TaxTMI 
TaxTMI 
TaxTMI 
2018 (4) TMI 844
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....ow cause notice dated 12/10/2015 the impugned order was passed in which demand for Service Tax was upheld on various grounds. The issues involved in the present case along with the amounts of Service Tax demanded are summarized below for ready reference: - S. No. Issue Period Service Tax/Credit (Rs.) 1. Non-payment of Service Tax on construction of individual villas in two projects, namely "Manglam Aangan Villas" and "Manglam Arpan Villas" April, 2011 to March, 2015 3,03,81,327/- 2. Non-payment of Service Tax on services redered before July, 2010, but payments received thereafter July, 2010 to July, 2011 1,79,93,931/- 3. Short-payment of Service Tax on electricity and transformer charges received from customers under the category of PLC services. July, 2010 to March, 2015 7,73,696/- 4. Short-payment of Service Tax on club charges received from customers under the category of club services April, 2011 to March, 2015 19,61,932/- 5. Service Tax liability under works contract services under reverse charge mechanism on service received for construction of road in projects. July, 2012 to March, 2015 1,50,96,336/- 6. Service Tax liabili....
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....case of L & T 2015 (39) STR 913 (SC) has held that in the case of composite contracts no Service tax can be charged prior to introduction of WCS W.E.F. 01.07/2012. Hence no Service tax demand can be confirmed up to 30/06/2012. iv. The demand cannot be confirmed even for the period from 01/07/2012 in terms of Section 66 E (b) since the show cause notice has raised the demand under CCS and the service is not classifiable therein, as per the ratio of the decision of Hon'ble Tribunal in the case of URC Construction Pvt. Ltd. V/s Commissioner, 2017 - TIOL - 1214 CESTAT. MAD. v. The activities undertaken by the appellant for the two villa s projects are not classifiable under the category of CCS, since the projects involved construction of individual villa s which can be categorized under "Residential Complex" Residential Complex as defined in Section 65 (91a). This definition is reproduced below: - "Residential complex" is defined in Section 65(91a) to, inter - alia, mean a complex comprising of (a) a building or buildings, having more than twelve residential units, (b) a common area, and (c) any one or more of facilities or services such as park, lift etc. He argued that to co....
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....x is liable. 4. The Ld. DR justified the impugned order. His submission sare summarized below: - i. The ratio laid down by the Hon'ble High Court of Delhi in the case of Suresh Kumar Bansal (supra) is not applicable to the present case. He submitted that retrospective amendment has been carried out in Rule 2A of Service Tax (determination of Value Rules, 2006) vide Section 129 of the Finance Act, 2017. This amendment has provided for machinery provision to arrive at the value of service in composite contract s. ii. He argued that the Hon'ble High Court has referred to decision of the Apex Court in the case of L & T in respect of WCS. Contracts execute d by the appellant are in the nature of CCS which is a different category. If all composite contracts are to be classified under WCS, then the definition of CCS will become otiose. The township developed by the appellant consists of a large number of villa s which were enclosed by a boundary wall. The complex also had common facilities such as internal roads, parks, street lights, sewage line etc. In view of these, it forms Residential Complex and the activity will fall under CCS and the Service Tax is liable to be paid thereon. ....
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....ct could be charged in respect of composite contracts such as the ones entered into by the petitioners with the builder. The impugned explanation to the extent that it seeks to include composite contracts for purchase of units in a complex within the scope of taxable service is set aside." 7. The appellant has submitted that in view of the decision of the Hon'ble Delhi High Court (Supra) , no Service Tax can be charged under CCS for the period up to 30/06/2012. Further it has been argued that even W.E.F. 01/07/2012 (when levy of Service Tax was extended to all services other than those specified in the negative list in Section 66D), the same position will hold good. The Construction of Complex Service is specified in Section 66E (b) as a declared service. No machinery provision has been inserted in either Act or Rules for excluding component s other than Service Components. 8. On perusal of the impugned order, we notice that the decision of the Hon'ble High Court was not cited before the lower Adjudicating Authority. Hence, he had no occasion to examine the issue with reference to this important judgment of the Hon'ble Delhi High Court. 9. The appellant has also raised alternat....