TaxTMI 
TaxTMI 
2018 (12) TMI 1188
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....td (APSHCL) (Rajiv Gruh Kalpa) and for providing services of construction to M/s Aparna Infra Housing Pvt Ltd, M/s Software Engineers Employees Housing & Welfare Association and to Kothagudem Thermal Power Station (KTPS). All these projects were taken up by them during the period 2006-07 to 2010-11 and they discharged VAT accordingly under works contract. 3. A show-cause notice dated 09.04.2012 was issued to appellant alleging suppression of facts and demanding service tax liabilities under the category of "commercial or industrial construction services", "construction of complex services", "works contract services" and "transportation of goods by road services". Appellant contested the show-cause notice on merits and also on limitation, interalia raising various points. The adjudicating authority after considering the submissions made by the appellant and after following due process of law held that the demands raised are correct and accordingly confirmed the demands raised along with interest and imposed penalties. The appellant is before the Tribunal against the said order. 4. Learned counsel appearing on behalf of the appellant after taking us through the entire case reco....
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....ommercial or industrial nature. He would draw our attention to the definition of works contract services under Section 65(105)(zzzza) of the Finance Act 1994 and submit that clause-B of sub-clause (ii) of works contract indicate that if there is construction of a new building or a part thereof, it becomes taxable if the same is primarily for the purposes of commerce or industry. He would submit that the housing projects which were undertaken by them were not for commerce or industry, and takes us through various hand-outs in respect of share holding patterns of APIICL and APSHCL to submit that these corporations are State Govt Corporations and are not for private companies. As regards the services rendered to KTPS, it is the submission that these services are rendered to a thermal power station which generates electricity and the services rendered during the year 2007-08 and 2008-09 are exempted by 11C Notification No. 45/2010 dated 20th July 2010. He submits that this Notification is for transmissions and distribution of electricity, but transmission and distribution of electricity cannot be effected without generation and distribution of electricity, and hence the Notification wh....
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....2014(33)STR 383 (Tri-Del)] in respect of tax liability on the KTPS and in the case of Kedar Constructions Vs CCE Kolhapur [2015(37) STR 631 (Tri-Mum)] as also following case laws. 1. CCE Vs. Kerala State Electricity Board - (2006) 5 STT 73 (Ker. HC. DB.) 2. Jindal Steel VS. CCE - (2006) 4 STT 257 (CESTAT). 3. Vikram Cement Vs. CCE - (2007) 11 STT 97 (CESTAT). 4. Indian Petrochemicals Corporation Vs. CCE - (2007) 9 STT 242 (CESTAT Ahd. Bench). 5. DNS Contractor Vs. CCE, Delhi-I - 2015 (37) S.T.R. 848 (Tri. - Del). 6. CST Mumbai-1 Vs. Sai Services Station Ltd. 2014 (35) STR 625 (Tri.Mum). 7. JAC Air Services Pvt. Ltd. Vs. Commissioner of Service Tax, Delhi - 2013 (31) STR 155 (Tri.Del) 8. Navyug Alloys Pvt. Ltd. Vs. Commr. Of C. Ex. & Cus., Vadodara-II - 2009 (13) S.T.R. 421 (Tri-Ahmed) 9. MSPL Ltd. Vs Commissioner of Central Excise, Belgum - 2009 (13) S.T.R. 554 (Tri. - Bang.) 10. Government of India Vs. Polisetthy Somasundaram Pvt. Ltd. - 1999 (113) E.L.T. 378 (S.C.). 11. Premier Tyres Ltd. Vs. Collector of Central Excise, Cochin - 1987 (28) E.L.T. 58 (S.C.) 12. Ajay Hasia Vs. Khalid Mujib (AIR 1981) SC 487. 13. APIT Co. Ltd. Vs CST - (2010) 2....
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....in the adjudicating authority's order and draws our attention to the same. 7. We have considered the submissions made by both sides and perused the records, The factual matrix which are undisputed are, appellants herein had entered into works contract with various companies as also APIICL, KTPS and others for executing the jobs undertaken by them. The contracts which were perused by the lower authorities indicated and as recorded in the order-in-original that these contracts were EPC contracts. The period involved in this case is from 2006-07 to 2010-11. 8. The entire case needs be decided based upon the periods involved. 9. For the service tax liability on the amounts received as consideration for executing works contract prior to 01.06.2007, the amount of turn over considered by the lower authorities in the order-in-original is Rs. 12.35 crores. It is on record that the work executed on these contracts is works contract and on perusal of the same it is so, and if that be so, the law which is settled by the Apex Court in the case of Larsen and Toubro Ltd would cover the issue in favour of the appellant. Accordingly, we hold that service tax liability prior to 01.06.2007 o....
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....ce tax liability under works contract under composition scheme for the projects executed by them for the appellant, in our view once the service tax liability due on the entire contract executed by sub-contractor is discharged, there is no reason for demand of any further service tax from the appellant. On this point itself, we hold that the service tax liability demanded from the appellant is liable to be set aside. Learned A.R points out that the certificate issued by M/s Sudhama Projects India Pvt Ltd indicates discharge of approximately Rs. 1.77 crores as tax while demand from the appellant is Rs. 5.71 crores. We find that this objection is also incorrect as M/s Sudhama Projects have clearly indicated in their certificate that they have discharged the service tax liability based upon composition scheme @ 2% or 4% of the contract value as the case may be. The difference in our view, is due to the full tax demanded from the appellant and the tax discharged by M/s Sudhama Projects India Pvt Ltd under composition scheme. We do not find any reason to sustain such a demand raised against the appellant and hold that such demand is liable to be set aside and we do so. B. As regards ....
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....covered under clause (i) and (ii). In the case in hand, the contracts executed by the appellants with APSHCL and APIICL are works contract, an undisputed fact. The said contracts would definitely be covered under definition of works contract services under the Finance Act 1994 as it satisfied clause (i) of the said definition. We find that to tax such contracts, the services has to also get covered under (i) and (ii). We refer to clause (b) in (ii) which would indicate that when there is construction of new building or a civil structure or a part thereof, primarily for the purpose of commerce or industry, then only, the same gets covered under Section 65(105(zzzza) and liable to be taxed. In the case in hand, we find that there is no allegation or any finding indicating that the buildings constructed by appellant for APSHCL and APIICL were for the purposes of commerce or industry. We find that in the absence of any such finding, the decision of the Larger Bench of the Tribunal in the case of Lanco Infratech would cover the issue in favour of the appellant. In the said judgement, the larger bench went into details of the taxability or otherwise of works contracts prior to and post 0....
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.... being State Govt entity are not required to service tax liability. In our view appellant could have entertained a bonafide impression that once State Govt entity indicates/informs them that service tax liability is not dischargeable, they need not discharge any service tax liability. On limitation also, the demands fails for APIICL and APSHCL up to 2009-10. B.2 As regards the service tax liability of the consideration received by the appellant for executing the projects given to them by KTPS, we find that such project was for laying foundation of the boiler of KTPS. Appellant had claimed the benefit of Notification No. 45/2010 dated 20.07.2010 which has been issued under Section 11C of the Central Excise Act 1944 with retrospective effect. The said notification reads as under: "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 a....
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.... P. Ltd. - 1988 (36) E.L.T. 201 (S.C.). Therefore, all taxable services rendered in relation to transmission/distribution of electricity would be eligible for the benefit of exemption under the said Notification for the period prior to 27-2-2010. 6. As regards the demand for the period w.e.f. 27-2-2010, the said exemption is available if the taxable services are rendered for transmission of electricity. As held by the Hon'ble Apex Court in the case cited supra the expression "for" means 'for the purpose of'. As per the definition of transmission (given in the Electricity Act, 2003), it covers a very wide gamut of activities including sub-station and equipments. Therefore, the various activities undertaken by the appellant, though classifiable under Commercial or Industrial Construction prior to 1-6-2007 or under works contract service on or after 1-6-2007, would be eligible for the benefit of exemption as held by this Tribunal in the case of Noida Power Co. Ltd., Pashchimanchal Vidyut Vitran Nigam, Purvanchal Vidyut Vitran Nigam and Shri Ganesh Enterprises cited supra. Therefore, the confirmation of Service Tax demand in respect of the construction, maintenance or repair a....