TaxTMI 
TaxTMI 
2024 (4) TMI 232
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....ruction designing, supplying, erecting, installing commission of Electrical equipment's for lumpsum price to Airport Authorities, C.P.W.D., Defence and paramilitary organizations such as BSF, CRPF, ITF etc., in term of agreement so entered into with its customers and the appellants were responsible to hand over the functional systems to its customers. 3. It has been further alleged that the appellant used to quote the price in form of consolidate consideration for the entire contract/work without bifurcating into two parts namely; supply of goods and for services rendered. The works contract so executed was indivisible and could not be vivisected into sale of goods and rendering of services for levy of service tax. The appellant was also registered with the Sales Tax Department and was filing Sales Tax returns regularly. On 26.06.2008, an audit team visited the appellant's premises to conduct audit it's account and after conducting the audit for two days the audit team prepared the Audit Objection Memo and presented the same before the Assistant Commissioner Audit, who appended his dated signature on 23.08.2008 as token of its acceptance. 4. Thereafter, a show cause notice dated ....
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....ure just as tax liability arises on ancillary activities of civil construction so would exemption that pertains to civil construction, retrospective effect of exemption is applicable to electrical works executed and maintenance undertaken by the appellant. He also referred to the decision of the Supreme Court in the case of Commissioner of Customs and Central Excise, Vadodara- I v. Jyoti Ltd. [2022] 141 taxman.com 437 (SC). 9. Ld. Counsel further submits that the service tax prior to 01.06.2007 are exempted in view of the decision of the Supreme Court in the case of Commissioner, Central Excise & Customs, Kerala Vs. Larsen & Toubro Ltd. (2015) (SC), wherein, it was held that a works contract is a separate species of contract distinct from contracts from services simplicitor recognized by the world of Commerce and law as such and has to be taxed separately as such. It was further observed by the Hon'ble Apex Court that the Assessee's argument that there is no charge of tax of works contracts in the Finance Act, 1994 is correct. Therefore, while introducing the concept of service tax on indivisible works contracts in 2007 various exclusions are also made such as works contracts in r....
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....annu Property Dealers reported in 2011 (24) STR 173 ( P& H). Ld. Counsel further submits that it is a fit case for invocation of Section 80 of the Finance Act for dropping the penalties as the appellant had bona fide belief that they have provided the services to the government of India through CPWD and airport and it is not liable to service tax. 12. On the other hand, Ld. AR reiterated the findings of the impugned order and submitted that the appellant did not disclose all the facts to the department which was detected during the course of audit and therefore, the appellant has suppressed the facts with intend to evade the service tax and therefore the department has rightly invoked the extended period of limitation. 13. We have considered the submissions of both the parties and perused the material on record as well as the decisions relied upon by both the sides. 14. First of all, we will deal with the invocation of extended period of limitation because as per the Ld. Counsel for the appellant entire demand is barred by limitation as the demand has been raised only on the basis of audit objections without any further investigation by the department and without satisfying the ....
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....the correct information was not disclosed deliberately to escape from payment of duty. Where facts are known to both the parties the omission by one to do what he might have done and not that he must have done, does not render it suppression." (emphasis supplied) * It is, therefore, clear that the suppression of facts should be deliberate and in taxation laws it can have only one meaning, namely that the correct information was not disclosed deliberately to escape payment of duty. * This decision of the Supreme Court in Pushpam Pharmaceuticals was followed by the Supreme Court in Anand Nishikawa Co. Ltd. vs. Commissioner of Central Excise, Meerut7 and the relevant paragraph is as follows:- "27. Relying on the aforesaid observations of this Court in the case of Pushpam Pharmaceuticals Co. v. CCE we find that "suppression of facts" can have only one meaning that the correct information was not disclosed deliberately to evade payment of duty. When facts were known to both the parties, the omission by one to do what he might have done and not that he must have done, would not render it suppression. It is settled law that mere failure to declare does not amount to wilful suppres....
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....llant as fit for the applicability of the proviso." (emphasis supplied) * The Supreme Court in Continental Foundation Joint Venture vs. Commissioner of Central Excise, Chandigarh10 also observedin connection with section 11A of the Central Excise Act, that suppression means failure to disclose full information with intention to evade payment of duty and the observations are as follows:- "10. The expression "suppression" has been used in the proviso to Section 11A of the Act accompanied by very strong words as "fraud' or "collusion" and, therefore, has to be construed strictly. Mere omission to give correct information is not suppression of facts unless it was deliberate to stop the payment of duty. Suppression means failure to disclose full information with the intent to evade payment of duty. When the facts are known to both the parties, omission by one party to do what he might have done would not render it suppression. When the Revenue invokes the extended period of limitation under Section 11A the burden is cast upon it to prove suppression of fact. An incorrect statement cannot be equated with a wilful misstatement. The latter implies making of an incorrect statement with ....
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....ice tax under the category of Erection, Commissioning or Installation service with effect 16.05.2005 as alleged by the department, whereas, the claim of the appellant is that the services provided by them to CPWD and Airport authority are in the nature of works contract as per their agreement and are exempted from payment of service tax. Besides this, the appellant's stand is also that prior to 01.06.2007, service tax on works contract was not leviable to service tax as per the decision of the Hon'ble Apex Court in the case of Commissioner, Central Excise & Customs, Kerala Vs. Larsen & Toubro Ltd. cited (Supra), in this regard we find that the demand of service tax in respect of service rendered to airport is exempted from levy of service tax by virtue of definition of works contract under Section 65 (105) (zzzza) of chapter V of Finance Act, 1994 which is reproduced here in below: "Taxable Service" means any service provided or to be provided to any person, by any other person in relation to the execution of a works contract, excluding works contract in respect of roads, airports, railways, transport terminals, bridges, tunnels, and dams. Explanation. For the purposes of this su....