TaxTMI 
TaxTMI 
2024 (9) TMI 701
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....h section 174 of the Central Goods and Service Tax Act, 2017 [the 2017 Act] with interest and penalty. 2. The appellant is a public sector undertaking of the Government of India under the Ministry of Defence and is inter alia engaged in maintenance and repair services of Heavy Earth Moving Machinery [Heavy Machinery]. The repair and maintenance also entail supply of spare parts and consumables in respect of such Heavy Machinery. For this purpose, the appellant entered into Maintenance and Repair Contracts [Repair Contract] with its customers to whom Heavy Machinery machines were supplied from its manufacturing units. 3. The appellant entered into Agreement dated 30.12.2009 with M/s. Northern Coalfields Ltd [Northern Coalfields] in r....
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....f the appellant, in their very nature and substance, were pure service contracts for repair work and labour in which spare parts and materials were used incidentally, and so of the amount received by the appellant towards cost of spare parts should form part of the value of repair services. 7. This show cause notice was adjudicated upon by an order dated 30.07.2018. Service tax demand of Rs. 4,78,75,288/- has been confirmed with interest and penalty holding that the contract entered by the appellant with the customers is an instrument to escape the service tax liability by attributing a disproportionate amount to the cost of spares and consumables. Accordingly, service tax has been held to be recoverable on the amount of cost of spare part....
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....composite works contract. 12. This issue was examined by a Division Bench of the Tribunal in M/s. Samtech Industries And others vs. Commissioner of Central Excise, Kanpur and Others [2014 (4) TMI 995-CESTAT NEW DELHI] and it was observed: "5. We have considered the submissions from both the sides and perused the records. The appellants provided the services of repair of transformers to their customers and in course of repair, they used various parts and consumables like transformers oil, for which separate amounts were shown in the invoices. The invoices issued by them show the value of the goods used and the service charges separately. The amounts charged for various parts like HV/LV oils and transformer oil are as per the rates s....
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....66 & Section 67 of the Finance Act, 1994 by Hon'ble Delhi High Court in the case of Intercontinental Consultants & Technocrats Pvt. Ltd. v. Union of India & Others Ltd. reported in 2012-TIOL-966-HC-Del.-ST = 2013 (29) S.T.R. 9 (Del.). In view of this judgment of Hon'ble Delhi High Court, the value of goods used for providing the service, which had been shown by the appellant separately in their invoices and on which Sales Tax/VAT had been paid, cannot be included for assessable value and no Service Tax can be charged on the same. The impugned orders, therefore, are not sustainable. The same are set aside. The appeals are allowed. Miscellaneous Application No. ST/Misc/60886/2013 for extension of stay in respect of Appeal No.ST/286/2012 a....
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....he customer is a sale or not, is to be determined taking into account the real nature and material facts of the transaction. Payment of VAT/ sales tax on a transaction indicates that the said transaction is treated as sale of goods. Any goods used in the course of providing service are to be treated as inputs used for providing the service and accordingly, cost of such inputs form integral part of the value of the taxable service. Where spare parts are used by a service station for servicing of vehicles, service tax should be levied on the entire bill, including the value of the spare parts, raised by the service provider, namely, service stations. However, the service provider is entitled to take input credit of excise duty paid on suc....