AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2018 (12) TMI 1040
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....on of residential complex in respect of Golden Country Project at Maraimalai Nagar, Kanchipuram District concerning 240 flats in Phase-I. It also appeared that they were engaged in providing site formation and clearance service with respect to their real estate projects at Silver County, Platinum County and other projects. Department took the view that appellants had not paid appropriate service tax; not filed periodical ST-3 returns in respect of the said services provided by them. Hence a show cause notice dt. 29.07.2010 was issued inter alia, demanding service tax liability of Rs. 1,36,61,900/- in respect of construction residential complex service for the period 2006-07 to 2008-09 and Rs. 31,16,246/- in respect of site formation and cle....
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....as much as Section 67 of the Finance Act (hereinafter referred to as the "Act"), dealing with valuation of taxable services, refers to the gross amount charged for service, the service of RCS would cover only pure service activity as any contrary view would imply that the union government can levy service tax on the gross amount, including the value of transfer of property in goods also, which is constitutionally impermissible. The Hon'ble Apex Court also held that it was only with the introduction of Works Contract Service (WCS) as a separate taxable service with effect from 01.06.2007, the statutory mechanism to exclude the value of transfer of property in goods has been prescribed. Therefore, in view of the above, the effect of the afore....
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....,000/- are nothing but income from sale of UDS. (v) The sum of Rs. 2,38,89,740/- (total) received by the Appellant has been spent on the expenses incurred on the land prior to sale. These expenses include expenses such as site filling and other site preparatory expenses. The amount of Rs. 2,90,76,680/- has been spent towards land development expense towards land development prior to the sale of approved plots. (vi) Though an amount of Rs. 2,38,89,740/- has been accounted separately as land development expense, the transaction in substance is a sale and only for accounting purpose it was accounted separately. i.e. part of it as sale of Land and part of it as land development income and this land development income was reported in the profi....
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....sessee to the buyers of flats and consideration towards the said activity has also been collected from the buyers. 4. Heard both sides and have gone through the facts. 6.1 With respect to the demand under construction service, the period involved is 2006-2009. It is not disputed that the appellants entered into an composite works contract involving both provision of service and supply of materials for providing the above service. This being so, the Ld. Advocate is correct in her assertion that as per the law laid down by the Hon'ble Supreme Court in the case of Larsen & Toubro Ltd. (supra) and the decision of this very Bench in the case Real Value Promoters (supra), the said activity will be exigible to service tax only under "Works Contr....
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....land. Ostensibly, such activity would have been done by the appellants to enhance the saleability quotient of the land in question. It clearly appears to reason that a piece of land where site formation and clearing activity has already been carried out, the plotting of the land with various parcels will naturally fetch higher price for the land. This being so, the site formation and clearance activity has obviously been done by the appellant by themselves, for themselves. Further neither the agreement for sale had not seen light of the day, nor were the buyers visible on the horizon, at the time when the site formation etc of the land was carried out by the appellant. 6.3 We therefore have no doubt in our mind that the such activity was a....