2014 (10) TMI 132

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....59,101/- for having provided works contract services during 1-6-2007 to 31-3-2011 for different departments of several State Governments including the Irrigation & C.A.D. Department of Andhra Pradesh; Public Health Engineering Department of Madhya Pradesh; the Andhra Pradesh State Irrigation Development Corporation Ltd.; and the Tamil Nadu Water Supply and Drainage Board, by way of supply and construction of pipelines, for supply of drinking water, evacuation of drainage and irrigation. Service Tax liability of Rs. 2,53,22,819/- is also confirmed for having provided works contract service during the same period in favour of M/s. NTPC-SAIL Power Company (Pvt.) Ltd. (NTPC for short) by way of commercial or industrial construction. The order a....

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....tracts are however and in terms of the contracts thereunder, mutually dependant and connected. The adjudicating authority, on the basis of the Explanation to Rule 3(1) of the Works Contract (Composition Scheme for payment of Service Tax) Rules, 2007, computed the value of the transaction covering the two contracts (viz. the supply portion and the goods & services portion) for assessment of Service Tax, after granting the benefit of the composition scheme. 4. It however requires to be noticed that the Explanation to Rule 3(1) of the 2007 Rules was introduced vide Notification No. 23/2009-S.T., dated 7-7-2009 whereby the benefit of the composition scheme entitling remittance of a specific percentage of Service Tax on the gross amount ....

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....itted Rs. 6,01,093/- and interest of Rs. 2,07,570/- on an assumption that it had provided Business Auxiliary Service (BAS) to NTPC, on the component of the 5% commission received from NTPC. Prima facie, the classification of the service as works contract service and as concluded by the adjudicating authority and not BAS as the petitioner assumed, appears to be unassailable. The petitioner is however entitled to take credit of the amount of Rs. 6,01,093/- already remitted, but for BAS. On this analysis, the balance Service Tax liability of the petitioner in respect of the transaction value of works contract provided to NTPC is Rs. 30.65 lakhs (approximately). 7. Petitioner urges that invocation of the extended period is unsustainable....