2013 (3) TMI 354

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....es viz. Consulting Engineering, Erection, Commissioning and Installation, Maintenance or Repair service, Site preparations clearance and Construction services. This appeal is against the order-in-original No. 8/2009, dated 29-1-2009 passed by the Joint Commissioner of Central Excise, Service tax Commissionerate, Chennai-35. (hereinafter called the respondent). 2. The brief facts of the case are that during the course of audit by the officer of the Service tax Commissionerate, it was noticed that the appellant were undertaking all the field works of BSNL, Chennai Telephones under contract for the execution of work of trenching and laying of underground telephone cables, cable jointing, pillar constructions, DP fitting and other associated....

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....n cess made as above. (iii) Penalty should not be imposed under Section 76 and 78 of the Finance Act, 1994. After due process of law, the Lower adjudicating authority vide impugned order-in-original, confirmed the demand of service tax proposed in the SCN along with appropriate interest and also levied equal penalty under Section 78 of Finance Act, 1994. 3. It is against this order, the appellant is before this forum on the following grounds : (i) that the activity undertaken by the appellant are in the nature of turn key project, from the stage of design to actual execution. Turnkey projects are recognized as Works contracts under VAT legislation. Service tax on turnkey projects which are in the nature of works contracts was le....

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....he LAA in his detailed order had discussed no where as for what reasons the activities of the appellant cannot be considered as alleged in the SCN i.e. handling charges. (v) that in connection with the invoking the extended period, the first defence of the appellant is that the appellant is a government enterprise and there cannot exist any intention to evade the service tax liability. Also, the intention to evade payment of tax is not mere failure to pay tax, it must be something more i.e. that the appellant must be aware that the tax was leviable and he must deliberately avoid payment of tax. - in support cited various case laws. 4. Personal Hearing was held on 18-7-2011. Shri A.P. Ravi, Advocate, duly authorized by the appellant, a....

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.... letter dated 7-10-2010 that the activity of laying of cables alongside the road would not fall under the purview of service tax. In support of this claim he has quoted C.B.E. & C.'s Circular No. 123/5/2010-TRU, dated 24-5-2010. I find that what the appellant received was service charges for the services such as supervision, management and execution of cable laying and associated works which has been rightly classified by the appellants themselves under 'consulting engineer service' and had paid appropriate service tax. 5.1 It is also seen that the appellants further gets some amounts at certain percentage from BSNL for handling the materials required for execution of the project i.e. for loading the required materials from BSNL's stock ....

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....t and concur with the appellant that as they are rendering services in the category of consulting engineering services, handling and transporting the materials is not at all a part of such consulting engineering services. 5.3 I find that the LAA had held that the appellant is liable to pay service tax under "Erection, Commissioning and Installation service". This observation is totally unsustainable as it is beyond the scope of the SCN as there was no proposal in the SCN agitating the classification of the taxable services rendered. The LAA in his detailed order had not discussed as for what reasons the activities of the appellant cannot be considered as alleged in the SCN i.e. handling charges. Thus I find that the lower adjudicating au....