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Successful Appeal Against Service Tax Demand on Construction of Residential Complex Service The appeal against the Order-in-Original confirming the demand for service tax, interest, and penalty under 'Construction of Residential Complex Service' ...
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Successful Appeal Against Service Tax Demand on Construction of Residential Complex Service
The appeal against the Order-in-Original confirming the demand for service tax, interest, and penalty under 'Construction of Residential Complex Service' was successful. The Tribunal found that the demand was not sustainable as it pertained to an indivisible composite contract with buyers, following a precedent that disallowed such demands post-1.6.2007. The lack of distinguishing arguments or contrary decisions by the Revenue led to the setting aside of the demand and the Order-in-Original, allowing the appeal with any consequential benefits as per law. Judgment was delivered on 24.01.2019.
Issues: Demand for service tax, interest, and penalty under 'Construction of Residential Complex Service' - Appeal against Order-in-Original confirming demand - Applicability of Works Contract Service - Indivisible composite contract with buyers.
Analysis: The judgment pertains to a case where a Show Cause Notice was issued proposing to demand service tax, interest, and penalty for the period April 2007 to January 2010, classifying the activity under 'Construction of Residential Complex Service.' The Order-in-Original dated 26.07.2011 confirmed the demand, which was upheld by the first appellate authority. The appellant filed the present appeal challenging this decision.
During the hearing, both parties presented their arguments, and the Tribunal examined the Show Cause Notice and the Order-in-Original. It was noted that the demand was raised for services related to the 'Construction of Residential Complex' and involved an indivisible composite contract with buyers. The Tribunal referred to a previous case, M/s. Real Value Promoters Pvt. Ltd. & Ors. Vs. Commissioner of G.S.T. & Central Excise, where it was held that demand for service tax on composite works contracts cannot be sustained under 'Commercial or Industrial Construction Service' or 'Construction of Complex Service' post-1.6.2007.
The Tribunal found that the demand in the current case was not sustainable based on the precedent cited and the lack of distinguishing arguments or contrary decisions presented by the Revenue. Consequently, the demand and the Order-in-Original were set aside, and the appeal was allowed with any consequential benefits as per law. The judgment was pronounced in open court on 24.01.2019.
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