Sale of spare parts and lubricants during servicing or repairing of motor vehicles by Authorized Service Station is not chargeable to Service tax
Tanya Automobiles Pvt. Ltd. Vs. Commissioner of Central Excise and Service Tax, Meerut – I [2016-TIOL-166-CESTAT-ALL]
Tanya Automobiles Pvt. Ltd. (“the Appellant”) was an Authorized Service Station of motor vehicles providing servicing or repairing services. The Appellant was showing the sale of spare parts and lubricants separately in invoice on which VAT/Sales tax has been paid and on service components & labour charges, Service tax was paid. The Department alleged that spare parts or consumables are consumed during the servicing of the motor vehicles and therefore Service tax is to be discharged on entire amount of billing including the value of spare parts.
Period Involved: October, 2006 to December, 2011
The Hon’ble CESTAT, Allahabad relying upon the judgment in the case of Samtech Industries Vs. Commissioner of Central Excise, Kanpur [2014 (4) TMI 995 - CESTAT NEW DELHI], which was subsequently upheld by the Hon'ble High Court of Allahabad [2014 (8) TMI 1023 - ALLAHABAD HIGH COURT] held that in the instant case, there is documentary proof specifically indicating value of the goods supplied/sold on which VAT/Sales tax has been paid, hence the demand of Service tax from the Appellant for the value of goods supplied during repair does not appear sustainable.