TaxTMI 
TaxTMI 
2018 (7) TMI 434
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.... over thereafter. It is also an admitted fact that each of such sale deeds executed did not include the value of the constructed flat. The dispute relates to the period from April, 2006 to March, 2009. 2. The Revenue, through a Show Cause Notice ('(SCN' for short)dated 24.03.2010, on the ground that the activities of the appellant was a taxable service under Section 65 (105)(zzzh) read with Section 65(91a) of the Finance Act, 1994, put the appellant on Notice as to why: " (i) a sum of Rs. 1,18,41,933/- (Rupees One crore eighteen lakhs forty one thousand nine hundred and thirty three only) being the Service tax payable for the period from 01.04.2006 to 31.03.2009 as detailed in Annexure to this notice should not be demanded from them under proviso to Section 73(1) of Finance Act, 1994; (ii) Interest at appropriate rate should not be demanded from them under Section 75 of the Act from the due date of payment till the date of actual payment of the amount demanded above; (iii) Penalty under Section 76, 77 and 78 of the said Act, should not be imposed on them for the contravention of the Act and Rules mentioned above with an intention to evade payment of Service Tax" 3. During t....
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.... the appellant, as a promoter, had entered into agreement with the contractor for the construction of flats, the ownership of which had remained with it and, therefore, this was in the nature of self-service, which is not liable for service tax;and that the learned AA/Commissioner has overlooked both the decisions relied on by the appellant as well as the CBEC instructions/circulars and, therefore, the impugned order is not sustainable. 5. Per contra, the learned Department Representative - DR, Shri K. Veerabhadra Reddy appearing for the Revenue contends that the construction of residential complex service was introduced in the statute with effect from 16.06.2005 and the appellant having commenced its construction activities after that date, was required to get itself registered under the said category and pay service tax as applicable, in time. The learned DR further contends, inter-alia, that the residential complex of the appellant consisted of more than 12 residential units, had a common area with one or more facilities as stated in the definition, within the premises; that the appellant is only trying to take shelter under a clarification which did not cover the appellant's s....
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.... available on record. Section 65(91a) of the Finance Act, 1984, which bears an exclusion, reads as under: " (91a)"residential complex" means any complex comprising of (i) a building or buildings, having more than twelve residential units; (ii) a common area; and (iii) any one or more of facilities or services such as park, lift, parking space, community hall, common water supply or effluent treatment system, located within a premises and the layout of such premises is approved by an authority under any law for the time being in force, but does not include a complex which is constructed by a person directly engaging any other person for designing or planning of the layout, and the construction of such complex is intended for personal use as residence by such person. Explanation. - For the removal of doubts, it is hereby declared that for the purposes of this clause, - (a) "personal use" includes permitting the complex for use as residence by another person on rent or without consideration; (b) "residential unit" means a single house or a single apartment intended for use as a place of residence;" 9. A reading of the above clearly indicates that what is sought to be ....
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.... roof, along with brick-work. The second agreement between the very same parties - for the purpose of carrying on the finishing work like plastering, water supply, sanitary and electric fittings, floorings, etc. The appellant therein had engaged contractors for construction and finishing and only after completion of the construction and finishing, flats were handed over to the customers. As noted by the Principal Bench, the period in dispute was from December, 2005 to October, 2006 and it was the case of the Revenue that the appellant was liable to pay service tax under Section 65 (105) (zzzh) as the service provider on the amount charged by him from the buyers of the flats. Thereafter, on the basis of a subsequent CBEC Circular No. 332/35/06-TRU dated 01.08.2006, the appellant made a request for refund of the service tax paid for the impugned period. 12. After analysing the implication of the above Circular as also various pleadings made by the parties, the Hon'ble Principal Bench inter alia held that there was no dispute that the complex constructed by the appellant in those appeals were covered by the definition of "residential complex" as given in Section 65 (91a); that there ....
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....vice, provided by builders to buyers pursuant to an intended sale of immovable property before, during or after the construction and therefore the provision is expansive of the existing intent and not clarificatory of the same; and is consequently prospective". 9. In view of the above, though in view of the Apex Court judgment in the case of M/s. Larsen & Toubro Limited and Others v. State of Karnataka & Others (supra), the agreements entered into by a builder/promoter/developer with prospective buyers for construction of residential units in a residential complex against payments being made by the prospective buyers in instalments during construction and in terms of which the possession of the residential unit, is to be handed over to the customers on completion of the residential complex and full payment having been made, are to be treated as works contracts, it has to be held that during the period of dispute, there was no intention of the Government to tax the activity in terms of such contracts a builder/developer with prospective customers for construction of residential units in a residential complex. Such works contracts involving transfer of immovable property were broug....