By TIOL News Service

BANGALORE, JAN 30, 2014: THE respondent is engaged in providing the following services:

(i) Original Research Activities:

a) Product Chemistry,

b) Environmental Studies

c) Toxicology Studies;

d) Physic-Chemical Properties

e) Environmental fate Studies and all guidelines issued by organization for Economic cooperation and development and guidelines issued by Environment Protection Agency (EPA)

(ii) Sponsored Research Activities.

A show cause notice was issued to the respondent on 26.03.2004 categorising the respondent as a service provider of Scientific and Technical consultancy. The Deputy Commissioner of Central Excise, Bangalore I Commissionerate , Bangalore demanded service tax amount of Rs.12 ,91,095 /- for the period from 16.07.2001 to 31.08.2003 @ 5% up to 13.05.2003 and 8% from 14.05.2003 onwards. The original authority passed an order on 31.05.2004 dropping the proceedings on the ground that the 1st respondent is not rendering service. Aggrieved by the same, the appeal came to be filed by the Department, which appeal came to be allowed against which, an appeal was filed before the Tribunal. The Tribunal relying upon the judgment in the case of Commissioner of Service Tax Vs. Central Power Research Institute (2006-TIOL-1131- CESTAT-BANG) allowed the appeal and set-aside the order passed by the Appellate Authority.

Revenue is in appeal before the High Court.

On perusal of the order passed by the Tribunal, the High Court was of the opinion that the Tribunal has allowed the appeal of the respondent relying upon the judgment in Central Power Research Institute without discussing the facts of the present case and no finding has been given whether the respondent is a service provider or not in order to give benefit of the judgment in Central Power Research Institute . Therefore, when the Tribunal without application of mind and without considering the facts involved thereunder, has rendered judgment, the same has to be set aside and requires to be reconsidered by the Tribunal afresh.

Thus, the High Court allowed the Revenue appeal and without answering the substantial question of law, the matter is remanded to the Tribunal for fresh consideration. Since the subject matter of the appeal is old, the Tribunal is directed to dispose of the matter within four months from the date of service of notice on the respondent.

(See 2014-TIOL-119-HC-KAR-ST)