TaxTMI 
TaxTMI 
2024 (12) TMI 1240
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....cordingly a show cause notice dated 17.03.2017 came to be issued demanding a service tax of Rs.1,95,11,336/- under section 73 (1) of the Finance Act, 1994. The penal provisions under section 76 and 77 of Finance Act, 1994 has also been invoked. The show cause notice has also invoked provisions of section 75 of the Finance Act, 1994 for charging internet on the service tax demand. The learned additional commissioner vide impugned order-in-original has confirmed all the charges as invoked in the show cause notice. 3. The appellant has approached Commissioner (Appeals) who vide his Order-in-Appeal dated 12.07.2018 have allowed the appeal of the respondent assessee and set aside the findings of the impugned order-inoriginal. The revenue is an appeal before us against impugned Order-in-Appeal dated 12.07.2018 on following grounds:- "12. The Commissioner (Appeals) has also erred in not appreciating the fact that the adjudicating authority has considered the contention of the assessee as regards the services rendered being covered under exemption notification 25/2012-ST dated 20.06.2012. It has been concluded by adjudicating authority that exemption from service tax is applicable only....
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....ll cover under Sl.no. 12(e) and 25(a) of the mega exemption notification. Also other structural work performed by the appellant to the SMC covered under the said notification. Hence, the said services provided by the appellant to the SMC, are exempt from the service tax. The adjudicating authority has misinterpreted the issue by finding that the said services are used for commercial purpose whereas the SMC has performed his statutory duty, by way of providing the system of transmission of fluid for public. Therefore, the said services are exempt from service tax. 5.8 Further, I rely upon the decision of Hon'ble High Court of Gujarat in the case of the Commissioner of CGST and Central Excise, Surat vs M/s. BMS Projects Pvt. Ltd. Vide order dated 21 September 2017[2017(9) TMI 1386- Gujarat High ourt] 1) wherein it was held that "service provided by the respondent in laying down long distance pipeline for transfer of drinking water in the state of Gujarat pursuant to a contract awarded by Gujarat Water Supply and Sewerage Board-levy of tax- Held that- GWSSB discharged an important duty and responsibility of providing drinking water to the people, industries etc. The Board was c....
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....ant to a contract awarded by Gujarat Water Supply and Sewerage Board-levy of tax- Held that- GWSSB discharged an important duty and responsibility of providing drinking water to the people, industries etc. The Board was constituted mainly to supply drinking water and maintenance of Sewerage System. The usage charges recovered by the Board from Gram Panchayat, Nagar Palika and Nagar Panchayat are at highly subsidized rate and therefore, cannot be considered as an industry in the sense that the said word is used in the definition of taxable entry. The Board was sustaining on the grants released by the State Government. The pipelines constructed were for providing drinking water facilities to the people of the State through different Gram and Taluka Panchayats. Only a small portion of the water was provided to the industry at commercial rateslevy of tax set aside" In view of the above decision of the Gujarat High Court and as well as by perusal of the mega Notification No. 25/2012 dated 20.06.2012. We have no doubt that the activity undertaken by the respondent assessee falls under the category of exempted services. 4.2 We also take note of the fact that for earlier period in as....
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....the decision of REAL VALUE PROMOTERS PVT. LTD. (supra) and on the decision in the case of CONCEPT MOTORS PVT. LTD. (supra). In the case of CONCEPT MOTORS PVT. LTD. (supra) tribunal has observed as follows: "As regard the demand of service tax on referral fees received by the appellant from HDFC Chubb insurance company, we find that the service is in connection with business of insurance of HDFC Chubb. In terms of Sub Section 65 of Finance Act, 1994, the service provided by the appellant falls under definition of Insurance Auxiliary Services whereas the Revenue has raised the demand under wrong head. On this ground the demand of service tax under Business Auxiliary Services does not sustain. As per our above discussion, the impugned order is set aside and appeal is allowed." 5.1 The next argument of the appellant is that the service provided by them is not covered under ECIS as held by tribunal in case of INDIAN HUME PIPE CO. LTD. (supra) affirmed by the Hon'ble High Court of Madras. In Para 8, 8.1 & 8.2 of the decision of tribunal in case of INDIAN HUME PIPE CO. LTD. following has been observed: "8. We have considered the rival arguments. The dispute involves the meani....
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....4, from 16-6-05 onwards meaning of 'erection, commissioning or installation' (Section 65(39a)) was enlarged to include installation of various devices and equipments. An entry "plumbing, drain laying, or other installation for transport of fluids" was introduced under sub-section (ii)(b). The Impugned order found that the service involved was specifically covered from 16-6-05 under the same head by the entry "plumbing, drain laying, or other installation for transport of fluids". We are inclined to agree with the appellants that this entry covers such facility provided in a building as it appears in the company of airconditioning system, lifts, electronic devices including wiring etc. which are installed in a building. The Commissioner found that "plant represented a fixed investment for carrying out certain institutional activity for business". The Id. Consultant for the department has tried to defend the interpretation of the Commissioner of the expression plant. The Commissioner's interpretation of a plant would cover a long distance pipeline. We find it difficult to accept the above reading of the word plant in the context it is used. It is an inappropriate selectio....
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....m the scope of the taxable services qua the exclusionary clause definition of CICS, in Section 65(25b) of the Act." 11. As rightly pointed out by the Tribunal, the assessee was entrusted with the task of laying a long distance pipeline to enable the Tamil Nadu Water Supply and Drainage Board to supply water. It was an activity in public interest, to take care of the civic amenities liable to be provided by the State. Therefore, the Tribunal was right in holding in favour of the assessee. Hence, the question of law is answered in favour of the assessee." 5.3 In view of categorical findings of Larger Bench as well as Hon'ble High Court of Madras cited above we respectfully hold that the activities under taken by the appellant cannot be classified under ECIS. 5.4. The other arguments of revenue regarding classification of services under Works Contract Service or Commercial or Industrial Construction Service become irrelevant as no demand under the said head has been raised by revenue. No charge for classification of the serviced provided by the appellant under the head of Works Contract or Commercial or Industrial Construction Service has been made against the appellant. ....