Appeal Allowed: Tribunal Finds No Service Tax Due for Works Contract Service; Dismisses Allegations and Limitations.

The Tribunal set aside the impugned order, allowing the appeal with consequential relief. It determined that the appellant provided 'Works Contract Service' during the relevant period, which was not liable for service tax based on a Supreme Court judgment. The Tribunal found no merit in the allegations of non-payment of service tax on advances and materials supplied, acknowledging the appellant's compliance and payment on advances received. The invocation of the extended period of limitation was also dismissed, recognizing the appellant's filing of periodical ST-3 returns. The Tribunal's decision aligned with its previous ruling in the appellant's subsequent case.

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Issues:
1. Allegation of non-payment of service tax on advances received.
2. Allegation of non-payment of service tax on cost of materials supplied by customers.
3. Invocation of extended period of limitation for recovery of service tax.
4. Applicability of service tax on 'works contract' services.
5. Justification for interest and penalty imposition.

Analysis:

The appeal was filed against an Order-in-Original passed by the Commissioner of Central Excise-II, Bangalore, alleging non-payment of service tax on advances received and cost of materials supplied by customers during the period June 2005 to March 2006. The appellant contended that the services provided were in the nature of 'works contract' and not liable to service tax. The appellant also argued that the issue of including the value of materials in the cost of taxable value was covered by a Supreme Court judgment. The appellant claimed that the entire service tax amount related to advances had been paid while settling the final bill. Additionally, the appellant challenged the invocation of the extended period of limitation, citing the filing of periodical ST-3 returns and the non-leviability of service tax on 'works contract' services before 01.06.2007 based on a Supreme Court judgment.

The Tribunal considered whether the appellant was required to pay service tax for providing 'commercial or industrial construction' and 'construction of complex services' during the period in question. The Tribunal noted that the appellant had paid service tax on advances received during the relevant period and that the issue of non-payment of service tax on the cost of materials supplied was covered by a Supreme Court judgment. It was established that the appellant had rendered 'Works Contract Service' during the period in question, as acknowledged in the show-cause notice and the impugned order. The Tribunal referred to its own decision in the appellant's subsequent case, where it was concluded that the appellant had provided Works Contract service. Consequently, the Tribunal found no merit in the impugned order, setting it aside and allowing the appeal with any consequential relief as per law.

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