TaxTMI 
TaxTMI 
2018 (6) TMI 131
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....er Works Contract (Composite scheme for payment of Service Tax) Rules, 2007 w.e.f. 01.06.2007. As per CBEC Circular No.98/1/2008- ST, dated 04.01.2008 which is an amendment to its previous Circular No.97/7/2007-ST, dated 23.08.2007, it has been clarified vide reference Code 097.03/04-1-08 that any provider of service is not entitled to avail the Composition Scheme under Works Contract Rules, 2007 on the projects which are running prior to 01.06.2007. Further, the noticee appeared to have short paid Service Tax on the advances received for providing the taxable services and also appeared to have taken the benefit of Notification No.12/2003 dated 20.06.2003. In order to ascertain whether the noticee were correctly paying the Service Tax under the said taxable category and to further investigate the matter, the file was transferred to Anti-Evasion Branch from Audit Branch. 3. Enquiries were initiated in the Anti-Evasion Branch. The Noticee, vide their letter dated 25.08.2008, clarified that they had fourteen running projects as on 01.06.2007; that they paid Service Tax @ 12% from starting of the projects upto 31st May, 2007 and @ 2% from June, 2007 onwards till February,2008; that ....
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....n 65 (105) (zzd)] commercial or industrial construction service (section 65(105)(zzq) or construction of complex-service [section 65(105)(zzzh), as the case may be, and paid Service Tax accordingly. The contract for the service was a single composite contract. Part of Service Tax liability corresponding to payment received was discharged and the balance amount of Service Tax is required to be paid on or after 1.6.2007 depending upon receipt of payment. Classification of a taxable service is determined based on the nature of service provided whereas liability to pay Service Tax is related to receipt of consideration. Vivisecting a single composite service and classifying the same under two different taxable service depending upon the time of receipt of the consideration is not legally sustainable. In view of the above, a service provider, who paid Service Tax prior to 01.06.2007 for the taxable service, namely, erection, commissioning or installation service, commercial or industrial construction service or construction of complex service, as the case may be, is not entitled to change the classification of the single composite service for the purpose of payment of Service Tax ....
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....concern to any person, in relation to construction service, from so much of the Service Tax leviable thereon under section 66 of the said Act, as is in excess of Service Tax calculated on a value which is equivalent to thirty-three per cent of the gross amount charged from any person by such commercial concern for providing the said taxable service: Provided that this exemption shall not apply in such cases where- (i) The credit of duty paid on inputs or capital goods has been taken under the provisions of the Central Credit Rules, 2004; or (ii) The commercial concern has availed the benefit under the notification of the Government of India, in the Ministry of Finance (Department of Revenue) No.12/2003-Service Tax, dated the 20th June, 2003 [G.S.R. 503(E), dated the 20th June, 2013]" The following explanation was added to the Notification No.15/2004- ST dated 10.09.2004 vide Notification No.4/2005-S.T, dated 1.3.2005. "Explanation: For the purposes of this notification, the „gross amount charged" shall include the value of goods and materials supplied or provided or used by the provider of the construction service for providing such service". 3.7 Whereas, th....
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....espect of „Commercial or Industrial Construction Service‟ and „Construction of Complex Service‟. 3.9 As discussed in para 3.3 and 3.4 above, the noticee did not appear eligible for discharging their Service Tax liability by switching over to the composite scheme as given under Works contracts Services and also did not appear eligible for availing the abatement as given under Notification No.12/2003-ST dated 20.06.2003. They were required to discharge their Service Tax Liability in the manner as prescribed under Notification No.15/2004-ST dated 10.09.2004 applicable to „Commercial or Industrial Construction Services‟ and Notification No.18/2005-ST dated 07.06.2005 in respect of „Construction of Complex Services‟. They were required to add the value of construction material received free of cost from their clients/service receivers into the gross amount charged and then they would have been eligible for abatement of 67% from the gross taxable value. On the basis of the Balance Sheets for the years 2007-08, the notice had received Construction Material on free of cost basis to the tune of Rs. 3,46,06,767/- and Rs. 138,55,57,039/- in t....
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....ng the period April 2000 to March 2010 in terms of Provisions of Section 26 of SEZ Act, 2005 or not. A similar issue was examined by this Tribunal in the case of Tata Consultancy Services Ltd. Wherein this Tribunal observed as under: "5.1 As regards the refund claim of Rs. 6,66,794/- which has been rejected on the ground that the services to which this amount pertains do not have direct nexus with the authorized operations undertaken by the appellant, this stand of the department is totally incorrect. The approval committee which has examined this issue has issued a specific certificate to the appellant indicating the various services received by the appellant and justification for use of such services in relation to authorized operations. The jurisdictional Commissioner of Central Excise is also a member of this approval committee. Once the approval committee has given the nexus and the justification, it was totally unwarranted on the part of the adjudicating authority and the appellate authority to go into this question and come to their own findings in the matter. Therefore, rejection by the lower authorities of the refund claims of the service tax paid on various services on....
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....EZ Act, 2005 and as per Rule 31 of the SEZ Rules, 2006, the appellants are entitled for exemption from payment of service tax on the services which are used or provided to a unit in the SEZ. As per Section 51 of the said SEZ Act, the said provisions prevail over the provisions contained in any other law for the time being in force. It is the avowed policy objective of the Government of India that exports should not bear the burden of taxes. If this policy objective has to be sub-served and the objective realized broader view of the provisions relating to refund has to be taken. Therefore, even if the appellant was not eligible for refund under Notification No.9/2009-ST dated 03/03/2009, the appellants were certainly eligible for refund under Section 11B of the Central Excise Act, 1944". 9. Further, the issue was also examined by this Tribunal in the case of Intaz Pharma Ltd. (supra) wherein this Tribunal further observed as under: 6. We notice that the Special Economic Zones Act, 2005 (Central Act 28 of 2005) was enacted providing for SEZ within the territory of India and for providing interalia immunities/exemptions from taxes/duties/cesses. Section Z of the 2005 Act enjoins....