TaxTMI 
TaxTMI 
2023 (10) TMI 431
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....-was confirmed along with interest. Penalty equal to service tax confirmed was also imposed under section 78 of the Finance Act, 1994 along with Penalties under section 76 and 77 of the Act. Aggrieved against the impugned order, the Appellant ( M/s Laing-Simplex JV ) has filed this appeal. 2. Briefly stated facts of the case are that the Appellant had entered into two agreements dated 31/08/2006 with the Executive Engineer, Ranchi, Government of Jharkhand for construction of a Mega Sports Complex at Ranchi for hosting 34th National Games. The Government of Jharkhand has separately appointed a consulting engineer for planning, design, engineering, project management and other related services for development and construction of the said spo....
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....s, they contended that their activity is not classifiable under clause (ii) (e) of the Explanation to Section 65(105)(zzzza) of the Act. Their activity is of construction of building and allied services which is primarily classifiable under clause (ii) (b) of section 65(105)(zzzza) which covers 'Construction of a new building or a civil structure or a part thereof, or of a pipeline or conduit, primarily for the purpose of commerce or industry'. However since the Sports Complex is not primarily meant for commerce and business, the same is not liable to service tax. The fact of non-usage of Sports Complex for commercial purpose was also certified by the Executive Engineer, Special Works Division. The Mega Sports Complex also contains restaura....
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....rder. 7. Heard both sides and perused the appeal documents. 8. We observe that the issue to be decided in the present appeal is whether the activity of construction of Mega Sports Complex for hosting 34th National Games by Government of Jharkhand would amount to Works Contract Services as defined under Section 65(105)(zzzza) of the Finance Act, 1994. For the purpose of ready reference the said section is reproduced below: "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 ....
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....ppellant that the facilities like Restaurants, VIP Guest house, Hotel facility etc. is only for the purpose of making the sports complex habitable and functional and in accordance with international standards. The same in no way make the Sports complex is meant for commercial purposes. Accordingly, we are of the view that the activity of the Appellant are covered under Clause (b) of the definition of 'Works Contract Service' mentioned above. We observe that this view has also been taken by the Hon'ble Bombay High Court in the case of CCE&ST Pune Vs B J Shirke Construction Technology Pvt Ltd [2019 (25) GSTL 8 (BOM)]. The relevant part of the decision is reproduced below: "13. There is no dispute that the plot of land on which t....
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....the term 'commercial or industrial construction service' which is extracted hereinbefore. Clauses (a) to (d) of the definition provides for various types of construction and allied works including glazing, plastering, painting etc. and also repair, alteration, renovation etc on which service tax can be levied. This construction of the allied works ipso facto does not attract the levy of the service tax as further part of the definition would indicate. The said construction, in order to attract service tax, will also have to satisfy the conditions laid down by subsequent part of the definition i.e. (i) used, or to be used, primarily for; or (ii) occupied, or to be occupied, primarily with; or (iii) engaged, or to be engaged, primari....
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....ly if such constructions are for commercial purposes, like, local government bodies constructing shops for letting them out, such activities would be commercial and builders would be subjected to service tax. The Director of Sports and Youth Services, Pune in his Affidavit filed before the authorities on earlier occasion has deposed that the stadium will be continued to be used for the noncommercial purposes even after the Commonwealth Youth Games, 2008 are over. The materials on record do not satisfy the test that the stadium is used or used primarily for commercial purpose. It is the stand of the respondent that while pursuing their object of popularizing sports by selecting best available means, they incidentally charge for the usage and....