TaxTMI 
TaxTMI 
TaxTMI 
2023 (9) TMI 295
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....ndustrial Buildings and Civil Structures, d) business Support Services, e) Cab Operators and f) Erection Commissioning and Installation Services. Audit of the accounts of the Appellant was conducted for the period July 2007 to September 2010 and Audit Report dated 22.02.2011 was issued. As per the Audit Report, the Appellant has to pay an amount of Rs.50,37,496/- as Service Tax along with interest, for non-payment of Service Tax payable on contract receipts, under the categories of Erection, Commissioning and Installation Services, on the taxable amount of Rs.4,65,11,026/-received by them during the relevant period. The relevant extract (in tabular format) of the Audit Report is as follows: Year Taxable Amount ST Ed. Cess S. & H.E.....
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.... other main contractors namely, M/s.L&T, M/s Stewards & Lloyds Ltd., & M/s Tata Projects, they stated that they have not realized any service tax from the main contractors. As the main contractors have paid service tax on the fill value of services realized by them, the sub-contractors are not liable to pay service tax again. 6. The Appellant further stated that the entire issue was raised by the department based on the Audit Report dated 22.02.2011. They have not suppressed any information from the department and hence the demand is not sustainable on the ground of limitation also. Accordingly, they prayed for setting aside the impugned order. 7. The Ld. A.R cited CBEC Circular No. 96/7/2007 ST dated: 23.08.2007 and contended that as per....
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....cessitated because the Lead Consortium Partner was qualifying all criteria for allotment of the work by BHEL, except the criteria of Fabrication and Erection of structural works. Accordingly, BHEL allowed the First Bidder M/s Rajshekhar Constructions Pvt. Ltd. to form a Consortium and to meet the qualifying criteria. Accordingly, a 'Consortium' was formed with M/s Rajshekhar Constructions Pvt. Ltd as the Lead Partner and the Appellant as an individual partner. Both the Consortium partners are jointly and severally liable for execution of the work order. As per the consortium agreement, no bill will be paid to individual consortium partners. The Lead Partner M/s Rajshkhar Constructions Pvt. Lts raised all the bills to BHEL along with....
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.... have not collected service tax from the main contractors and hence the demand of service tax on them is not sustainable. 11. We observe that Board has issued Circular No. 96/7/2007 ST dated: 23.08.2007, wherein the liability service tax by the sub-contractor on the services rendered to the main contractor has been clarified. The relevant part of the Circular clarifying the said issue is reproduced below: 999.03 / 23.08.07 A taxable service provider outsources a part of the work by engaging another service provider, generally known as subcontractor. Service tax is paid by the service provider for the total work. In such cases, whether service tax is liable to be paid by the service provider known as sub-contractor who undertakes only pa....
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....n from the department and hence extended period not invocable in this case. Accordingly, they contended that the penalty imposed in the impugned order under Section 78 of the Finance Act, 1994 is not sustainable. 14. We observe that there were contradicting decisions of Tribunal, before issue of the Circular No. 96/7/2007 ST dated: 23.08.2007 clarifying the issue. The clarification issued also clearly states that the service tax paid by the Appellant would be available as credit to the main contractor. Thus, the entire issue is revenue neutral. We observe that the Appellant has not collected the service tax from the main contractors. Hence, we observe that there was no mensrea established on the part of the Appellant to evade payment of se....