No Service Tax Is Payable On Installations On CNG Kits In Absence Of Separate Invoices: CESTAT
Mariya Paliwala
31 March 2024 12:00 PM IST
The Ahmedabad Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that no service tax is payable on installations on CNG kits in the absence of separate invoices. The bench of Ramesh Nair (Judicial Member) and Raju (Technical Member) has observed that separate invoices were not found as regards the assessee having carried out installations on CNG kits. Despite...
The Ahmedabad Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that no service tax is payable on installations on CNG kits in the absence of separate invoices.
The bench of Ramesh Nair (Judicial Member) and Raju (Technical Member) has observed that separate invoices were not found as regards the assessee having carried out installations on CNG kits. Despite the assessee having carried out such installations and paid VAT thereon, it cannot be ipso facto concluded that they have not rendered any taxable service and are not liable to service tax.
The respondent or assessee is engaged in providing service under the category of 'Authorised Service Station' for motor vehicle servicing and repair. During the course of the audit, it was noticed that they had not added the value of consumables used while providing service to vehicle owners and the free service commission to the taxable value and were thereby found to have short-paid service tax by not including the cost of spare parts consumed in the gross taxable value.
The Commissioner confirmed the demand for service tax along with interest and penalties while dropping the demand as raised in the show cause notice.
The department contended that the Commissioner has erred in extending the benefit of cum-tax to the assessee and thereby erred in less-confirming the demand along with consequential interest and penalty. The Committee, under the provisions of 86(2) of the Finance Act, 1994, directed the Commissioner to apply to the Tribunal for the correct determination of the following points arising out of the order.
The CESTAT held that positive findings need to be recorded on the basis of factual verification as regards the existence of separate bills for spare parts and/or payment of sales tax or VAT thereon before arriving at the conclusion to drop demand. Therefore, in the interest of justice, the said issues need to be examined in depth.
Counsel For Appellant: Rajesh R Kurup
Counsel For Respondent: Rahul Gajera
Case Title: Commissioner of C.E. & S.T.-Surat-i Versus J K Motors
Case No.: Service Tax Appeal No. 11981 of 2014 – DB
