2023 (10) TMI 228

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....g and constructing Residential Complex at Zirakpur having more than twelve Residential units, a taxable service w.e.f. 16.06.2005 under the category of "Construction of Complex Services" and were registered under the Service tax law. However, it was observed by the department that although the appellant was registered with the department under the category "Construction of Complex Services" but the appellant had neither submitted the periodical returns nor had deposited the service tax liability w.e.f. 1.04.2006. During investigation, it was observed that the appellant had received an amount of Rs. 4,50,21,147/- from their prospective buyers during April 2006 to September 2007, involving Service tax of Rs. 18,19,099/- calculated on the taxa....

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.... tax. 4.2 Ld. Counsel further submits that an activity undertaken by a Real estate builder/developer is liable to tax w.e.f 01-07-2010 only with the insertion of Explanation under Section 65(105) (zzzh) to the Finance Act, 2010. 4.3 Ld. Counsel further submitted that this issue is no more res-integra and has been settled by the Tribunal in various decisions cited below:- • 2019(26) GSTL 227 (CCE & ST v/s Keerthi Estates (P) Ltd) • 2020(34) GSTL 550 (M/s Ashoka Devlopers & Builders Ltd V/s CCE & ST) • 2013(32) STR 738 (CCE, Chandigarh v/s U.B. Construction (P) Ltd) • 2012(27) STR 388 (CCE v/s Skynet Builders, Developers, Colonizer) • 2013(29) STR 527 (CCE Chd v/s Green Vi....

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....nation was added [by] the Finance Act, 2010 in Section 65(105)(zzzh) of the Finance Act, 1994 whereby it was clarified that levy of service tax on construction of complex by builder will be taxable only from 1-7-2010 and further the Board vide its Circular dated 10-2-2012 clarified that prior to 1-7-2010 service tax is not chargeable from builders/developer. Further we find that this issue has been considered by the Division Bench of this Tribunal in the case of CCE v. U.B. Construction (P) Ltd. cited supra wherein the Tribunal in Para 5 has observed as under : "5. In Maharashtra Chamber of Housing Industry v. Union of India - 2012 (25) S.T.R. 305 (Bom.), the validity of the 'Explanation' added to Sections 65(105)(zzq) and (zzzh) w....

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....to by a builder/promoter/developer with prospective buyers for construction of residential units in a residential complex against payments being made by the prospective buyers in instalments during construction and in terms of which the possession of the residential unit, is to be handed over to the customers on completion of the residential complex and full payment having been made, are to be treated as works contracts, it has to be held that during the period of dispute, there was no intention of the Government to tax the activity in terms of such contracts a builder/developer with prospective customers for construction of residential units in a residential complex. Such works contracts involving transfer of immovable property were brough....

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....ttled in the case of Kolla Developers and Builders (supra) and M/s. Mehta and Modi Homes (supra) by the Tribunal. We also find that the C.B.E. & C. has also clarified that prior to 1-7-2010 no service tax is chargeable on such services. Accordingly, the demand of service tax for the period prior to 1-7-2010 needs to be set aside and we do so. As far as the period post 1-7-2010 is concerned, Learned Counsel for the appellant submits that they have already discharged service tax for this period and had filed ST-3 returns. In view of the above, the demand for service tax for the period prior to 1-7-2010 is set aside and the demand for service tax post 1-7-2010 is confirmed which according to the Learned Counsel for the appellant has already be....