TaxTMI 
TaxTMI 
2013 (7) TMI 396
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....India, Municipal Corporation of Nagpur, CPWD etc. Such services included repairs and strengthening of roads, improvement and resurfacing of runways, construction of toll plazas and the appellant was not discharging service tax. The records of the appellant were called for, for the period 2005-06 to 2009-10 by letter dated 09/07/2010 which was submitted by the appellant in August and September, 2010. On scrutiny of the documents it was observed that the appellant had undertaken repair activities of roads for various government agencies, improvement and resurfacing of runways for the Airport Authority of India and certain military airbases, construction of toll plazas etc., apart from undertaking site formation and clearance, excavation and earth moving, and demolition services. Accordingly, a show cause notice dated 13/10/2010 was issued to the appellant demanding service tax of Rs.10,25,72,125/- for the period 2005-06 to 2009-10 by proposing to classify the activities undertaken under the aforesaid services. The said notice was contested. However, vide the impugned order service tax demands were confirmed along with interest thereon and penalties were imposed on the appellant under....
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.... the road and bridge works by the Ministry of Road Transport and Highways, Government of India, the said standards cover specification for runways also and, therefore, runway is nothing but a road or a species of road. He also relies on the decision of this Tribunal in the case of Shilpa Constructions Pvt. Ltd. 2010(19)STR 830 wherein it was held that a driveway to a petrol pump also amounts to construction of road as a driveway facilitates those people to come to a petrol pump for filling fuel. Alternatively, he submits that as per section 65(25b) of the Finance Act, 1994, 'Commercial or Industrial Construction Service' means: (d) repair, alteration, renovation or restoration of, or similar services in relation to building or civil structure, pipeline or conduit" ...but does not include such services provided in respect of roads, airports, railways, transport terminals, bridges, tunnels and dams." Since the repair services of roads are specifically excluded under 'Commercial or Industrial Construction Service', the said activity cannot be brought under 'Management, Maintenance or Repair Service' under section 65(24). He relies on the clarification issued by the Ministry i....
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....ould not have considered the exemption available to such activities and hence the matter needs to be remanded to the adjudicating authority to re-compute the service tax demand taking into account the exemption available. However, he strongly refutes the argument of the appellant that runway is a species of road. According to International Civil Aviation Organization (ICAO) 'runway' is defined as "a rectangular area on a land aerodrome prepared for the taking off of aircraft". Since India is a member of ICAO and all the airports have to be constructed and regulated in terms of the ICAO guidelines, the definition of 'runway' by ICAO would be relevant and as per this definition 'runway' is only a rectangular strip of land for landing or taking off of aircrafts . By no stretch of imagination, the runway can be constructed as a road or as a species of a road. The learned AR also contends that road is a means of travel by passengers or for carriage of goods from one place to another and it has to have access by the public. However, in the case of runways public access is prohibited and it is only meant for landing or taking off of the aircrafts. Therefore, runway cannot be considered as....
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....erms of the dictionary meaning of the road and the common understanding of the subject. According to shorter Oxford English Dictionary, 5 th edition, 'road' means: "a path or way between different places, usually, one wide enough for vehicles as well as pedestrians and with a specially prepared surface. Also the part of such a way intended for vehicles, the roadway, an underground passage or gallery in a mine, a railway." The said dictionary gives the meaning of 'runway' as follows: "A specially prepared surface on an airfield along which aircrafts take off and land." From the above definitions while a road is a path or way between two different places, a runway is a specially prepared surface on an airfield. The purpose for which a road is put to use and a runway is put to use are substantially different. While a road is a means of travel from one place to another for the purpose of transportation of passengers or goods or animals, the runway is not a means of travel at all. Public access is prohibited and it is only a piece of land where the aircrafts can land or take off. It is also not necessary that runways has to be built on land. In the case of aircr....
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....ot liable to service tax because of its specific inclusion under section 65(25b) under 'Commercial or Industrial Construction Service', there was no need for the legislature to exempt the said activity vide notification no. 24/2009-ST dated 27/07/2009 and give retrospective effect to the said exemption vide section 97 of the Finance Act, 2012. The specific exemption for maintenance or repair of roads by the legislature retrospectively clearly shows that the said activity is a taxable activity and, therefore, in public interest the same has been given exemption. If the activity was not taxable ab initio, there was no need for the legislature to pass a specific legislation for this purpose. This also shows that the reliance placed by the appellant on the various case laws in this regard does not support the contentions raised by the appellant. 5.4 As regards the claim of the appellant that in respect of runways constructed in defence airports, the benefit of retrospective exemption under section 98 of the Finance Act, 2012 would be available, this aspect needs consideration by the adjudicating authority as this issue had not been raised or considered by the said authority. 6. I....