Rectification of Mistake Application Rejected for Service Tax Liability on Turnkey Projects

The Rectification of Mistake application regarding the liability for service tax on turnkey projects and works contract was rejected by the Tribunal. The Tribunal upheld its decision that the appellant was liable for service tax from 16-6-2005 under "erection, commissioning and installation services," denying the appellant's argument to be liable only from 1-6-2007 under works contract. The Tribunal emphasized that the findings were based on a thorough examination of the contract and advised the appellant to pursue normal appeal channels if they disagreed.

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Issues: Rectification of Mistake application regarding the liability for service tax on turnkey projects and works contract.

Analysis:
The appellant filed a Rectification of Mistake (ROM) application concerning the Final Order dated 12-2-2008, where they were treated as a "works contractor" for undertaking "Turnkey Projects." The appellant argued that they should only be liable for service tax from 1-6-2007 onwards, as works contracts became taxable from that date. The Tribunal's finding in the order was that the appellants were liable for service tax from 16-6-2005 under "erection, commissioning and installation services." The appellants contended that their services should fall under works contract on a turnkey basis, making them liable for service tax only from 1-6-2007. The Tribunal, after careful consideration, upheld its decision that the services provided fell under "erection, commissioning and installation service" from 16-6-2005, granting the benefit of a specific notification and allowing input credit. The Tribunal emphasized that reversing this finding would amount to reviewing its own order, suggesting the appellant should pursue normal appeal channels if they disagree. The ROM application was rejected as there was no error apparent on the face of the record, and the findings were based on a thorough examination of the contract.

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