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Shiva Automobiles Private Ltd V/S Commissioner of Central Excise, Coimbatore


Company & Directors' Information:- SHIVA CORPORATION (INDIA) LIMITED [Active] CIN = U15532RJ1998PLC015036

Company & Directors' Information:- N E C C AUTOMOBILES PRIVATE LIMITED [Active] CIN = U74899DL1991PTC043600

Company & Directors' Information:- C M AUTOMOBILES PRIVATE LIMITED [Active] CIN = U50300CH2005PTC028233

Company & Directors' Information:- J P M AUTOMOBILES LIMITED [Active] CIN = U74899DL1995PLC068910

Company & Directors' Information:- K N AUTOMOBILES PRIVATE LIMITED [Active] CIN = U50404OR2013PTC016730

Company & Directors' Information:- J AND K AUTOMOBILES PRIVATE LIMITED [Active] CIN = U50401JK2004PTC002447

Company & Directors' Information:- K. S. AUTOMOBILES PRIVATE LIMITED [Active] CIN = U50300RJ2009PTC028204

Company & Directors' Information:- K N R AUTOMOBILES PRIVATE LIMITED [Active] CIN = U50300WB2006PTC111199

Company & Directors' Information:- SHIVA AUTOMOBILES PRIVATE LIMITED [Active] CIN = U03410TZ1989PTC004023

Company & Directors' Information:- CENTRAL AUTOMOBILES PRIVATE LIMITED [Active] CIN = U99999MH1952PTC008750

Company & Directors' Information:- K P AUTOMOBILES PRIVATE LIMITED [Active] CIN = U50404JH2012PTC000824

Company & Directors' Information:- Y J AUTOMOBILES PRIVATE LIMITED [Active] CIN = U50401MP2013PTC031920

Company & Directors' Information:- N S AUTOMOBILES PRIVATE LIMITED [Active] CIN = U50102MH2012PTC226814

Company & Directors' Information:- S K S AUTOMOBILES INDIA PRIVATE LIMITED [Strike Off] CIN = U50100TZ2009PTC014979

Company & Directors' Information:- J D AUTOMOBILES PVT. LTD. [Strike Off] CIN = U34300WB1987PTC042066

Company & Directors' Information:- B K AUTOMOBILES PRIVATE LIMITED [Active] CIN = U50200AP2009PTC064484

Company & Directors' Information:- N. K. AUTOMOBILES PRIVATE LIMITED [Active] CIN = U50102GJ2006PTC049307

Company & Directors' Information:- G M S AUTOMOBILES PRIVATE LIMITED [Active] CIN = U50101DL1997PTC089284

Company & Directors' Information:- N U AUTOMOBILES PVT LTD [Active] CIN = U74899DL1982PTC013126

Company & Directors' Information:- D K AUTOMOBILES PRIVATE LIMITED [Active] CIN = U29246CH1989PTC009607

Company & Directors' Information:- K Y AUTOMOBILES PRIVATE LIMITED [Active] CIN = U50400JK2021PTC012549

Company & Directors' Information:- A K AUTOMOBILES LIMITED [Amalgamated] CIN = U34100WB1984PLC038001

Company & Directors' Information:- A AND S AUTOMOBILES PRIVATE LIMITED [Strike Off] CIN = U51103DL1997PTC085147

Company & Directors' Information:- M. H. AUTOMOBILES PRIVATE LIMITED [Active] CIN = U50200HP2015PTC000946

Company & Directors' Information:- R. K. AUTOMOBILES PRIVATE LIMITED [Active] CIN = U74899DL1995PTC071719

Company & Directors' Information:- R. J. AUTOMOBILES PRIVATE LIMITED [Active] CIN = U50100BR2020PTC047409

Company & Directors' Information:- M R AUTOMOBILES (INDIA) PRIVATE LIMITED [Active] CIN = U34300DL1998PTC094488

Company & Directors' Information:- V. M. AUTOMOBILES PRIVATE LIMITED [Active] CIN = U35911UP1995PTC018136

Company & Directors' Information:- P D AUTOMOBILES PRIVATE LIMITED [Active] CIN = U50400RJ2021PTC074633

Company & Directors' Information:- SHIVA AUTOMOBILES PRIVATE LIMITED [Not available for efiling] CIN = U99999PY1989PTC000623

Company & Directors' Information:- A R AUTOMOBILES PRIVATE LIMITED [Strike Off] CIN = U50404PY2011PTC002555

Company & Directors' Information:- K P V AUTOMOBILES PVT LTD [Active] CIN = U50300KL1991PTC006035

Company & Directors' Information:- J B S AUTOMOBILES PRIVATE LIMITED [Strike Off] CIN = U34101OR2005PTC008397

Company & Directors' Information:- S. N. S. AUTOMOBILES PRIVATE LIMITED [Active] CIN = U50500WB2018PTC224868

Company & Directors' Information:- COIMBATORE AUTOMOBILES PRIVATE LIMITED [Active] CIN = U01131TN1989PTC017651

Company & Directors' Information:- M P AUTOMOBILES PVT LTD [Strike Off] CIN = U50404MP1957PTC000842

Company & Directors' Information:- THE CENTRAL AUTOMOBILES LTD [Strike Off] CIN = U34300KA1950PLC000670

Company & Directors' Information:- G. E. AUTOMOBILES PRIVATE LIMITED [Active] CIN = U50400DL2018PTC341171

Company & Directors' Information:- P K AUTOMOBILES PVT LTD [Strike Off] CIN = U50300UP1979PTC004841

Company & Directors' Information:- P L AUTOMOBILES PRIVATE LIMITED [Active] CIN = U50300RJ2014PTC046516

Company & Directors' Information:- S G K R AUTOMOBILES PRIVATE LIMITED [Active] CIN = U60210TN1960PTC004283

Company & Directors' Information:- N R AUTOMOBILES PRIVATE LIMITED [Strike Off] CIN = U50400MH2014PTC255882

Company & Directors' Information:- S. N. J. AUTOMOBILES PRIVATE LIMITED [Active] CIN = U50400MH2017PTC299238

Company & Directors' Information:- M R K AUTOMOBILES PRIVATE LIMITED [Strike Off] CIN = U50102UP2011PTC045868

Company & Directors' Information:- I B AUTOMOBILES PRIVATE LIMITED [Strike Off] CIN = U29253DL2008PTC172205

Company & Directors' Information:- T K AUTOMOBILES PRIVATE LIMITED [Active] CIN = U74899DL1984PTC017940

Company & Directors' Information:- V R AUTOMOBILES PRIVATE LIMITED [Active] CIN = U34200DL2007PTC170076

Company & Directors' Information:- K T AUTOMOBILES PVT LTD [Strike Off] CIN = U99999UP1959PTC002730

Company & Directors' Information:- M B AUTOMOBILES PVT LTD [Strike Off] CIN = U35923WB1966PTC026743

Company & Directors' Information:- B M AUTOMOBILES PRIVATE LIMITED [Strike Off] CIN = U50200DL2007PTC162611

Company & Directors' Information:- H A AUTOMOBILES PRIVATE LIMITED [Strike Off] CIN = U34102DL2007PTC163030

Company & Directors' Information:- P A AUTOMOBILES PRIVATE LIMITED [Strike Off] CIN = U34101DL2007PTC161483

Company & Directors' Information:- K G AUTOMOBILES PRIVATE LIMITED [Strike Off] CIN = U34200DL2007PTC162859

Company & Directors' Information:- P R AUTOMOBILES PRIVATE LIMITED [Strike Off] CIN = U34201DL2007PTC161053

Company & Directors' Information:- SHIVA AND CO PVT LTD [Strike Off] CIN = U51909KL1934PTC001030

Company & Directors' Information:- AUTOMOBILES PVT. LTD. [Strike Off] CIN = U99999DL2000PTC000916

    Appeal No. ST/75/2012 (Arising out of Order-in-Appeal No. CMB-CEX-000-APP-207-11 dt. 21.11.2011 passed by Commissioner of Customs, Central Excise & Service Tax (Appeals), Coimbatore) and Final Order No. 41429/2018

    Decided On, 02 May 2018

    At, Customs Excise Service Tax Appellate Tribunal South Zonal Bench At Chennai

    By, THE HONORABLE JUSTICE: SULEKHA BEEVI C.S.
    By, MEMBER AND THE HONORABLE JUSTICE: MADHU MOHAN DAMODHAR
    By, MEMBER

    For Petitioner: S. Yogalakshmi, Advocate And For Respondents: K.P. Muralidharan, AC (AR)



Judgment Text


1. The brief facts of the case are that the appellant is an authorized service dealer of Mahindra & Mahindra (hereinafter referred to as manufacturer) and is engaged in sale and service of motor vehicles. On the basis of arrangement with manufacturer, in respect of vehicles sold by manufacturer either directly or through authorized dealers, appellants provided warranty services free of cost to the customers which includes both provision of service as well as use of spares and consumables. The labour charges are paid by manufacturer and the value of spares and consumables are being reimbursed. The appellant is discharging service tax on labour charges at appropriate rate. The department was of the view that the value of spares parts and consumables used during free replacement/warranty services are also includable in the total taxable value for discharging service tax. Accordingly, show cause notice was issued proposing to demand the service tax along with interest and also for imposing penalties. After due process of law, the original authority confirmed the demand but however dropped the penalty imposed under Section 76 of Finance Act, 1994. In appeal, Commissioner (Appeals) upheld the same. Aggrieved, the appellant is now before the Tribunal.

2. On behalf of the appellant, Ld. Counsel Ms. Yogalakshmi submitted that activity of the appellant involves both provision of service as well as sale of goods. The appellant has correctly discharged service tax on labour charges collected from the manufacturer on warranty replacement works. The value of spares/parts/component replaced is recovered from manufacturer with applicable VAT/CST. The transaction in relation to spares and parts is sale of goods and the appellants having discharged VAT on such goods is not liable to pay service tax on such amount. The CBEC in Circular No. 96/7/2007-ST dt. 23.08.2007 has clarified that when a transaction is treated as sale of goods and subjected to levy of sales tax, the same cannot be subjected to levy of service tax. Further these expenses are reimbursed by the manufacturer and such reimbursable amounts are not subject to levy of service tax as laid down by the Hon'ble Court in the case of Intercontinental Consultants and Technocrafts Pvt. Ltd. Vs. UOI - 2012-TIOL-966-HC-DEL : 2013 (29) STR 9 (Del). Ld. Counsel also relied upon the decision in the appellant's own case vide Final Order No. 40602/2016 dt. 06.04.2016 as well as the decision passed in the case of ABT Ltd. & Others Vs. CCE Coimbatore vide Final Order No. 40618-40628/2018 dt. 14.03.2018.

3. Ld. A.R. Shri K.P. Muralidharan reiterated the findings in the impugned order.

4. Heard both sides. The issue that arises for consideration is whether the appellants are liable to pay service tax on the value of spares/parts on which VAT has been discharged. The said dispute has been considered by the Tribunal in the appellant's own case cited supra as well as in ABT Ltd. & Others Vs. CCE Coimbatore. The relevant portions are noticed in the case of ABT Ltd. as under:

"5. After considering the submissions made by both sides as well as perusal of records, we find that the service tax demand has been raised by Revenue on the cost of spare parts used while rendering the warranty as well as extended warranty service. After a perusal of some of the sample invoices raised for such work, we note that the spare parts have in fact been sold on payment of VAT. Consequently, we are of the view that the cost of spare parts cannot be included for purposes of levy of service tax. Such demand of service tax is not justified and hence are set aside.

6. In respect of amounts recovered by way of extended warranty premium, we note that there is no justification to consider such amounts as reimbursements of the cost of spares by the manufacturers of motor vehicles. The extended warranty premium amounts are liable to payment of service tax under the appropriate category of service but it stands submitted that the s

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ervice tax demand thereon has been paid by the manufacturers of motor vehicles to whom such premium has been transferred. Consequently, we find no justification for demand of service tax of such amounts which are also set aside." Following the same, we are of the view that the demand cannot sustain and requires to be set aside. In the result, impugned order is set aside and appeal is allowed with consequential relief, if any, as per law.
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