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2023 (4) TMI 438
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....udgments:- (a) M/S Ganpati Mega Builders (India) Pvt. Ltd. vs. Commissioner, Customs, Central Excise & Service Tax, Agra - 2021 (8) TMI 294 - Cestat Allahabad (b) M/S Jethanand Arjundas & Sons Versus CCE & S.T. Indore - 2018 (11) TMI 757 - Cestat New Delhi (c) C.C. & C.E. & S.T. Allahabad vs. Ganesh Yadav 2017 (5) TMI 1251 Cestat Allahabad (d) Ms Khurana Engineering Limited vs. Commissioner of Service Tax, Ahmedabad - 2022 (12) TMI 1053 - Cestat Ahmedabad (e) Shri Santosh Katiyar Versus CCE, Bhopal - 2017 (3) TMI 1371- Cestat New Delhi (f) M/S. Sima Engineering Constructions, S. Rajangam, T.M. Saravanan, M/S. Marimuthu Gounder & Sons vs. CCE, Trichy - 2018 (5) TMI 405 Cestat Chennai (g) C R Patel Tribunal Order - Order No. A/10185/2023 dated 31.01.2023. He submits that in view of above judgments, directly on the issue, the issue is no longer res-integra. 3. Shri G. Kirupanandan, learned Assistant Commissioner (AR) appearing on behalf of the Revenue reiterates the findings of the impugned order. 4. On careful consideration of the submissions made by both the sides and perusal of record, we find that in the prese....
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....t 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 personaluse as residence by such person. Explanation : For the removal of doubts, it is hereby declared that for the purposes of this clause. - (a) "personaluse" 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;" The perusal of the above definition makes it dear that the complex which is constructed with an intention for personal use as residence by a person who is directly engaging any other person for designing/planning of layout and the construction of such complexes out of the ambit of such construction and thus from taxability. We draw the support from the case of C.C.E., Aurangabad v. Mall Enterprises - 2016 (41) S.T.R. 119 (Tri.-Mum.) wherein it was he....
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....as clarified that Service Tax would not be leviable on construction of complexes under question if their lay out does not require approval by an authority under any law for the time being in force. From the letter dated 30-1-2004 issued by the M.P. Urban Development Department, it appears that the said construction was made under "Rajiv Gandhi basti Vikas karyakram" which was the Central sponsored scheme and the same is exempted from service tax as per Circular No. 125/2010-S.T., dated 30th July, 2010. 5. In the light of above discussion and by considering the facts and circumstances of the case, we are of the view that the M.P Government has constructed the accommodation for the gandi basti people under the Central sponsored scheme which is attempted to clean India as per Prime Minister's mission. 6. When it is so, then we find no merits in the impugned order as no service tax is leviable in the instant case. Hence, the impugned order is set aside. The appellant will get the relief accordingly. From the above judgment it can be seen that the identical fact is involved in the above judgment and in the case in hand in as much as in both the cases the const....
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....oustic applications or fittings and other similar services; or (c) repair, alteration, renovation or restoration of, or similar services in relation to, residential complex;] As per Section 65(91a) of the Finance Act, 1994 '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) "residen....
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....t with GOI, engages a sub-contractor for carrying out the whole or part of the construction, then the sub-contractor would be liable to pay Service Tax as in that case, NBCC would be the service receiver and the construction would not be for their personal use." It can be seen that if the land owner enters into a contract with a promoter/builder/developer who himself provided service of design, planning and construction and if the property is used for personal use then such activity would not be subject to service tax. It is quite clear that C.B.E.&C. also has clarified that in cases like this, service tax need not be paid by the builder/developer who has constructed the complex. If the builder/developer constructs the complex himself, there would be no liability of service tax at all. Further in this case it was different totally, the appellant, has engaged sub- contractors and therefore rightly all the sub-contractors have paid the service tax. In such a situation in our opinion, there is no liability on the appellant to pay the service tax." 8. The said decision was followed by the Tribunal in the case of Lanco Tanjore Power Co. Ltd. (supra) wherein the Tribuna....
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....are allowed with consequential reliefs, if any." (b) In the case of C R Patel (supra), this bench of Tribunal passed the following order:- "4. We have considered rival submissions. We find that so far as the period prior to 01.06.2007 is concerned it is not in doubt that the demand has been made in the category of "works contract service". The works contract service was not taxable prior to 01.06.2007 has held by Hon'ble Apex Court in the case of Larsen & Toubro Ltd (Supra) , consequently the demand for the period 01.06.2007 made under the category of the "works contract service is set aside. 4.1 So far as the period after 01.06.2007 is concern it is seen that the definition of the above "works contract service" reads as under: "Works contract", for the purposes of section 65(105)(zzzza), means a contract wherein,- (i) transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods, and (ii) such contract is for the purposes of carrying out,- (a) erection, commissioning or installation of plant, machinery, equipment or structures, whether pre-fabricated or otherwise, installation of electrical and elec....
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.... by another person on rent or without consideration. In this case what emerges is that ITC intended to provide the accommodation built to their own employees. Therefore it is covered by the definition of 'personal use' in the explanation. The next question that arises is whether it gets excluded under the circumstances. The circular issued by C.B.E.&C. on 24-5- 2010 relied upon by the learned counsel is relavant. Para 3 of this circular which is relevant is reproduced below : "3. As per the information provided in your letter and during discussions, the Ministry of Urban Development (GOI) has directly engaged the NBCC for constructing residential complex for Central Government officers. Further, the residential complexes so built are intended for the personal use of the GOI which includes promoting the use of complex as residence by other persons (i.e. the Government officers or the Ministers). As such the GOI is the service receiver and NBCC is providing services directly to the GOI for its personal use. Therefore, as for the instant arrangement between Ministry of Urban Development and NBCC is concerned, the Service Tax is not leviable. It may, however, be pointed out th....
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....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;" The above definition specifically excludes construction undertakenfor personal use and such personal use includes permitting the complex for use as residence by another person. We find that the above exclusion clause covers the construction activity undertaken by the assessee. 8. We have gone through the case law relied upon by the respondents where a similar case has been dealt with by the Tribunal. Following the decision of the Tribunal in Nithesh Estates Ltd. (supra), we find no reason to interfere with the impugned orders which are sustained and the appeals filed by Revenue are rejected." 4.4 Similar view has also been taken in the case of Khurana Engineering2010 (11) TMI 81 CESTAT -Ahmd, wherein foll....
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....nded over to NBCC who in turn handed over the same to Govt. of India, service tax would be leviable. He drew our attention to the observation of learned Commissioner in his order wherein he has also held that this is not a case where residence is for personal use of a person and is not covered by the explanation given under clause (30a). We have considered this submission. We find ourselves in agreement that the contention of the learned advocate that service has been provided by the appellant to Govt. of India in this case and CPWD and Income Tax department cannot be treated as separate entities just because service has been provided to CPWD who in turn handed over the same to Income Tax department. Further, learned advocate also drew our attention to the notice issued by the CPWD inviting tenders. The tender starts with words "Tenders are invited on behalf of the President of India". Further, we also find that the guarantee executed by the contractor and agreement entered by the contractor have been accepted by CPWD for and on behalf of the President of India. Learned DR also fairly admitted that he has not got any clarification from the department as to whether there is any evid....
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....anning 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."] We have already explained the submission of learned advocate in brief and as explained by him in this case, residential complex constructed by the appellant is meant for use by the Income Tax department to provide the same on rent to the employees and therefore, it is clearly covered by the explanation given for "Personal use" in the definition. In this case the CPWD has engaged the appellant for construction of residential complex for giving it on rent to the employees of Income Tax department and therefore this service cannot be included in the definition of residential complex services. It is basically the case of one department taking the help of another department to get the work done basically because of specializ....