Court quashes Assessment order on works contract & service tax calculation, upholds petitioner's contentions. Respond within two weeks.

The Court quashed the Assessment order challenged by the petitioner regarding works contract and service tax calculation. The petitioner's contentions on the failure to grant abatement and incorrect imposition of tax were upheld. The Court directed the petitioner to respond within two weeks, with the respondents instructed to conduct assessment proceedings promptly and without adjournments, to be completed within eight weeks. The Writ Petition was allowed without costs, and the connected miscellaneous petition was closed.

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Issues involved: Challenge to Assessment order based on works contract and service tax calculation.

Summary:

Issue 1: Failure to respond to notices and Assessment order based on works contract
The petitioner challenged the Assessment order dated 22.03.2023, citing that despite being engaged in works contract, the respondent did not grant the abatement of 60% as provided under Rule 2(ii)(A) of Service Tax (Determination of Value) Rules, 2006. The respondent imposed 100% tax without considering the relevant provisions for works contract execution.

Issue 2: Applicability of service tax based on status under Company's Act
The petitioner contended that if considered as registered under the Company's Act, only 50% tax should be imposed as per S.No.9 of Notification No. 30/2012-ST dated 20.06.2012. The respondent's imposition of 100% tax without invoking the relevant Rule and Notification warranted interference by the Court.

Judgment:
The Court, after considering the arguments, quashed the Assessment order and directed the petitioner to submit a reply within two weeks. The respondents were instructed to conduct a personal hearing without adjournments, completing the assessment proceedings within eight weeks. The Writ Petition was allowed with no costs, and the connected miscellaneous petition was closed.

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