IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT AHMEDABAD
M/s Bharuch Enviro Infrastructure Ltd. & M/s Enviro Technology Ltd. Vs CCE Surat II
MRS. ARCHANA WADHWA, MEMBER (JUDICIAL)
MR. B.S.V. MURTHY, MEMBER (TECHNICAL)
Date of Hearing: 29.07.08
Date of Decision: 29.07.08
ORDER No. /WZB/AHD/2008
Per: Mrs. Archana Wadhwa, Member (Judicial)
After dispensing with the condition of pre-deposit of duty and penalty in both the cases, we proceed to decide the appeals themselves, in as much the disputed issue, prima facie, seems to be covered by Boards letter from F.No.137/111/2007-CX.4, dt.13.7.07.
2. After hearing both sides, we find that the service tax stand confirmed against the applicant under the category of business auxiliary service on the activity undertaken by them in respect of disposal of waste received from various industries.
3. The appellants are engaged in treatment and disposal of waste which includes stabilization, neutralization or incineration of waste received from various industries.
4. The learned advocate at this stage has brought to our notice a letter written by Commissioner of Service Tax from the Ministry of Finance, Central Board of Excise & Customs, addressed to Director General, DGCEI, New Delhi, dated 13.7.07. For better appreciation, we reproduce Para 3 of the said letter.
The matter has been examined by the Board. The view of the Board is that the incineration/shredding of bio-medical waste can, by no stretch of imagination, be called as processing of goods, even if in certain cases the shredded materials may be used as fillers etc. Further, the activity also does not qualify to be called as provision of service on behalf of the client. This is because, the taxable activity envisaged under this category of business auxiliary service is that while the client is obliged to provide some service to a 3rd person but instead of the client providing such service, the service provider provides such service to the 3rd person, on behalf of the client, i.e. acting as an agent of the client. Admittedly, in the instant case, there is no 3rd person. Thus, the activity so undertaken does not fall under business auxiliary service or any other existing taxable services.
5. The first part of the said paragraph shows that the treatment of bio-medical waste incineration/shredding has been held as not covered by the category of business auxiliary service. The second part of the said paragraph is to the effect that such activity undertaken by the assessee is not leviable to service tax in as much as the same cannot be said to have been provided on behalf of the client in as much as there is no 3rd person involved to whom assessees client is liable to provide any service. While agree with the first part of the above paragraph, we do not agree, prima facie, with the second part of the said paragraph, , in as much as the definition of business auxiliary service was amended w.e.f. June05 extending the scope of the same to the services undertaken on behalf of and for the client. We, however, find some force in the first part of the above paragraph. In as much as the said letter was not produced before Commissioner, we would like him to pass a fresh order in the light of the Boards interpretation. If need be, a clarification may be sought by the adjudicating authority from Board. Appellant is at liberty to raise all the contentions before the adjudicating authority in de-novo proceedings.
6. Apart from the above, a part of the demand in the case of M/s Enviro Technology stands confirmed on the ground of service tax to be levied on Goods Transport Agency Services. We find that Commissioner has not dealt with the appellants stand and pleas on the said issue. As the matter is being remanded on the first issue, the Commissioner, in remand adjudication would pass fresh orders on the above point also.
7. Appeals are allowed by way of remand. Stay petitions also get disposed off.