2016 (3) TMI 899

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....and commissioning service", "business auxiliary service", "consulting engineering service" and for discharge of liability as recipient of "goods transport agency service". The appellant undertook construction of power transmission lines from Nagothane to Wadkahal sub-station for the Maharashtra State electricity Transmission Company Ltd. (MSETCL) at an estimated cost of Rs. 554 crores to be completed within fifteen months from the date of contract i.e. 8 th May 2006. The turnkey project was to be executed in accordance with the composite contract comprising supply of components as well as labour. Though appellant discharged service tax liability of Rs. 22,50,683/- on 5 th July 2007, M/s MSETCL refused to reimburse that tax on the ground tha....

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....t the appellant contracted with M/s MSETCL after following due process of tendering which, admittedly, is work to be executed on turnkey basis. Accordingly, while it may comprise performance of a number of services the actual composition of the service is no means susceptible to segregation. Admittedly, turnkey contracts also include supply of goods necessary for execution of the projects. It is a normal practice in such a contract to provide a detailed breakup, with invoices raised to mirror the contents of the payments in the contract, for regular payments to be made to the contractor. Such a break up is a necessary input for management of the finance related to the work itself, especially when a work is executed over a longer period of t....

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.... also cited besides Notification 45/2010-ST dated 20 th July 2010, which states: "Electricity - Exemption to all taxable services relating to transmission of electricity till 26-2-2010 and distribution of electricity till 21-6-2010 Whereas, the Central Government is satisfied that a practice was generally prevalent regarding levy of service tax (including non-levy thereof), under section 66 of the Finance Act, 1994 (32 of 1994) (hereinafter referred to as 'the Finance Act'), on all taxable services relating to transmission and distribution of electricity provided by a person (hereinafter called 'the service provider') to any other person (hereinafter called 'the service receiver'), and that all such services were ....

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....n the case of M/s L&T Ltd . Its ratio has also been referred to by the Gujarat High Court in the case of Elecon Engineering Co . Ltd . v. Union of India - 2005 (182) E.L.T. 148 (Gujarat H.C.). Further in Ircon International Ltd . v. CCE , Mumbai - 2002 (2) STT 264, Tribunal has held th at construction contract could not be subjected to service tax as consulting engineering service, either as a whole or in part and further observed that position remains covered by the decision in the case of Daelim Industrial Co . cited supra. Revenue has not been able to distinguish the present contract from that involved in Daelim case because the contract in the present cases are essentially for construction and not for the services and the services refer....