2019 (2) TMI 314 - AT - Service Tax

Tribunal rules plumbing services essential for construction; appellant eligible for tax benefit

The Tribunal ruled in favor of the appellant, holding that the plumbing services provided were essential for building construction and not merely ... Classification of service - plumbing services to various builders - period from 2006-07 to 2012-13 - Benefit of abatement - N/N. 01/2006-ST dt. 1.3.2006 - whether the piping system installed in the constructed building by the appellant would be treated as completion and finishing work? - Held that:- Completion of the piping network is mandatory to obtain occupancy certificate of the building. Hence, it cannot be considered as finishing and completion work, in the sense used in the notification number 01/2006 ST dt. 01.3.2006 - Besides, it is also clear when one reads the meaning and scope of ‘completion and finishing service’ mentioning the activities which are to be considered as completion and finishing work under the scope of ‘commercial or Industrial construction’ and ‘construction of complex service’ as defined under Sec.65(25b) and (30a) of the Finance Act,1994, respectively. The Appellant are eligible to the benefit of the N/N. 01/2006 ST Dt.01.3.2006 - appeal allowed - decided in favor of appellant. Issues Involved:Determining eligibility for the benefit of Notification No. 01/2006-ST dt. 1.3.2006 regarding plumbing services provided by the appellant.Analysis:1. Facts of the Case: The appellant provided plumbing services to builders from 2006-07 to 2012-13. Show cause notices were issued alleging short payment of service tax, leading to the demand being confirmed with interest and penalty.2. Appellant's Argument: The appellant claimed the benefit of exemption under Notification No. 01/2006-ST dt. 1.3.2006, stating that the plumbing services provided were essential for building construction and not completion or finishing services. The appellant argued that the services were necessary for occupancy of the building.3. Revenue's Position: The Revenue supported the Commissioner's classification of the plumbing services under taxable categories of 'commercial or industrial construction service' and 'construction of complex service,' denying the benefit of the notification based on the services being considered completion and finishing work.4. Legal Interpretation: The central issue was whether the piping system installed by the appellant constituted completion and finishing work as per the notification. The Tribunal analyzed the definition of completion and finishing services under the Finance Act, 1994, and concluded that the plumbing services provided were integral to building construction and not merely finishing work.5. Exemption Criteria: The Tribunal highlighted that the exemption under Notification No. 01/2006-ST applied to both 'Commercial or Industrial Construction Service' and 'Construction of Complex Service' unless the services pertained to completion and finishing work, which was not the case with the plumbing services in question.6. Decision: The Tribunal ruled in favor of the appellant, stating they were eligible for the benefit of Notification No. 01/2006-ST dt. 1.3.2006. The impugned order was modified accordingly, and the appeal was allowed to that extent.This detailed analysis of the legal judgment showcases the arguments presented by both parties, the legal interpretation of relevant provisions, and the final decision rendered by the Tribunal regarding the eligibility of the appellant for the exemption under the specified notification.