TaxTMI 
TaxTMI 
2024 (6) TMI 1110
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....ellants are before this Tribunal. 3. Shri G. Shiva Kumar, learned counsel appeared for the appellant and Shri Anoop Singh, learned Joint Commissioner (AR) appeared for the respondent. 4. The learned counsel for the appellant submitted that the dispute is whether works contract for construction for educational institution is taxable under Works Contract Service? The main crux is whether the building's constructed for the said educational institutions can be regarded as 'intended for commerce or industry'. The OIO states that so long as they (Education institution) collect fees they are commercial. He stated that educational institutions are meant for education and just because some amount is collected they will not cease to be non-profit and become commercial in nature. He placed reliance on the following judgments in this regard. a. MCSARA Constructions Vs. The Commissioner of Central Excise, Velammal Education Trust - 2021 (3) TMI 1026 - Madras High Court b. H. Kannan, Prop. Of Unikans Vs. CCE, Madurai & Vice Versa - 2018 (5) TMI 837 - CESTAT Chennai c. M/s. SRM Engineering Construction Ltd. Vs. Commissioner of Service Tax, Chennai - II - 2018 (2) TMI 321 - CESTAT Chennai ....
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....d both sides. Classification of services is a matter relating to chargeability and the burden of proof is squarely upon the Revenue. If the Department intends to classify a service under a particular category, the Department must adduce proper evidence and discharge the burden of proof. The judgments of the Hon'ble Supreme Court in Union of India v. Garware Nylons Ltd. [1996 10 SCC 413]; H.P.L Chemicals vs. Commissioner of Central Excise, [2006 (197) E.L.T. 324 (S.C.)]; Puma Ayruvedic Herbal (P) Ltd. v. Commissioner of C. Ex., Nagpur [2006 (196) E.L.T. 3 (S.C.)], although rendered in the case of classification under the Central Excise Act is also relevant for classification of a service under the FA 1994. 7. The present issue relates to the activity undertaken by the appellant under Works Contract Service (WCS) as alleged by Revenue. The service was introduced and leviable to Service Tax with effect from 01/06/2007. Section 65(105)(zzzza) of the FA 1994, pertaining to WCS, is reproduced below; 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....
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....hing) cannot be taken to understand the term 'commerce or industry' used for another service (WCS) when no ambiguity is involved. As a general principle of interpretation, where the words of a statutory provision are plain, and unambiguous, the intention of the Legislature is to be gathered from the language of the provision itself. The term 'commerce or industry' are commonly understood terms and do not require the aid of another definition from the statute to gather its intention. Commercial activities, relate to activities having profit as the primary aim. The Hon'ble High Court of Kerala in its judgment in Social Service Guild of Assissi Sisters v. K.S.E.B. [(1988)1 Ker LT 727 (733)] held as under; 14. "Commercial" in ordinary parlance, means "engaged in commerce" and "commercialize" in Webster's Third New International Dictionary means:- "to engage in conduct, practice, or make use of for profit-seeking purposes as distinguished from participation, practice, or use for spiritual or recreational purposes or for other non-pecuniary satisfactions". (emphasis added) 10. Education institutions whether in the private sector or run by Government, other than purely charitable i....
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.... appellant 'suppressed the vital fact of rendering Works Contact services to the abovementioned educational institutions from the knowledge of the department and not paid appropriate Service Tax without bringing out any negative intention of willful default. Normal audit objection based on legal reasoning does not lead to a charge of suppression. Something more is required. In any case the demand having failed on merits the issue of any demand, interest and penalty does not arise. 12. As for the judgments cited by Revenue, it is to be stated that the judgments in M/s. R.K. Enterprises pertains to 'commercial or industrial construction service' vs 'works contract service' and there is no discussion on the phrase 'primarily for the purposes of commerce or industry'. Similarly M/s G. Ramamoorthy (supra) decided by the Hon'ble Madaras High Court leaves open and remands the issue whether the construction provided by the petitioner to the education institutions were meant to be used for academic purposes or for commercial purposes. The judgment of the Tribunal in Harsh Constructions Pvt Ltd (supra) goes against Revenue in as much as at para 5.2 it is held that prima facie the constructi....