2019 (9) TMI 1143

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....urchased residential flats constructed by the builder M/s. Ceebros during the year 2006. The appellants had entered into separate agreements for construction with the builder for construction of flats. The contract for construction was a composite one which included supply of goods and services. The flats were handed over to the appellants prior to 12.4.2007. Service tax was collected from the appellants under the category of 'Residential Complex Service' by the service provider and paid to the Government. Later, the levy of service tax on composite contracts in respect of the construction activities including construction of residential complex service was held to be unconstitutional as per the decision of the Hon'ble Apex Court in the....

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....therefore the levy and collection of service tax from the appellants cannot sustain. 3.1 It is also argued by the ld. counsel that the Hon'ble Apex Court vide the decision in Larsen & Toubro (supra) has held that no service tax can be levied on composite contracts prior to 1.6.2007. Construction of residential complex is included in works contract service. Thus, while discussing the works contract service, the Hon'ble Apex Court has also referred to construction of residential complex service which are in the nature of composite contracts and held that prior to 1.6.2007, the levy of service tax on such construction is unconstitutional. For this reason, the levy cannot sustain and the appellants are eligible for refund. 3.2 The appella....

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....he Circular dated 29.1.2009 is not applicable to the appellants. From the facts, it is seen that the appellants have individually entered into an agreement with the service provider for construction of flat and thereafter the construction was started and after completion of construction, the flats were handed over to the appellants prior to 12.4.2007. These facts have not been disputed by the department. Para 3 of Circular No. 108/02/2009 dated 29.1.2009 clarifies that if the purchaser enters into an agreement for construction of residential complex with the builder and the builder provides the services for construction and after such construction, the purchaser received such property for his personal use, then such activity would not be su....