2019 (5) TMI 1570

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....ken up for disposal by a common order. 3. The brief facts of the case are that M/s. Xerox India Limited (Xerox for short) is engaged in the business of manufacture/ import and sale of photocopiers, printers, scanners, fax machines, MFDs, etc., their parts and accessories and are providing the service of maintenance of the said products. The assessee has undertaken the service activities of Maintenance and Repairs as per the contract of Full Service Maintenance Agreements (FSMA), Spares and Service Agreements (SSMA), Volume Based Service Agreements (VBSA) and Annual Maintenance Contracts (AMC). For the above said agreements, M/s. Xerox charged service tax on the standard percentage of labour deduction allowed under State Sales Tax/ VAT pr....

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.... the case of Wipro GE Medical Systems Limited (supra) M/s. Xerox is liable to pay service tax only on Labour Portion. In the said case, it Tribunal observed as under:- "8. On a very careful consideration of the fact, we find that there is no dispute with regard to the leviability of service tax on the maintenance and repair services. The main point of dispute is with regard to the valuation. However, Section 67 of the Finance Act clearly provides for the abatement of the value of the goods sold in the course of the carrying out of the service. The point is whether the goods are actually sold. According to the department, the contract is only for the maintenance and repair. Therefore, it cannot be said that the spare parts were sold....

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....ree with the learned Commissioner that the said Constitutional provision has no application here. The Maintenance and Repair Contract entered by the appellant with their customers has been recognized as Works Contract by the Government of Karnataka and the registration has been obtained for payment of sales tax. When that is the case, it cannot be said that the spare parts received by the clients of the appellant have not been sold to them. We hold that in any Annual Maintenance Contract the spare parts etc. which have been used in the course of the maintenance service are definitely to be considered as sold and when sales tax has been paid on the value of such goods, simultaneously one cannot charge them to the service tax. In view of thes....