2018 (1) TMI 376

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.... received consideration. They were registered with the department and paid Service Tax under the category of supply of tangible goods w.e.f. 16/05/2008. The Revenue entertained the view that the appellants are liable to pay Service Tax under category of Club or association Service for the period 01/04/2006 to 16/05/2008. Another dispute is with reference to Service Tax liability of the appellant under the category of repair and maintenance service for the period 2006 to 2011. In pursuance of an agreement with M/s Honeywell, France the appellants got the engines of the aircraft repaired, whenever required. For this they have paid consideration to the foreign company. The said consideration was sought to be taxed under reverse charge basis ag....

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....harged on repair and maintenance service is fully cenvatable for them and in such situation there could be no malafidee or misrepresentation in order not to discharge the Service Tax. Accordingly, he prayed against the demand for extended period as well as for imposition of penalties. 6. The Ld. AR reiterated the findings of the Original Authority. Regarding the repair and maintenance service he submitted that the appellant have entered into an agreement with M/s Honeywell, France. The appellants have no role or agreement with M/s Airworks India. M/s Honeywell in order to repair the aircraft engine, have to undertake the work of removing the engine, transporting, repairing and sending it back to India for refitting. All these activities ....

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....or aircraft engine to M/s Honeywell, without any reference to the work carried out by M/s Airworks in India. In other words, the appellants received taxable service of repair and maintenance. The said service has been carried out and provided by M/s Honeywell partly in India and partly in France. M/s Honeywell used another sub-contractor on their own to render the part of repair service in India will bring the tax liability to the appellant in view of the proviso to Rule 3 (ii) of Taxation of Services Rules, 2006. Here we note that this reasoning is not adopted by the Original Authority. However, the Original Authority simply relied on the statutory provisions and held that the appellants are liable to service tax for repair and maintenance....