in respect of the second show cause notice under Sections 76 and 77. Hence the appellant is before us. 3. The learned consultant for the appellant submits that they charge for the caterin....
X X X X Extracts X X X X
X X X X Extracts X X X X
....to the appellant from the gross consideration received. Accordingly, he pleads that the matter needs to be remanded back to the adjudicating authority for re-computation of Service Tax and the consequential interst and penal liabilities. 4. The learned Additional Commissioner (AR) appearing for the Revenue strongly refutes the contention of the appellant and submits that the issue involved herein is covered by the decision of the hon'ble Supreme Court in the case of Tamil Nadu Kalyana Mandapam Assn. vs. Union of India 2004 (167) ETL 3 (SC) wherein it was held that service tax on catering services does not amount to tax on sale and purchase of goods and the service tax on Madap Keeper and outdoor caterers is in pith and substance a tax on services and not a tax on sale of goods or on hire purchase activities. He also relies on the decision of this Tribunal in the case of Sayaji Hotels Ltd. vs. Commissioner of Central Excise, Indore 2011 (24) STR 177 (Tri.Del.) wherein an identical issue was considered by this Tribunal and it was held that in the case of Mandap Keeper Services, catering service is incidental and ancillary to the Mandap Keeper services and, therefore, the charg....
X X X X Extracts X X X X
X X X X Extracts X X X X
....a Mandapam Assn (supra) and the hon'ble apex Court in para 55 and 57 thereof held as follows: "55. In fact, mandap-keepers provide a wide variety of services apart from the service of allowing temporary occupation of mandap. As per Section 65 (19) of the Finance Act, 1994, Mandap means any immovable property as defined in Section 3 of the Transfer of Property Act, 1882 and includes any furniture, fixture, light fittings and floor coverings therein let out for consideration for organising any official, social or business function. A mandap-keeper apart from proper maintenance of the mandap, also provides the necessary paraphernalia for holding such functions, apart from providing the conditions and ambience which are required by the customer such as providing the lighting arrangements, furniture and fixtures, floor coverings etc. The services provided by him cover method and manner of the decorating and organising the mandap. The mandap-keeper provides the customer with advice as to what should be the quantum and quality of the services required keeping in view of the requirement of the customer. The nature of the event t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....in any manner including the facilities provided to a customer in relation to such use also the services, if any, rendered as a caterer. The nature and character of this service tax is evident from the fact that the transaction between a mandap-keeper and his customer is definitely not in the nature of a sale of hire purchase of goods. It is essentially that of providing a service. In fact, as pointed out earlier, the manner of service provided assumes predominance over the providing of food in such situations which is a definite indicator of the supremacy of the service aspect. The legislature in its wisdom noticed the said supremacy and identified the same as a potential region to collect indirect taxes. Moreover, it has been a well established judicial principle that so long as the legislation is in substance, on a matter assigned to a legislature enacting that statute, it must be held valid in its entirety even though it may trench upon matters beyond its competence. Incidental encroachment does not invalidate such a statute on the grounds that it is beyond the competence of the legislature (Prafulla Kumar vs. Bank of Commerce). Article 246(1) of the Constitution specifies that ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... As regards the contention of the appellant with regard to time bar, there is some merit in this argument. The show-cause notice dated 15.11.2010 seeks to demand Service Tax for the period 1.4.2005 onwards i.e. even beyond the extended period of 5 years. Therefore, the demand for the period 1.4.2005 to 30.9.2005 falls outside the extended period and confirmation of Service Tax demand in respect of this period cannot be legally sustained and, we hold accordingly. 5.6 As regards the question whether extended period of time could be invoked at all in this case, the appellant's contention is that in respect of other unit of the appellant, the issue was considered vide order dated 30.10.2010 and the demands were dropped and therefore, the department had knowledge. This argument cannot be accepted for the following reasons:- (a) As per the Service Tax law, each premises of the appellant from where business is carried out is a separate assessee and is separately registered for the purpose of Service Tax. Therefore, the Service Tax assessee is separate for each of the premises registered and they have to be treated independently and sepa....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ent acquires knowledge of irregularities, suppression is not obliterated. The hon'ble Court further held that the concept of knowledge cannot be read into the provisions relating to invocation of extended period of time for confirmation of demand. In the present case, the appellant did not declare to the department the non-inclusion of food charges in the consideration received nor did they declare the receipt of consideration in the ST-3 returns. Thus, there is a willful mis-statement of facts with an intent to evade tax on the part of the appellant. Therefore, the extended period of time has been rightly invoked to confirm the Service Tax demand and we hold accordingly. 5.7 As regards the contention of the appellant that they should be given abatement during the period 2005-06 to 2007-08, the abatement would be available only if the appellant had not availed CENVAT Credit on inputs/input services during the material period. If the appellant had availed CENVAT Credit, then benefit of abatement cannot be extended. However, this is a question of fact, which needs to be verified by the adjudicating authority. 5.8 We also observe that there is an error in computation of Serv....