Order Date – 09 June 2023

Parties: Coal Mines Provident Fund Organization Vs Commissioner of Central Excise & Service Tax, Dhanbad

Facts – 

• The Appellant, Coal Mines Provident Fund Organization, is a creature of statute and is governed by the Coal Mines Provident Fund and Miscellaneous Provisions Act, 1948.
• For undertaking the various functions, the Appellant is entitled to recover administrative charges at the rate of 3% of the amount payable by the coal mine companies for managing the fund under the provisions of CMPF & MP Act.
• The demand was confirmed on administration charges recovered by the appellant under the head Banking and other Financial Services during the period up to June 2012 and under the category of ‘Service’ from July 2012 onwards when the negative list of services were introduced under the Finance Act, 1994.

Issue – 

• Whether the appellant is liable to pay service tax on administration charges recovered?

Order – 

• The Tribunal observed that the identical issue during the period prior to the period of dispute herein, the Tribunal in Appellant’s own case vide Misc. Order No. 75248/2022 dated 03.08.2022 passed in the M.A.(ROM) No. 75103 of 2022 inST Appeal No. 70470 of 2013 has held that no service tax is payable by the Appellant on administrative charges received by the Appellant under the provisions of CMPF & MP Act.
• In the said order it has also been held that the administrative charges in question is received by the appellant by way of operation of law to manage the fund for the benefit of coal mine workers and, therefore, the said administrative charges cannot be construed as “consideration” in the hands of the appellant.
• In the present case, since there is no service provider-service recipient relationship and further, in absence of ‘consideration’ which condition is a sine quo non as per the definition of service referred above, there is no case of rendition of service much less a ‘taxable service’. Hence, there does not arise any further need to examine the applicability of exemption notification.
• The appeals are allowed.