TaxTMI 
TaxTMI 
2019 (3) TMI 979
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.... the construction of Shiv Chatrapati Sports Complex is commercial or industrial construction within the meaning of Section 65(25b) of the Finance Act ? The brief facts of the case are as under: 2. It is the appellant's case that the respondent is engaged in providing taxable services, including 'commercial or industrial construction services' as defined under Section 65(25b) of the Finance Act, 1994. During the course of verification of service tax payment, it was noticed that the respondent had provided services to the Directorate of Exports and Huge Services to the Government of Maharashtra for construction of new facilities and up­gradation of the existing facilities at Shiv Chatrapati Sports Complex situated at Mhalunge­ Balewadi, Pune. It was observed that the services provided by the respondent at the aforesaid place are covered under the category of 'commercial or industrial construction services' as the said stadium/sports complex is used for commercial purposes. The respondent did not pay service tax though they are liable. 3. A show cause notice dated 22/03/2009 was issued to the respondent demanding service tax of Rs. 10,21,11,459/for....
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.... the queries raised by the Competent Authority of Government of Maharashtra, regarding leviability of service tax on the construction services availed for construction of sports stadium. In his submission, the Tribunal has failed to appreciate the materials brought on record indicating various rates specified for the user of different facilities in the sports complex. In his submission, the record clearly reveals that the construction is a commercial construction for which the appellant is justified in levying service tax. 7. Learned Counsel invited our attention to the findings given in the adjudication order by the adjudicating authority which clearly records that the rates are fixed for use of the stadium. He points out that in the rates quoted, there is a column for usage for commercial purposes which clearly reveals that the stadium is being allowed to be used for commercial purposes and separate rates are fixed for such usage. Learned Counsel by placing reliance on the Government Resolution which provides that the Committee shall be competent to use the area to the extent of 1/3rd of the total area for commercial purpose, that is to say, for private purpose, would submit t....
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....vice tax." 9. Learned Counsel also relied on the Circular dated 10/02/2012 whereunder following clarifications are issued. "2.4 Conversion Model: Conversion of any hitherto untaxed constructions/complex or part thereof into a building or civil structure to be used for commerce or industry, after lapse of a period of time. Clarification : Mere change in use of the building does not involve any taxable service, unless conversion falls within the meaning of commercial or industrial construction service." 10. Learned Counsel would submit that even the records maintained by the local authorities would reveal that the stadium is not used for commercial purposes. Learned Counsel would submit that it is only when sports stadium is to be used primarily for the purpose of commercial or industrial use, it is only then the question of payment of service tax would arise. 11. We have heard learned Counsel for the parties. We have gone through the Petition and the annextures. 12. To appreciate the controversy involved, it is material to refer to the definition of the term 'commercial or industrial construction service' as defined under Section 65(25b) of the Finance A....
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....icient to establish that the sports complex is exclusively or primarily used for commercial purpose. The agreement itself permits the Committee to use the area to the extent of 1/3rd of the total area for commercial purpose. 15. Let us consider the definition of the term 'commercial or industrial construction service' which is extracted hereinbefore. Clauses (a) to (d) of the definition provides for various types of construction and allied works including glazing, plastering, painting etc. and also repair, alteration, renovation etc on which service tax can be levied. This construction of the allied works ipso facto does not attract the levy of the service tax as further part of the definition would indicate. The said construction, in order to attract service tax, will also have to satisfy the conditions laid down by subsequent part of the definition i.e. i) used, or to be used, primarily for ; or ii) occupied, or to be occupied, primarily with ; or iii) engaged, or to be engaged, primarily in, commerce or industry, or work intended for commerce or industry........ (emphasis supplied by us) 16. The language employed in the definition clause is clear and unamb....