Service tax exemption for public road works and railway siding services upheld; extended limitation rejected for lack of suppression.

Construction of a road certified for use by the general public fell within the service tax exemption for road construction under Notification No. 25/2012-S.T., so the demand on that work was not sustainable. Services rendered in connection with construction of railway sidings and allied railway-related work were treated as not liable to service tax, following settled precedent, so that demand was also set aside. The Tribunal further found no established suppression of facts with intent to evade tax, so the extended period of limitation could not be invoked and the remaining demands were barred by limitation. The entire disputed tax demand was therefore removed.

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Issues: (i) Whether construction of a road meant for use by the general public was exempt from service tax under Notification No. 25/2012-S.T. dated 20.06.2012; (ii) whether services rendered in connection with construction of railway sidings and allied railway-related work were liable to service tax; (iii) whether the demands of Rs.7,68,021/- and Rs.2,34,560/- could be sustained by invoking the extended period of limitation.

Issue (i): Whether construction of a road meant for use by the general public was exempt from service tax under Notification No. 25/2012-S.T. dated 20.06.2012.

Analysis: The exemption entry covers services by way of construction of a road for use by the general public. The road in question was certified by the local authority as meant for public use, bringing it within the scope of the exemption.

Conclusion: The demand on this count was not sustainable and was set aside.

Issue (ii): Whether services rendered in connection with construction of railway sidings and allied railway-related work were liable to service tax.

Analysis: The Tribunal relied on the settled position that services in relation to railway sidings are not liable to service tax, following the Supreme Court's affirmation of that view. The services rendered to the railway-related project and to the connected contractor were treated as covered by that principle.

Conclusion: The demand on this count was not sustainable and was set aside.

Issue (iii): Whether the demands of Rs.7,68,021/- and Rs.2,34,560/- could be sustained by invoking the extended period of limitation.

Analysis: The Tribunal found no established suppression of facts with intent to evade tax. In the absence of such foundational facts, the extended period could not be invoked against the appellant.

Conclusion: Both demands were held to be barred by limitation and were set aside.

Final Conclusion: The entire disputed tax demand was removed, leaving no surviving liability in the appeal.

Ratio Decidendi: Where a service squarely falls within a specific exemption for public-road construction or is rendered in relation to railway sidings covered by settled precedent, and where suppression of facts with intent to evade tax is not established, the corresponding demand cannot be sustained, nor can the extended period of limitation be invoked.

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