TaxTMI 
TaxTMI 
TaxTMI 
2023 (9) TMI 79
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....fts. On verification of records of the appellant, the Revenue appeared to have noticed the appellant's payment of Service Tax only on 15% of the total value of works contract which, upon enquiry, revealed that on the balance 85% of the works contract value, they are paying VAT. It was thus claimed by the appellant that the balance 85% of the value of contract was not amenable to Service Tax. 1.2 It appears that during further verification, the appellant revealed that the payment of VAT for works contract was made as per the prevailing / respective State VAT law, States allowed standard deduction as 15% except the State of Andhra Pradesh wherein such standard deduction was 30%. By this, the Revenue entertained a doubt that the payment o....
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....et that the issue of works contract having not been denied by the Revenue and also there being no denial as to the payment of VAT as per the respective VAT Acts at the prevailing rates, the issue of demanding Service Tax under the pretext of the valuation being not in accordance with Rule 2A of the Service Tax Valuation Rules is already settled by the Hon'ble Supreme Court in its decision in the case of M/s. Safety Retreading Co. (P) Ltd. v. Commissioner of C.Ex., Salem [2017 (48) S.T.R. 97 (S.C.)]. He would also rely on the following orders of this Bench of the Tribunal in the appellant's own cases for different periods: - i. Johnson Lifts Pvt. Ltd. v. Commissioner of Service Tax, Chennai [Final Order No. 41790 of 2017 dated 21.08.2017 i....
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....uted fact is that the appellant provided works contract; it also discharged VAT at a certain percentage, admittedly as prescribed by the relevant States. In order to ascertain the correctness of the appellant's claim, it appears that even the Chief Commissioner authorised a cost accountant to verify the same. We find that reports of the said cost accountant are placed on record at page numbers 123 to 127 and 93 to 97 of the respective appeal memoranda, wherein even the said cost accountant has clearly specified the State-wise details of the percentage of material portion and the service portion on which the respective VAT and service tax to be paid for the years 2012-13 and 2013-14. This, according to the appellant, has been followed by....
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....scribe to the view held by the Majority in the Appellate Tribunal that in a contract of the kind under consideration there is no sale or deemed sale of the parts or other materials used in the execution of the contract of repairs and maintenance. The finding of the Appellate Tribunal that it is the entire of the gross value of the service rendered that is liable to service tax, in our considered view, does not lay down the correct proposition of law which, according to us, is that an assessee is liable to pay tax only on the service component which under the State Act has been quantified at 30%." 9.2 The above view has been followed by this Bench of the CESTAT in the assessee's own case for a different period vide Final Order No. 41790 of ....
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.... find any grounds for sustaining the demand of Rs.2,51,202/- and the same is set aside. The demands for differential tax liability / recovery of credit having been set aside, the penalties imposed will also not sustain." (Emphasis supplied) A similar view was also expressed by this Bench in the assessee's own case vide Final Order No. 40922 of 2018 dated 22.03.2018 (supra). 9.3 Further, in the case of M/s. Touchstone Infrastructure and Solutions Pvt. Ltd. (supra), the Bench had observed as under: - "2. The facts of the case, after filtering out unnecessary details, are that the appellant provides finishing services on works contract basis to various parties. This work includes providing false ceiling, flooring, glazing, fixing up of p....
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.... for service portion of works contract if such consideration is available in the contract/invoice separately, otherwise service tax must be paid under the "Works Contract (Composition Scheme for payment of Service Tax) Rules, 2007 upto 30.06.2012. For the period after 01.07.2012, the value of service portion of works contract of composite nature has to be arrived at as specified in Rule 2A (ii) of Service Tax (Determination of Value) Rules, 2006, as amended. Thus, there are two periods in question upto 30.06.2012 and thereafter. ... 6. The case of the appellant is that the composition scheme is an option given to the appellant and it cannot be forced upon it. Revenue also cannot choose any option for the appellant who is free to choose ....