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TaxTMI 
TaxTMI 
TaxTMI 
2023 (12) TMI 1109
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....come Tax declaration in survey operation. 2. Of the above, the Commissioner dropped the demand on "Commercial and industrial construction service", "management and maintenance and repair service" and "service tax demand based on income declaration in survey operation". He partly confirmed and partly dropped the demand on "construction of complex service" and to the extent it was confirmed the assessee is not contesting and has already paid the entire tax with interest. He upheld the demand on site formation service. 3. Aggrieved by the confirmation of demand on site formation service, the assessee filed Service Tax Appeal No. 55788/2014. Revenue filed Service Tax Appeal No. 55922/2014 assailing the dropping of demand under the head "Commercial and Industrial Construction" service for the services rendered to educational institutes and to office of Tehri Corporation and on "construction of complex services". Revenue is also aggrieved by dropping of demand of service tax "based on declaration to the income Tax department survey". There is no appeal by either side with respect to management, maintenance and repair services. 4. We have heard learned counsel for the assessee and lear....
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....e assessee should not be appropriated against the demand at (iii) above; (vii) Interest under the provision of Section 75 of the said Act should not be demanded and recovered from them. (viii) Interest amounting to Rs. 12,22,490/- (Rupees Twelve Lac Twenty Two Thousand Four Hundred and Ninety only) (as per details mentioned in paragraph 37.3.1 above) already deposited by the assessee should not be appropriated under Section 75 of the Act ibid, (ix) Penalty under Section 76 of the Act ibid for their failure to pay the Service Tax during the relevant period should not be imposed upon them, in accordance with the provision of Section 68 of the Act ibid read with Rule 6 of Service Tax Rules, 1994; (x) Penalty under Section 77 of the Act ibid should not be imposed upon them for contravening the Section 70 of the Act ibid read with Rule 7 of the Service Tax Rules, 1994; and (xi) Penalty under Section 78 of the Finance Act, 1994 should not be imposed upon them for deliberately suppressing the facts and contravening the provisions of the Law with willful intention to evade payment of Service Tax. 6. The assessee contested that demand which was partly confirmed and partly dropped....
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.... extraction services for construction, geophysical, geological or similar purposes; or (ii) soil stabilization; or (iii) horizontal drilling for the passage of cables or drain pipes; or (iv) land reclamation work; or (v) contaminated top soil stripping work; or (vi) demolition and wrecking of building, structure or road, but does not include such services provided in relation to agriculture, irrigation, watershed development and drilling, digging, repairing, renovating or restoring of water sources or water bodies;" 8. Learned counsel for the assessee submitted as follows: (i) The demand has confirmed on site formation service as defined under section 65 (97a) of the Finance Act and taxable under section 65(105) (zzza) incorrectly because the 'site formation service' rendered in relation to agriculture is not taxable and is beyond the scope of the definition of taxable service. (ii) The Commissioner did not agree with the submissions by the appellant that the service was rendered in relation to agriculture holding that it was rendered to the client for investment purpose. Even if it is accepted to be true, the investment purpose was on the owner of the land is irre....
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....te and, therefore, it was not exempted from tax. The demand, therefore, needs to be upheld. 10. With respect to the Revenue's appeal learned authorized representative appearing for the department submitted that adjudicating authority had incorrectly dropped the demand on account of 'commercial or industrial construction service' on the services rendered by the assessee by way of constructing three buildings of Aligarh Muslim University, construction of boys hostel and flats at IIT Roorkee and Tehri Hydro Development Corporation. The demand was dropped by the adjudicating authority relying on CBEC Circular No. 80/10/2004-ST dated 17.09.2004 which was withdrawn by Circular No. 96/7/2007-ST dated 23/08/2007. Educational institutes, per se, were not excluded from the ambit of definition of Commercial or instruction construction service. 11. The definition of "commercial and industrial construction" under section 65 (25b) is reproduced below: "Commercial or Industrial Construction" means - (a) construction of a new building or a civil structure or a part thereof; or (b) construction of pipeline or conduit; or (c) completion and finishing services such as glazing, plastering, p....
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....on of 42 blocks comprising 504 residential units in total at different locations in Gonda District for providing accommodation to weaker sections. There was no specific exemption to the services rendered by the assessee and, therefore, the Commissioner should have confirmed the demand on the services under construction of complex service. 15. The assessee had declared an amount of Rs. 10 crores during income tax survey and it was alleged in the SCN that since the assessee was engaged in business of construction of civil structures either residential or commercial the aforesaid income declared was earned by providing service of construction only. The adjudicating authority dropped the demand holding that the income declared to the income tax department has no co-relation with the service provided. The adjudicating authority erred in not appreciating that in the declaration before the income tax authorities, the director of the assessee Shri Jameer A Khan, said that the amount was collected from various investors in March, 2007 to launch real estate projects. This statement was not considered as correct by the Revenue as the balance sheet of the notice for the relevant period reveal....
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....endered by the appellant are excluded as being provided in relation to agriculture. Nothing in the records suggests that the service recipient builders were engaged in agriculture, although the land was during the relevant period was agricultural land. Evidently, the land was meant for developing into real estate although such development can take place only after the land was is got converted into non-agricultural land by the land revenue authorities. Unsurprisingly, the contracts do not mention that the site formation must be done by the appellant for non-agricultural purposes because non-agricultural activities could not have been taken up on the land before it was converted to non-agricultural land. Seeing the contracts as a whole, it is evident that the purpose of site formation was for the builder to develop it into real estate and it was not for agricultural purposes. Learned counsel for the appellant relied on the order of the Tribunal of co-ordinate bench in the case of ASSOTECH Limited vs. Commissioner of Central Excise & Service Tax, Meerut-I [2020 (43) GSTL 198 (Tri-All)] in which it was held that the services rendered by M/s ASSOTECH to M/s Aero Intra for supply of mud....
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....r "commerce or industry". By no stretch of imagination can we call the amounts collected by the Aligarh Muslim University when the buildings are used for campus recruitment as commercial activity. Even if it is considered as a commercial activity, the building is not primarily for commerce or industry. Similarly universities, as a matter of course, provide consultancy services as a part of their extension programmes and do collect some consultancy fee when such services are provided. That does not make them organizations primarily engaged in commerce or industry nor can a building which is used for providing such consultancies be considered as a building primarily for commerce or industry. 22. We also do not agree with the contention of the Revenue that the hostels in IIT constructed by the assessee should be considered as buildings primarily for commerce or industry simply because some hostel fees is collected from students by the IITs. Similarly, Tehri Hydro Electric Development Corporation is national project meant for generating hydro electricity and supplying it. Needless to say when the electricity is generated the generator company sells it to the transmission company who, ....
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....encing and railing, construction of swimming pools, acoustic applications or fittings and other similar services; or (c) repair, alteration, renovation and restoration of, or similar services in relation to residential complex." "Section 65(91a) "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 purpose of this clause,- (a) "personal use" includes permitting the complex for use as residence by another person or rent or without consideration; (b) "residential unit" means a single house o....