Service Tax Demand cannot be made under two heads for same service: CESTAT Directs Re-adjudication of Service Tax Demand under ‘Architect’ and ‘Interior Decorator Service’ [Read Order]

The Ahmedabad bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) directed re-adjudication to the adjudicating authority on service tax demand which was raised under the two heads as ‘architect’ and ‘Interior Decorator Service’. 

City Pulse Media India Ltd, the appellant assessee appealed against the order passed by the Commissioner (Appeals) for confirming the Service Tax liability primarily under two heads i.e. amounting to Rs. 7,07,945/- had been confirmed under architect service, and a demand of Rs. 4,437/- has been confirmed for sale of space for advertisements services. 

Pravin Dhandhaira, the counsel for the assessee contended that the Order-in-Original had demanded the service tax from the assessee under two categories namely “Architect Service” and “Interior Decorator Service” which was legally not permissible. 

It had further been contended that the show cause notice should have given a clear-cut classification of the category of service under which the department wanted to classify the services that had been rendered by the assessee and the show cause notice demanding service tax for the same work under two different categories of the service was legally not sustainable. 

Anup Kumar Mudvel, the counsel for the department contended that the assessee had neither taken any registration under the appropriate service category for payment of Service Tax nor paid any Service Tax on the value of Service provided by them. 

The Bench observed that while the show cause notice, based on information received from the service recipient especially from Saumya Construction Pvt. Ltd had claimed that the assessee had been providing the service of “Architect” and “Interior Decorator Service” and at the same time the Commission mer had confirmed the demand for Service Tax only under the category of Architect service. 

Also observed that the department had not verified all the facts before issuing a show cause notice in this case and the adjudicating authority while deciding the show cause notice had decided the matter only based on information provided by Saumya Construction Pvt. Ltd. 

The two-member bench comprising Ramesh Nair (Judicial) and C L Mahar (Technical) remanded back the matter to the original adjudicating authority to decide the matter a fresh after giving a proper opportunity to the assessee in producing their books of account, invoices, contract, work order, etc so that the factual portion regarding the category of the service provided by the assessee can be determined. 

To Read the full text of the Order CLICK HERE

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