Jurisdiction based on location in service tax dispute. Focus on tax payment verification.

The court found that the Commissioner of Service Tax, New Delhi had jurisdiction over the proceedings due to the appellant's location in Delhi. It clarified that the key issue was whether the collected service tax was deposited with the government, regardless of whether it was done directly by the appellant or through contractors. The court remanded the case for verification of the service tax amounts collected and paid, stating that if the appellant's claims were confirmed, no demand or penalty would be imposed.

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Issues Involved:
1. Jurisdiction of the Commissioner of Service Tax, New Delhi.
2. Applicability of Section 73A of the Finance Act, 1994.
3. Responsibility for depositing collected service tax with the government.
4. Verification of the amount of service tax collected and paid.

Issue-wise Detailed Analysis:

1. Jurisdiction of the Commissioner of Service Tax, New Delhi:
The appellant argued that since the flats were constructed in Indirapuram, Ghaziabad, the Commissioner of Service Tax, New Delhi, lacked jurisdiction to initiate proceedings. The court found that the appellants were based in Delhi, and the dispute was about the collection and non-deposit of service tax, not the construction activity itself. Thus, the proceedings had to be initiated by officers with jurisdiction over the appellant's location in Delhi. The court found no merit in the appellant's jurisdictional challenge.

2. Applicability of Section 73A of the Finance Act, 1994:
Section 73A mandates that any person who collects an amount representing service tax must pay it to the credit of the Central Government. The court noted that the appellant collected service tax from customers and reimbursed it to contractors, who then deposited it with the Revenue. The court emphasized that the critical issue was whether the collected service tax was deposited with the government, either directly by the appellant or through contractors.

3. Responsibility for Depositing Collected Service Tax with the Government:
The adjudicating authority contended that the appellant should have deposited the collected service tax directly with the Revenue. The court disagreed, stating that as long as the service tax collected from buyers was deposited with the government-whether by the appellant or the contractors-the requirement was fulfilled. The court held that the Revenue could not demand the same service tax twice for the same construction activity.

4. Verification of the Amount of Service Tax Collected and Paid:
The appellant claimed that they collected approximately Rs. 3.24 crores as service tax and paid around Rs. 3.48 crores through contractors. The adjudicating authority acknowledged these figures but did not verify them. The court remanded the case to the adjudicating authority to verify the appellant's claim. If verified, no demand or penalty would stand against the appellant.

Conclusion:
The court set aside the impugned order and remanded the matter for verification of the factual aspects regarding the service tax collected and paid. If the appellant's claims were verified, no demand or penalty would be imposed.

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