Appeal granted on service tax for residential complexes pre-2007. Construction for personal use exempt.

The Tribunal allowed the appeal, setting aside the demand for service tax on construction of residential complexes. It ruled that the demand prior to 01.06.2007 was not sustainable based on a Supreme Court decision. Additionally, it held that construction intended for personal use, including residence by another person, is excluded from service tax liability. The judgment provided clarity on the distinction between periods before and after 01.06.2007 and emphasized the exemption for construction meant for personal use.

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Issues:
1. Demand of service tax on construction of residential complexes.
2. Applicability of service tax prior to 01.06.2007.
3. Exclusion of liability for service tax on complexes intended for personal use.

Analysis:
1. The appellant was engaged by the Tamilnadu Police Housing Corporation Ltd. for constructing residential complexes. A show cause notice was issued proposing service tax on these activities. After due process, the demand was confirmed by the authorities, leading to an appeal before the Tribunal. The matter was remanded for reconsideration, resulting in an order confirming the demand, interest, and penalties. The appellant appealed again, arguing against the demand.

2. The period involved in the case was from 16.06.2005 to 31.08.2007. The appellant contended that demand prior to 01.06.2007 could not be sustained based on a Supreme Court decision. The Tribunal agreed and set aside the demand for the period before 11.06.2007.

3. Regarding the demand after 01.06.2007, the appellant argued that the complexes constructed were intended for personal use, which falls outside the definition of construction of residential complex liable for service tax. Citing a previous Tribunal order, the appellant sought to set aside the demand. The Tribunal examined the definition of residential complex and concluded that construction for personal use, including permitting residence by another person, is excluded from service tax liability. Relying on this interpretation, the Tribunal set aside the demand after 01.06.2007 as well.

In conclusion, the Tribunal set aside the impugned order, allowing the appeal with any consequential reliefs. The judgment clarified the applicability of service tax, distinguishing between periods before and after 01.06.2007 and highlighting the exclusion of liability for construction intended for personal use.

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