Leviability of service tax on construction of canals by Government agencies - reg.

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....canals by Government agencies - reg. On a reference being received by the Board, two following issues were examined for a clear understanding of facts. The first is regarding leviability of service tax on construction of canals for Government projects. 1. As per section 65 (25b) of the Finance Act, 1994 "commercial or industrial construction service" means - (a) construction of a new building o....

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....clude such services provided in respect of roads, airports, railways, transport terminals, bridges, tunnels and dams. 2. Thus the essence of the definition is that the "commercial or industrial construction service" is chargeable to service tax if it is used, occupied or engaged either wholly or primarily for the furtherance of commerce or industry. As the canal system built by the Government or ....