2026-VIL-1261-CESTAT-KOL-ST
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SERVICE TAX CESTAT Cases

Service Tax – Taxability of Cleaning Service provided to Indian Railway - Appellant provided services of cleaning of railway station premises involving disinfection of platforms, tracks, and mechanised coach cleaning - Whether such services fall under the category of cleaning service as defined in Section 65(24b) of Finance Act, 1994 and are chargeable to service tax - HELD - Services of cleaning do not fall under the category of cleaning service as the same were not rendered to a commercial concern. The definition of cleaning activity under Section 65(24b) applies only to cleaning rendered in respect of commercial or industrial buildings and premises or factory, plant or machinery of such commercial or industrial buildings - Indian Railways is a Government of India organisation meant for welfare of general public and cannot be called as a commercial concern as its operations of passenger transportation are not done with profit motive. Railway coaches are rolling stock meant for transport mode and cannot fall under commercial objects of industrial building, factory, plant or machinery - A taxing statute must be strictly interpreted and if someone gets out of tax net because of the way the taxing statute has been drafted, this cannot be remedied through judicial or quasi judicial order - Further, for period post 01.07.2012, services are exempt from service tax as per Entry 25 of Notification 25/2012-ST which exempts services ordinarily rendered by municipality such as public health, sanitation conservancy and solid waste management when provided to Government - The demand for cleaning service is set aside and the appeal is allowed - Service Tax - Business Auxiliary Service - Appellant rendered On-Board House-keeping Service involving cleaning and disinfection of toilets, bedroll distribution etc to Indian Railways and was charged service tax under BAS category - Whether such services are exempt from service tax under Entry 25 of Notification 25/2012-ST dated 20.06.2012 - HELD - Services rendered by appellant in the nature of on-board housekeeping service involving cleaning and disinfection are in the nature of public health, sanitation conservancy and solid waste management. Entry 25 of Notification 25/2012-ST exempts all such services which are rendered to Government as the same are otherwise exempted from service tax when rendered by a municipality - The services rendered by appellant are squarely covered within the ambit of Entry 25 of Notification 25/2012-ST. For period prior to 01.07.2012, the extended period of limitation cannot be invoked as the same issue was raised earlier in a prior SCN dated 11.10.2012 for period 2007-08 to 2011-12 and was finally decided in favour of appellant and the department was well aware of the activities - Once a show cause notice has been issued alleging suppression of facts, extended period cannot be invoked again on the very same issue to demand service tax for subsequent period - The demand for BAS for both periods is not sustainable and set aside.
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