AI Drafter 
TaxTMI 
TaxTMI 
2024 (6) TMI 1039
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.... contract service category with an intention to evade service tax by wrong availment of Cenvat credit and short payment of Service tax at the concessional rate of 4.12%. As per revenue the correct classification of service provided by the Appellant falls under construction of Residential Complex. Since the Cenvat Credit of Service tax paid by the sub-contractor was not available under category of Construction Service, the appellant had misclassified their service under 'Works Contract Service category with intention to avail Cenvat credit wrongly and evade service tax. Since the Appellant had paid service tax through inadmissible Cenvat Credit, they were liable to pay from the cash account. Further department observed that for the services provided by the appellant during the period of its commencement to 30.06.2012, abatement of 75% has been provided under Notification No. 01/2006-ST dated 01.03.2006 as amended vide Notification No. 29/2010-ST dated 22.06.2010 (Sr. No. 7a and 10a). The abatement of 75% is subject to the condition that value of land is not separately recovered from the buyer by the builder i.e value of land is included in the amount charged from the service receive....
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....g 198 flats and 23 shops. Appellant has utilized CENVAT credit facility on input services used in relation to execution of works contract. Appellant has not availed any CENVAT credit on Capital goods. Appellant is paying Service Tax on construction activities under the Works Contract Service and availing the CENVAT credit of Service tax paid on Input Services. Department's allegation is that appellant's activities are falling under the service of Commercial or Industrial Construction and partly under Construction of Complex Services and thus CENVAT credit of Service tax paid on Input Services shall not be available to the Appellant. The Appellant outsourced the construction work to the sub-contractor who were also registered under the works contract services. Appellant developed the land for developer as per the development agreement. The sub-contractor carried out the work of construction activity. The Appellant claimed the CENVAT credit of Service tax paid to sub-contractor as the appellant was falling under the category of works contract service. The Appellant was paying the Service tax on construction activities under the works contract services and were also availing the CENVA....
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....tax of Rs. 3,18,000/- in relation to the undisclosed income declared during the course of survey under Section 133A of the Income Tax Act. After disclosure to the said income appellant paid the due service tax from Cenvat account, the department did not allow the appellant to make the payment of the same by way of CENVAT Credit and thus demanded the same in cash or current account. However only on the basis of income disclosure to the income tax department, no service tax can be demand. Further, department alleged that the appellant is providing the taxable service which are falling under the category of 'construction of commercial or industrial construction' and partly under the 'Construction of Complex Service' thus the appellant is not entitled to the CENVAT credit on the input services and this the appellant is required to discharge the said liability of service tax by way of cash or current account. However, the activities performed by the appellant are clearly covered under the definition of works contract services. Thus considering the same the appellant is entitled to utilized the Cenvat Credit for making the payment of the service tax amounting to Rs. 6,18,000/- on account....
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....gross amount charged for service, the services of CICS and CCS would cover only pure service activities, as any contrary view would imply that the Union Government can levy service tax on the gross amount, including the value of transfer of property in goods also, which is constitutionally impermissible. The exemption notifications issued at the discretion of the executive are not sufficient to sustain the levy. The Hon'ble Apex Court has also observed that only with the introduction of WCS as a separate taxable service, statutory mechanism to exclude the value of transfer of property in goods has been prescribed. 3.6 The effect of the above decision is that CICS and CCS, as defined under clauses (zzq) and (zzzh), respectively, of sub-section (105) of the section 65 would cover only pure service contracts, without any transfer of property in goods. 3.7 In various decisions the importance of classification of services has been laid down and it has been held that once the show cause notice proposes demand of servicetax under a particular category of taxable service, the adjudicating/appellate authorities cannot travel beyond the scope of allegations in the show caus....
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.... (a) The services provided by the appellant in respect of the projects executed by them for the period prior to 1-6-2007 being in the nature of composite works contract cannot be brought within the fold of commercial or industrial construction service or construction of complex service in the light of the Hon'ble Supreme Court judgment in Larsen & Toubro (supra) upto 1-6-2007 (b) For the period after 1-6-2007, service tax liability under category of 'commercial or industrial construction service' under Section 65 (105) (zzzh) ibid, 'Construction of Complex Service' under Section 65(105)(zzzq) will continue to be attracted only if the activities are in the nature of services' simpliciter. (c) For activities of construction of new building or civil structure or new residential complex etc. involving indivisible composite contract, such services will require to be eligible to service tax liabilities under 'Works Contract Service' as defined under section 65 (105) (zzzza) ibid. (d) The show cause notices in all these cases prior to 1-6-2007 and subsequent to that date for the periods in dispute, proposing service tax liability on the impugned service....