Nagar Panchayat Khamano Vs Commissioner of Central Excise & Service Tax (CESTAT Chandigarh)
Summary: The Chandigarh Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) allowed three appeals filed by Nagar Panchayat, Khamano, Fatehgarh Sahib, Punjab, challenging orders passed by the Commissioner (Appeals), CGST, Chandigarh. The appeals arose from Order-in-Appeal Nos. LUD-EXCUS-001-APP-1059-18 dated 26.04.2018, LUD-EXCUS-001-APP-885-18 dated 28.03.2018 and LUD-EXCUS-001-APP-886-18 dated 28.03.2018.
The appellant, Nagar Panchayat, had provided shelters/empty spaces with toilet facilities enabling bus operators to stop their buses so that passengers could alight and board. The Nagar Panchayat collected “Adda Fees” from the bus operators. The Revenue considered these receipts to be consideration towards “Business Support Services” provided by the Nagar Panchayat to the bus operators and issued three show cause notices proposing recovery of service tax along with interest and penalty. The original authority and the appellate authority confirmed the proposals, resulting in the three appeals before CESTAT.
Before the Tribunal, the appellant submitted that the facilities had been created for the public in discharge of its functions under Article 243W of the Constitution of India read with Sl. No. 17 of the Twelfth Schedule to the Constitution. It was further submitted that the District Magistrate fixes the Adda Fee from time to time under Rule 200(3) of the Punjab Motor Vehicles Rules, 1989.
