2005 (10) TMI 1

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....iming exemption in respect of erection and commissioning service. This category of service is brought under service tax w.e.f., 1-7-2003. It was submitted by the appellants that the goods are cleared on payment of central excise duty on the whole value of contract. The original authority held that the appellants are liable to pay 33% of the gross value of the contract as per notification No. 19/2003-S.T. dated 21-8-2003 or pay the applicable service tax after availing the benefit of notification No. 12/2003-S.T. dated 20-6-2003 on the commissioning and installation charges collected by them. He imposed a penalty of Rs. 100/- per day under Section 76 of the Finance Act, 1994, after confirming the demand to the extent of commissioning and ins....

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....e capacity as a manufacturer and not as a service provider. The activity of installation and commissioning carried out at the project site by the appellant is not a service activity but a manufacturing activity. CESTAT, Chennai in the case of CCE, Chennai v. Binny Ltd., reported in 2003 (151) E.L.T. 106 (Tri.-Chennai) has held that when duty paid goods are assembled at site, the goods would continue to be excisable goods and liable for excise duty. Further the Ministry has given in their 37B order No. 58/1/2002-Cx., dated 15-1-2002 that the erection, installation charges should be included in the assessable value, if the resultant goods are movable. 4.The learned departmental representative submitted that as stated by the original author....