KUTTUKARAN TRADING VENTURES Vs. COMMISSIONER OF CENTRAL EXCISE, CUSTOMS AND SERVICE TAX
In the case of Commissioner Of Central Excise, Customs & Service Tax Kerala v/s M/s. Kuttukaran Trading Ventures, the Hon’ble Supreme Court held that the assessee was rightly entitled to exclusion of the service from service tax, as the assessee had themselves dismounted the engine and repaired it and then refitted it to the motor vehicle. Therefore, if any service centre or maintenance centre or workshop does maintenance or repairs to any part of the motor vehicle, it is also entitled to get the benefit of exclusion, as provided under Section 65(64) of the Finance Act, 1994.
A.M. Shaffique, J. – ( 1. ) THIS appeal is filed by M/s. Kuttukaran Trading Ventures, a partnership firm having three divisions. One such division is Kuttukaran Engine Rebuilders which carries on the business of general automobile repair including engine reconditioning, engine parts repair and repair of vehicles and other vehicle parts as well. The appellant was served a letter dated 05/12/2007 by the Superintendent (Audit) inter alia stating that the appellant was not paying service tax on the income received from the Customers for reconditioning of motor vehicle engines/repairing vehicle engines and other parts on the ground that the said service does not amount to reconditioning/repairing of motor vehicles which is excluded from the purview of ‘Maintenance and Repair service’. The appellant controverted the said stand on the ground that the activity of rebuilding or repair of engines and other parts of motor vehicles inter alia means maintenance or repair service of motor vehicles, and excluded from the purview of service tax liability.
( 2. ) HOWEVER , without accepting the explanation offered by the appellant, they were imposed with service tax for an amount of Rs. 67,28,530/ – for the period from 16/06/2005 to 30/09/2007. It was inter alia alleged that there was deliberate suppression on the ground that the amount involved in respect of repair of motor vehicles/parts were not included in the returns and penalty was proposed. After hearing the appellant, the Commissioner of Central Excise confirmed the demand and the appellant was called upon to pay service tax with interest and penalty.
( 3. ) THE appellant preferred an appeal before the Customs, Excise and Service Tax Appellate Tribunal. ;