2015 (8) TMI 398 - AT - Service Tax

Service tax liability impacted by Notification No.45/2010-ST exemptions

The appeals were allowed to the extent that the appellant was not required to pay service tax on the majority of the demand confirmed by the order, except ... Erection, Commissioning or Installation service - Exemption under Notification No.45/2010-ST dated 20.7.2010 - Held that:- Notification No.45/2010-ST dated 20.7.2010 was issued by the Central Government in exercise of powers passed under Section 11C of the Central Excise Act, 1944 read with Section 83 of the Finance Act, whereby taxable services relating to transmission and distribution of electricity provided by a service provider to a service receiver for the period upto 21.6.2010 was exempted from service tax. - appellant is not liable to collection of service tax in terms of Notification No.45/2010-ST on the entirety of the demand confirmed by the order impugned, except demand of service tax, interest and penalty on the tax components of ₹ 23,562/- and ₹ 34,437 - Decided partly in favour of assessee. Issues:1. Confirmation of cumulative demand by the Commissioner, Customs, Central Excise, and Service Tax, Bhopal.2. Validity of demand for service tax, interest, and penalties on consultancy services and unremitted service tax.3. Applicability of Notification No.45/2010-ST on transmission and distribution of electricity services.4. Liability of the appellant for service tax on specific components of the demand.Confirmation of Cumulative Demand:The appeals were filed against an adjudication order confirming a cumulative demand of Rs. 1,03,58,984/- by the Commissioner, Customs, Central Excise, and Service Tax, Bhopal. The demand included service tax, interest, and penalties as specified in the order. The appellant did not contest the demand related to consultancy services and unremitted service tax, which were confirmed. The remaining balance of the demand stemmed from the provision of Erection, Commissioning, or Installation services by the appellant for the Madhya Pradesh State Electricity Board through its instrumentality.Validity of Demand for Service Tax and Penalties:The demand for service tax, interest, and penalties on consultancy services and unremitted service tax was upheld. However, considering Notification No.45/2010-ST issued by the Central Government, which exempted taxable services related to transmission and distribution of electricity provided by a service provider to a service receiver until a specified date, the appellant was found not liable to collect service tax on the majority of the confirmed demand. The exemption under the notification applied to the entirety of the demand except for specific tax components.Applicability of Notification No.45/2010-ST:Notification No.45/2010-ST played a crucial role in determining the liability of the appellant for service tax on the transmission and distribution of electricity services provided to the Madhya Pradesh State Electricity Board. The notification exempted such services from service tax up to a certain date, which influenced the decision on the appellant's liability for the demand.Liability of the Appellant for Specific Components:Ultimately, the appeals were allowed to the extent that the appellant was not required to pay service tax on the majority of the demand confirmed by the order, except for the specific tax components of Rs. 23,562/- and Rs. 34,437/-. The decision highlighted the impact of the notification on the appellant's liability and clarified the scope of the exemption provided under the relevant regulations. No costs were awarded in the matter.