TaxTMI 
TaxTMI 
2017 (4) TMI 1085
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....Revenue held a view that the appellants are liable to service tax in terms of Section 65 (108) of the Finance Act, 1994 under the category of Technical Inspection and Certifying Agency Service. 2. Appeal No. ST/837 of 2011 deals with the claim of the appellant for refund of service tax amounting to Rs. 2,88,60,509/-. The appellants filed refund claim for the said amount on 08/03/2010. The amount was paid on 10/03/2009. A show cause notice dated 05/05/2010 proposing rejection of the said claim was issued. The Jurisdictional Assistant Commissioner adjudicated the case and issued order dated 18/11/2010 rejecting the claim of the appellant. On appeal, vide impugned order dated 03/03/2011, the learned Commissioner (Appeals) upheld the rejection by the Original Authority. The appellant is in appeal before us against the said order. 3. Appeal No. ST/50686 of 2014 is against original order dated 22/11/2013 of Commissioner of Central Excise, Bhopal confirming the service tax demand of Rs. 93,14,970/- against the appellant for the period January 2009 to February 2010. The Original Authority also imposed penalties under Section 76, 77 and 78 of the Finance Act, 1994. The second appeal is ag....
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....tion of the item and the said item continues to remain in the same physical form, after inspection also. Whereas, the testing of seeds by appellant involves process of natural germination, sprouting and growth of plant and thereby resulting in loss of seeds which are subjected to test. As such, it is contended that the certification undertaken by the appellant is not covered by tax category of technical inspection and certification service. The learned Counsel also submitted that Notification No. 10/2010-ST dated 27/02/2010 exempted activities of seed testing by Central/State Seed Certification Agencies and indicated both the above services. It only shows that the Government itself was not sure about the correct classification of the service rendered by the appellant. It is claimed that the functions of the appellant are similar to the functions of police providing armed guards to banks, public sector units etc., on payment of cost for deployment. In that case, the Tribunal held the activities as not taxable relying on the basis of Circular dated 23/08/2007 of the Board. The appellants also relied on various case laws to support their contention. 7. Regarding the appea....
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....10. As such, the appellants are eligible for exemption from that date. The said notification is only prospective and will not provide any exemption for the period prior to 27/02/2010. 9. We have heard both the sides and perused the appeal records. The central point of dispute is the appellant's liability to pay service tax for testing and certification of seeds. The appellants contended that they are a statutory authority, performing a statutory function and there is no service element to be taxed under the category of technical inspection and certification. The statutory definition of technical inspection and certification is as below :- Section 65 (108) : "technical inspection and certification" means inspection or examination of goods or [process or material or information technology software] or any immovable property to certify that such goods or process or material or immovable property qualifies or maintains the specified standards, including functionality or utility or quality or safety or any other characteristic or parameters, but does not include any service in relation to inspection and certification of pollution levels"; Section 65 (109) : "technical inspection an....
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....d the provisions of Seed Act, 1966.The appellants were constituted in terms of Section 8 of the Seeds Act, 1966. The said section states that the State Government or Central Government in consultation with the State Government may, by notification establish a certification Agency to carry out the function entrusted to the certification Agency by or under this Act. Section 9 states that any person selling, keeping for sale, offering to sale any notified kind or variety of seed may have the same certified by the certification Agency. On payment of fee for such certification, an application can be made. On perusal of the provisions of the Act, we note certification of notified type of seed is an optional requirement. The appellants contended that they are entrusted with enforcement of various provisions of the Act and, as such, they are performing a statutory function. We note that the fees and charges collected by the appellant are with reference to the optional activity of a person approaching the appellant for certification. The appellants do have various other statutory functions with reference to declared seeds in terms of Section 5 of the Act. The Government can fix quality stan....
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....o reason to interfere with the orders of the lower authorities rejecting the refund claim of the appellant. 14. Regarding the adjudication proceedings initiated by issue of show cause notice dated 22/10/2010. We note that the said notice invoked extended period of limitation and the adjudication order also confirmed demand for extended period alongwith penalties under Section 76, 77 and 78 of the Finance Act. We find that while the appellant's liability to service tax is upheld, there can be no allegation of fraud, suppression, willful misstatement etc. against the appellant. It is very clear that investigation by officers of DGCEI, Indore started way back in May 2006. After the applicant furnished relevant information, the enquiry was dropped in November 2006. Thereafter, in December 2008 again the local Jurisdictional Central Excise officers commenced an enquiry and after due examination of the records addressed letters to the appellant to pay service tax due for the past period from July 2003 to December 2008. The appellants discharged the service tax on 10/03/2009. Thereafter they filed a claim for refund also. In such situation, show cause notice dated 22/10/2010 was issued i....