TaxTMI 
TaxTMI 
2016 (3) TMI 832
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....appointed as contractor for construction of academic complex of Indian Institute of Technology, Bihta, by NBCC vide letter of award, dated 20th December, 2012. The relevant extract for the purpose of this writ petition, from the letter of award reads as under:- "4.2. SALES TAX ON WORKS CONTRACT AND TURNOVER TAX The award of work under this contract is on "Works Contract Basis". You shall be responsible for payment of any tax levied on the transfer of property in goods involved in the "works Contract" under Bihar State Government Sales Tax Act and the rules made thereunder including amendments, if any. This liability shall be to your account and it shall not be reimbursed by NBCC. xxx xxxx xxxxxxxxxxx xxxxxxxxxx 4.2.4 The contractor shall be required to have a valid Service Tax registration under "Work Contract Service" for executing this work. The rates quoted by the contractor are exclusive of Service Tax. The Contractor will be required to submit service tax paid challans to NBCC and the same will be reimbursed to the contractor on receipt from IIT Patna." 2. In terms of the letter of award, the petitioner registered itself with respondent No. 1 and ....
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....nal institutions. It is clarified that the service provided to Institute is related to construction work but is not exempt from payment of service tax. Annexure - A appended to the reply dated 06.10.2015, addressed to respondent No.3, makes a mention of the Notification dated 30th January, 2014, to assert that service tax is payable by the Petitioner for the relevant period. 6. At this stage, certain statutory provisions relating to imposition of service tax under the Finance Act, 1994 and the Notifications issued from time to time need to be extracted - "65B. Interpretations.- In this Chapter, unless the context otherwise requires,- ................ (31) "local authority" means - (a) a Panchayat as referred to in clause (d) of article 243 of the Constitution; (b) a Municipality as referred to in clause (e) of article 243P of the Constitution; (c) a Municipal Committee and a District Board, legally entitled to, or entrusted by the Government with, the control or management of a municipal or local fund; (d) a Cantonment Board as defined in section 3 of the Cantonments Act, 2006 (41 of 2006); (e) ........" xxxxxx xx....
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....antly meant for self-use or the use of their employees or other persons specified in the Explanation 1 to clause 44 of section 65B of the said Act." Notification No. 2/2014 ST dated 30th January, 2014, partially amending the notification dated 20th June, 2012 reads as under:- "In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994), the Central Government being satisfied that it is necessary in the public interest so to do, hereby makes the following further amendments in the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 25/2012-Service Tax, dated the 20th June, 2012, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide GSR 467(E), dated the 20th June,2012, namely:- In the said notification, in the paragraph 2, for clause(s), the following shall be substituted, namely:- (s) "governmental authority" means an authority or a board or any other body; (i) set up by an Act of Parliament or a State Legislature; or (ii) established by Government, With 90% or more participation by way of equity or control,....
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....ita Nirvikar are not sustainable in law. The Governmental Authority as defined in the Notification dated 30th January, 2014, means an authority or a board or any other body set up by an Act of Parliament or State Legislature. The provisions contained in sub-clause (i) and sub-clause (ii) of Clause 2(s) are independent dis-conjunctive provisions and the expression "90% or more participation by way of equity or control to carry out any function entrusted to a municipality under Article 243W of the Constitution" is related to sub-clause (ii) of Clause 2(s) alone. The clause (i) is followed by ";" and the word "or". Therefore, each of the sub-clauses is independent provision. The condition of 90% or more participation by way of equity or control to carry out any function entrusted to a municipality under Article 243W of the Constitution is relatable to only sub-clause (ii) of Clause 2(s). It means that an authority established by Government should have 90% or more participation by way of equity or control to carry out any function entrusted to a municipality under Article 243W of the Constitution to be eligible for exemption. The Authority set up by an Act of Parliament or State Legisl....