Abatement for erection and commissioning services denied where the customer supplied the equipment and the provider only installed it.

Abatement under Notification No. 19/2003-ST and Notification No. 1/2006-ST for erection, commissioning or installation services was unavailable where the customer supplied the plant, machinery and major equipment, and the service provider rendered only erection and commissioning work. The invoices showed supply of only minor consumables by the provider, so the contractual and factual conditions for the abatement were not met. The Tribunal therefore sustained denial of the benefit and upheld the order against the assessee.

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Issues: Whether the appellant was entitled to abatement of 67% under Notification No. 19/2003-ST dated 21.08.2003 and Notification No. 1/2006-ST dated 01.03.2006 in respect of erection, commissioning or installation services.

Analysis: The contract conditions showed that the plant, machinery and major equipment were supplied by the customer, while the appellant undertook only erection and commissioning work. The invoices also reflected supply of minor consumables and not of plant, machinery or major equipment by the appellant. On this factual basis, the conditions for availing abatement under the notifications were not satisfied. The Tribunal therefore found no ground to interfere with the order denying the benefit.

Conclusion: The appellant was not entitled to abatement under the said notifications, and the denial of the benefit was sustained against the assessee.

Final Conclusion: The appeal failed and the impugned order denying abatement was upheld.

Ratio Decidendi: Abatement under the cited notifications is available only where the contract involves supply of plant, machinery or equipment by the service provider in addition to erection, commissioning or installation; where the customer supplies the equipment and the provider renders only installation-related work, the benefit is unavailable.

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