Operative appellate order principle bars reassessment; subcontractor services exempt under Notification No.25/2012 ST, assessment quashed.

Assistant Commissioner could not reopen or reassess issues already decided by an operative appellate order because subordinate assessing officers must give effect to higher appellate decisions; consequence: reassessment on that ground was barred in favour of the assessee. The subcontractor's turnover for 2015-16 and 2016-17 was held to fall within the exemption applicable to the principal contractor's works, applying the rule that subcontractor services are exempt when the principal works qualify for the exemption; consequence: the assessments were quashed and the turnovers exempt in favour of the assessee.

---

---

Issues: (i) Whether the Assistant Commissioner was entitled to reopen and assess the petitioner for later assessment years notwithstanding the earlier finding and appellate order holding that the petitioner's sub-contractor services were exempt under Notification No. 25/2012 ST; (ii) Whether the petitioner's turnover for the assessment period 2015 16 and 2016 17 was liable to service tax or exempt by virtue of Entry No. 12 read with Entry No. 29(h) of Notification No. 25/2012 ST.

Issue (i): Whether the Assistant Commissioner could reopen and reassess issues already decided by the Assistant Commissioner and upheld by the Commissioner (Appeals).

Analysis: The Court examined the binding effect of earlier appellate orders and the principle that subordinate revenue officers must give effect to orders of higher appellate authorities unless stayed or set aside. The Court relied on established principles restricting re-litigation by subordinate assessing officers where appellate orders on the same issue have been rendered and remained operative, and noted available departmental remedies for disagreement with appellate orders.

Conclusion: The Assistant Commissioner was not entitled to proceed to reassess the same issues after an operative appellate order; this conclusion is in favour of the assessee.

Issue (ii): Whether the petitioner's turnover for the periods 2015 16 and 2016 17 is exempt under Entry No. 12 read with Entry No. 29(h) of Notification No. 25/2012 ST.

Analysis: The Court evaluated the nature of the works executed by the main contractor (CPWD) and the petitioner's role as sub contractor, observing that the works related to educational and governmental structures that fall within Entry No. 12. The Court noted that Entry No. 29(h) exempts services by a sub contractor where the principal contractor's works are exempt under the notification, and found that the Assistant Commissioner's conclusion to tax the petitioner was reached despite earlier findings that the petitioner's works were sub contracted to CPWD and fell within the exemption.

Conclusion: The turnovers for the specified periods are exempt under Entry No. 12 read with Entry No. 29(h) of Notification No. 25/2012 ST; this conclusion is in favour of the assessee.

Final Conclusion: The impugned assessment order is set aside and the petitioner's challenge succeeds, resulting in the quashing of the assessment for the periods in question and confirmation that the exemption under Notification No. 25/2012 ST applies to the petitioner as a sub contractor.

Ratio Decidendi: Where an appellate authority has rendered an operative decision on the substantive taxability of transactions, subordinate assessing officers must follow that decision and cannot reopen and reassess the identical issue in subsequent proceedings; additionally, a sub contractor's works are exempt under Entry No. 29(h) of Notification No. 25/2012 ST when the principal contractor's works qualify for exemption under Entry No. 12 of the same notification.

---