The Commissioner, CGST And Central Excise Commissionerate vs. M/S Bilfinger Neo Structo Construction LTD.

Held

The High Court held that both Tax Appeal No. 2332 of 2010 and F/Tax Appeal No. 2258 of 2020 were not maintainable before it. The learned Standing Counsel for the Excise Department pointed out Section 35L(b) of the Central Excise Act, 1944, which stipulates that an appeal shall lie to the Supreme Court from any order passed by the Appellate Tribunal before the establishment of the National Tax Tribunal, relating to the determination of any question having a relation to the rate of duty of excise or to the value of goods for the purpose of assessment. The Court accepted the submission that the impugned orders of the Tribunal related to the rate of duty of service tax, making the appeal exclusively within the jurisdiction of the Supreme Court. Consequently, the appeals were disposed of as not maintainable, with liberty granted to the appellant to take appropriate steps before the appropriate forum. The Court explicitly stated that no opinion was expressed on the merits of the substantial questions of law involved. Civil Application No. 1578 of 2020 was also disposed of as consequential.

Facts

The Commissioner, CGST and Central Excise, Gujarat, filed Tax Appeal No. 2332 of 2010 and F/Tax Appeal No. 2258 of 2020 before the Gujarat High Court. These appeals challenged orders passed by the Customs Excise and Service Tax Appellate Tribunal (CESTAT) dated April 26, 2010, concerning service tax liability. The appeals were admitted on two substantial questions of law. The core dispute revolved around whether the respondent's activity constituted fabrication of structures not covered under "erection of plant, machinery, or equipments" and whether it was a manufacturing activity under the Central Excise Act, thus exempting it from service tax. The High Court was informed that the CESTAT's impugned judgment was based on an earlier Tribunal judgment.

Key Issues

1. Whether the Tribunal committed a substantial error in holding that the respondent's activity was fabrication of structures not covered under the expression "erection of plant, machinery, or equipments," and therefore not exigible to service tax prior to May 1, 2006, under Section 65(39a) of the Finance Act, 2004. 2. Whether the Tribunal committed a substantial error of law in holding that the respondent's activity is covered under Section 2(f) of the Central Excise Act as a manufacturing activity, and thus the respondent is not liable to pay service tax under the category of "Erection Commissioning and Installation Service." Petitioner's Arguments (Commissioner, CGST and Central Excise): The petitioner argued that the Tribunal erred in its findings regarding the nature of the respondent's activity and its taxability. The petitioner contended that the activity was indeed exigible to service tax and did not fall under the manufacturing exemption. The petitioner relied on the substantial questions of law framed for the appeal. Respondent's Arguments (M/s Bilfinger Neo Structo Construction Ltd.): The judgment does not record any specific arguments made by the respondent. The focus of the hearing shifted to the maintainability of the appeals.