Case Law Details
Agrawal Colour Advance Photo System Vs Commissioner of Central Excise and Another (Madhya Pradesh High Court at Jabalpur)
The issue under consideration is whether while providing photography service whether the use of the paper upon which an image is printed using certain consumables and chemicals, being incidental to the provision of service, amount to sale of goods in terms of Article 366(29A)(b) of the Constitution and whether value of photography service shall be determined in isolation of cost of such goods?
The appellant is engaged in the business of processing, printing, and exposure of color photographic film and obtained service tax registration for providing service on photography as provided under Section 65(63) of the Service Tax Chapter V of Finance Act, 1994. During the scrutiny of ST-3 returns, it was found that the appellant had not paid the service tax correctly.
The photography service, which has both the elements of goods and services, is covered under works contract and such contracts can be subjected to sales tax by the States under Entry 54 of List II of Schedule II of the Constitution of India.
When value of photography paper upon which an image is printed and certain consumables and material with which the photography is done, can be separated from the photography service then both the elements cannot be remixed for the purposes of service tax particularly when the VAT is levied on the material, consumables and chemicals which are used in the photography service.
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