Road construction exemption limited to public-use roads; works inside private complexes remained taxable.

Exemption under Notification No. 25/2012-Service Tax for road-related works applies only to roads meant for use by the general public. Roads constructed within residential colonies or commercial complexes with restricted access do not meet that condition, because they serve occupants and visitors rather than the public at large. On the facts recorded, the service tax demand, interest and penalties were sustained, and the extended period was held to be correctly invoked due to non-filing of returns, non-cooperation, and suppression of taxable value. Any amount already deposited during investigation was directed to be appropriated against the confirmed liability.

---

---

Issues: (i) Whether works contract services rendered for construction of roads within residential or commercial complexes qualified for exemption under Sl. No. 13 of Notification No. 25/2012-Service Tax dated 20.06.2012; (ii) whether the confirmation of service tax, interest and penalty, including invocation of the extended period, was sustainable.

Issue (i): Whether works contract services rendered for construction of roads within residential or commercial complexes qualified for exemption under Sl. No. 13 of Notification No. 25/2012-Service Tax dated 20.06.2012.

Analysis: The exemption under Sl. No. 13 of Notification No. 25/2012-Service Tax dated 20.06.2012 is confined to construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation or alteration of roads, bridges, tunnels or terminals for road transportation for use by general public. The expression "general public" was held to mean roads open to the public at large, and not roads having restricted access within a residential complex or commercial premises developed by a builder. The activity in question was carried out within private colonies and complexes, and therefore the roads were for private use by occupants and visitors, not for use by general public. Exemption notifications were required to be construed strictly, and the interpretation advanced by the appellant was rejected.

Conclusion: The appellant was not entitled to exemption under Sl. No. 13 of Notification No. 25/2012-Service Tax dated 20.06.2012.

Issue (ii): Whether the confirmation of service tax, interest and penalty, including invocation of the extended period, was sustainable.

Analysis: The appellant was registered under service tax but had not filed returns and had not discharged the tax collected from clients. The record disclosed non-cooperation during investigation, failure to produce supporting records, and suppression of taxable value and liability. On these facts, the findings on tax demand were upheld, along with interest and penalties under the relevant provisions. The extended period was also held to have been rightly invoked. Any amount already deposited during investigation was to be appropriated towards the confirmed liability.

Conclusion: The confirmation of service tax, interest and penalty, including invocation of the extended period, was sustained.

Final Conclusion: Both appeals failed, and the impugned orders were affirmed because the disputed road-construction activity inside residential or commercial complexes did not fall within the exemption meant for roads used by the general public.

Ratio Decidendi: Exemption for construction of roads is available only when the roads are meant for use by the general public, and roads built within residential or commercial complexes with restricted access do not satisfy that requirement.

---