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PJ/Case Law/2013-14/1833

Cleaning services provided to Hospital is prima facie not leviable to service tax.

Case:- MANKESHWAR ENTERPRISES V/S COMMISSIONER OF CENTRAL EXCISE, PUNE
 
Citation:- 2013 (31) S.T.R. 503 (TRI.-MUM)

Brief Facts: - Brief facts of this case are that Applicant is seeking waiver of pre-deposit of Service Tax of Rs. 91,83,978/- along with interest and various penalties under the finance Act, 1994, which have been confirmed against them under the category of “Manpower Recruitment or Supply Agency Services””.

Appellant contentions:-  The ld. Counsel for the applicant submits that the activity undertaken by the applicant is squarely falls under the Cleaning Services under Section 65(105)(zzzd) of the Finance Act, therefore, the impugned demands are not sustainable.

Respondent contentions: - The Revenue is of the view that the said activity undertaken by the applicant falls under the category of Manpower Recruitment and supply agency Services, therefore, the impugned demands have been confirmed the applicant.

Reasoning of Judgment: -As per the agreement, the applicants are engaged in the Cleaning services of D.Y. Patil Medical Hospital and Research Institute. As per Section 65(105) of the finance Act, 1994 the Cleaning Service is taxable, if provided to any commercial or Industrial institution. We have seen that the cleaning Activities have been provided by the applicant to D.Y. Patil Medical Hospital & Research Institute, which is neither commercial nor a industrial institution. Therefore, the activity undertaken by the applicant is not taxable.
In view of these Observations, the applicant has made out a case for 100% waiver of pre-deposit of service Tax. Accordingly we waive the requirement of entire amount of pre-deposit adjudged in the impugned order and stay recovery thereof during the pendency of the appeal.
Decision:- Stay granted.
Comment:-The gist of the case is that cleaning services provided to a hospital is primarily not leviable to service tax as the said services are leviable to service tax if they are provided to any commercial or industrial institution. Accordingly, the stay application was allowed.

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