2017 (4) TMI 954

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....Consultancy Services". The appellants also carried out various research, development project, training programmes, acting as nodal agency on behalf of different Ministries of the Central Government and Madhya Pradesh Government. They received grants-in-aid in respect of these activities from the concerned Ministries. The Revenue entertained a view that the appellants are liable to service tax in respect of these activities carried out on behalf of the various government Ministries. Accordingly, proceedings were initiated to demand and recover service tax on such consideration received from the Government, under the category of "Management, Consultancy Services". The Original Authority adjudicated the cases. In the impugned orders, the Original Authority confirmed the service tax liability of Rs. 82,25,013/- and Rs. 95,65,343/- under the category of "Management Consultancy Services". A further demand of Rs. 2,34,646/- was also confirmed by denying cum-tax benefit to the appellant. Rs. 22,500/- and Rs. 3,049/- were confirmed after denial of cenvat credit availed in respect of certain incomplete documents and catering services respectively. 3. Ld. Counsel appearing for the appellants....

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....Rs. 22,500/-, it is submitted that the credit is rightly admissible as the input services have been availed and service tax has been paid by the appellant. The invoices were in the name of branch and the head office and that by itself cannot be the reason for denial of credit. 7. Ld.AR submitted that receipt of consideration by the appellant in the name of grants-in-aid by itself will not make the service as not taxable. Admittedly, the appellants did provide service, which can be categorized under the various taxable categories like "Consulting Engineer, Convention Service, Management Consultants and Market Research Agency". The consideration is received in the form of grants-in-aid and the same is a taxable income. The appellants are not part of the Government. They are a corporate entity registered under the company law and promoted by various financial institution and banks. In such situation, it cannot be said that they are an arm of the Government and they are rendering these services as an executory function of the Government. 8. We have heard both the sides and perused the appeal records. 9. We note that the matter was remanded back to the Original Authority with a speci....

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....fference between a civil appeal and an SLP filed before the Hon'ble Supreme Court. The civil appeal is a statutory appeal provided under the law and the decision of the Apex Court in such civil appeal is binding and the order of the Tribunal, which was appealed against merges with the decision of the Hon'ble Supreme Court. The same is a binding precedent for other lower courts to follow. The observation of the original authority to the contrary is devoid of legal merit. 11. Having considered the findings of the original authority as narrated above and on perusal of the decision of the Tribunal (as affirmed by the Hon'ble Supreme Court) in Apitco Ltd., we find that the impugned orders are devoid of merit in sofar as they relate to tax liability of the appellant with reference to various works carried out by them for which consideration was paid by the Government through grants-in-aid. For easy reference, we reproduce the relevant portion of the decision of the Tribunal in Apitco Ltd. :- "6. We have given consideration to the submissions. It is not in dispute that the assessee-company had implemented welfare schemes for the Central and State governments for the benefit of the poor....

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..... In the case of Administrative Staff College of India (supra), this Bench held that, as the research activities of the assessee (Administrative Staff College) were related to social science, they would not be within the ambit of "scientific or technical consultancy" and hence no service tax could be levied under that category, which view is squarely applicable to the facts of the present case. The view taken by the Tribunal in the above case stood affirmed by the Apex Court in the above case within the dismissal of the department's Civil Appeal filed against the Tribunal's order. 7. For the reasons noted above, we hold that any amount of service tax is not leviable on the grants-in-aid received by the assessee from the governments, as project-implementing agency of the government, during the period of dispute." 12. We have perused the various documents submitted by the appellant relating to the scope of activities and the method of payment received from various departments/Ministries of the Government. The project works assigned to the appellant are in the nature of various welfare activities carried out by the Government in public interest. These are counseling, re-training an....