Varad Vinayak Gardens Vs Commissioner of Service Tax – VI (CESTAT Mumbai)
CESTAT Mumbai held that taxing entirety of income as consideration under ‘management, maintenance or repair service’ without disaggregating consideration among several activities is lack of wherewithal. Accordingly, order set aside and matter remanded back.
Facts- Appellant-assessee had entered into a contract with the Municipal Corporation of Greater Mumbai for establishment and upkeep of gardens, including safety and security of the premises, on which tax liability had not been discharged. Appeal of M/s Varad Vinayak Gardens contests confirmation of demand on the ground that the service connected with fabrication and civil/electrical works were exempted by notification after 1st July 2012, that, even before 1st July 2012, horticulture and allied activities were not liable to be charged to tax, that demand of tax for rendering of ‘security services’ traversed beyond the scope of ‘taxable service’ proposed in the show cause notice for the ‘pre-negative list era’ and that the value of goods supplied in the course of rendering service was not liable to be included in taxable value.
Conclusion- In the absence of examination of the bills raised by the assessee on Municipal Corporation of Greater Mumbai (MCGM) details, obtainable from the assessee, recourse to the shortcut, transcending the intent of law, is incomplete adjudication. More so, as the adjudicating authority has applied the ‘vanilla variant’ of ‘management, maintenance or repair service’ as the benchmark for taxing activities that were premised to be inseparable without a finding on the appropriateness, or otherwise, of resort to the specific provision of section 65A of Finance Act, 1994.
