2015 (8) TMI 350 - AT - Service Tax

Tribunal exempts service tax on residential houses for Tsunami victims

The tribunal ruled in favor of the appellant in a case concerning service tax liability for constructing residential houses for Tsunami victims. It held ... Waiver of pre deposit - Construction of residential houses - Held that:- Appellant secured the contract for construction of residential houses for Tsunami victims from the Government of Tamil Nadu. On identical issue this Bench in the case of M/s. Jafty Earth Movers and contractors Ltd.(2013 (2) TMI 133 - CESTAT CHENNAI) granted waiver of pre-deposit by relying the Tribunals decision in the case of Macro Marvel Projects Ltd. (2008 (9) TMI 80 - CESTAT, CHENNAI), which has been confirmed by the Honble Supreme Court [2009 (7) TMI 1222 - SUPREME COURT]. Whereas the Revenue relied upon the decision in the case of PSK Engineering Constructions & Co. (supra), wherein pre-deposit has been ordered. - houses constructed for Tsunami victims are individual houses and not a housing complex. Further, in the case of PSK Engineering Constructions & Co. (supra) no reference has been made to the decision of Macro Marvel Projects Ltd. (supra). Considering the above facts and also considering that two decisions of this Bench are in favour of the assessee and taking into account of the judgment of the Hon’ble Supreme Court in the case of Macro Marvel Projects Ltd. (supra) the appellant has made out a prima facie case in their favour for waiver of pre-deposit. Accordingly, stay is granted till disposal of the appeal - Stay granted. Issues:1. Service tax liability for construction of residential houses for Tsunami victims.2. Applicability of service tax on individual houses built for Tsunami victims.3. Interpretation of housing complex vs. individual houses in relation to service tax liability.4. Pre-deposit waiver based on previous judicial decisions.Analysis:1. The adjudicating authority demanded service tax and imposed a penalty for constructing residential houses for Tsunami victims. The appellant argued that the construction was for individual houses, not a residential complex, and thus exempt from service tax. The appellant cited relevant case laws to support their position.2. The respondent contended that the construction involved more than 12 units for Tsunami affected people, and service tax was not paid or registered. The respondent relied on a specific case law to support their argument.3. Upon review, the tribunal found that the houses constructed for Tsunami victims were individual houses, not part of a housing complex. The tribunal considered previous decisions favoring the appellant, where waiver of pre-deposit was granted based on similar circumstances. The tribunal noted the absence of reference to a relevant case law in the respondent's argument.4. Considering the appellant's prima facie case in their favor, the tribunal granted a stay on the pre-deposit requirement until the appeal's disposal. The decision was based on the interpretation of the construction project, previous judicial decisions, and the nature of the houses built for Tsunami victims.This detailed analysis highlights the key legal issues, arguments presented by both parties, relevant case laws cited, and the tribunal's reasoning leading to the decision to grant a stay on the pre-deposit requirement.