By TIOL News Service

MUMBAI, APR 18, 2015 : THE appellant is engaged in running a plant for treatment of effluent generated in the industrial area of Butibori at Nagpur. It is the case of the Revenue that the said services would fall under 'Business Support Services' as they are rendering services of industrial waste water treatment and removal of sludge from the industries operating in Butibori Industrial Area, Nagpur.

Resultantly, a Service Tax demand was confirmed for the period April, 2006, to September, 2007.

Before the CESTAT, the appellant submitted that the issue is now squarely settled by the retrospective amendment by Section 145 of the Finance Act, 2012. Inasmuch as retrospective exemption is granted from 16.06.2005 to club or association including co-operative societies in relation to project (project means common facility set-up for treatment and recycling of effluents and solid wastes, with financial assistance from the Central Government or a State Government).

It is further submitted that Butibori CETP Pvt. Ltd. is funded by the Central Government as well as by the State Government in support of which they produced statements (status of CEPT in Maharashtra as on 23/02/2015) from the website of Maharashtra Pollution Control Board and drew the attention of the Bench to the fact that Butibori CEPT Pvt. Ltd. is funded by Central Government as well as State Government through MPCB. The appellant also submitted that an identical issue has been decided by the Bench in the case of Lote Parshuram Environment Protection Co-op Society Ltd. vs. Commissioner of Central Excise, Kolhapur, 2012-TIOL-1741-CESTAT-MUM.

The AR had nothing more to add except reiterate the findings of the lower authorities.

The Bench observed -

"6. …, we do not find that the demand confirmed against the appellant under the category of 'Business Support Services' for operating the effluent treatment plant which has been established under CETP Project, is sustainable in law. We find that the Maharashtra Pollution Control Board in their website has clearly stated that the appellant has been funded by the Central Government as well as the State Government through MPCB for setting up the Butibori CETP Plant. We also find strong contentions as raised by the learned counsel that the retrospective amendment and brought in statute by Section 145 of the Finance Act, 2012 (Act no. 23 of 2012) would squarely cover the issue; as also the ratio laid down by this Bench in the case of Lote Parshuram Environment Protection Co-op Society Ltd. (supra)."

Holding that the impugned order is not sustainable, the same was set aside and the appeal was allowed with consequential relief.

(See 2015-TIOL-700-CESTAT-MUM)