TaxTMI 
TaxTMI 
2025 (6) TMI 1881
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....lly for fixed period which are in the nature of cleaning/housekeeping, electrical maintenance and civil maintenance works to various township buildings, plant areas and auxiliary buildings, township water supply maintenance works which involve repair, renovation, extension, demolishing and reconstructions, sanitary, painting/white washing works, etc., to the existing buildings and also pipe line repair and maintenance of water supply works in NTPC township. The appellants had classified all housekeeping and cleaning works under 'Cleaning services'; all Annual Electrical maintenance works under 'Maintenance or Repair services'; Annual Civil maintenance works under 'Commercial Construction services' since 2005-06 and were discharging the liability of service tax accordingly. However, in respect of works executed under Commercial Construction services, service tax was paid on 33% of the value after availing abatement of 67% in terms of Notification 15/2004-ST dt.10.09.2004 and 01/2006-ST dt.01.03.2006. 3. Audit was conducted by the department for the period July, 2003 to March, 2006 and the following observations were made: a) The benefit of abatement under Notification No....
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....Repair Service' (MMRS) but not under 'Commercial or Industrial Construction service' (CICS), as claimed by the appellant and accordingly, appellant was not entitled for abatement of 67%. b) On the issue of irregular availment of abatement under Notification No. 15/2004-ST and 01/2006-ST without including the value of material supplied free of cost by M/s NTPC, in view of Rule 3 of Service Tax (Determination of Value) Rules, 2006, subject to section 67, and in terms of decision of Coordinate Bench at Bangalore in the case of VPR Mining Infrastructure Pvt Ltd [2011 (23) STR 279 (Tri- Bang)], it was held that value of materials supplied free of cost has to be included in the gross value for the purpose of availing benefit under above notifications and for the purpose of payment of service tax by the appellant. c) On the issue of short payment of service tax in respect of LOAs No. 190 & 206, the appellant was directed to discharge service tax of Rs.3,14,756/- after appropriating the service tax of Rs.9,39,213/- already paid. d) On the issue of non-payment of service tax in respect of LOAs No. 151 & 156, the services were held to be classifiable under 'Cleanin....
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....d auxiliary buildings and various township buildings of NTPC, which involved works like repair, alteration, renovation, maintenance, painting, colour/white washing, sanitary and pipeline repair/ maintenance and replacement works, construction of sheds, compound wall, extension of community centre buildings, etc. The agreements basically did not involve any construction activity and are only in relation to maintenance of existing facilities so as to keep them in working/usable condition so as to not to cause any hardship to NTPC. 10. Section 65(25b) of the Finance Act, 1994 provides the definition of 'Commercial or Industrial Construction Service' as thus:- "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, painting, floor and wall tiling, wall covering and wall papering, wood and metal joinery and carpentry, fencing and railing, construction of swimming pools, acoustic applications or fittings and other similar services, in relation to building or civil structu....
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....37, 239, 261, 313, 314, 341 and 349 observed that the LOAs consist of three parts. Part-I relates to works viz., Carriage of materials, Earth work, Concrete work, Reinforced cement concrete work, Brick work, Stone work, Wood work, Steel work, Flooring work, Roofing work, Finishing work, Repairs to building work, Dismantling & Demolishing work, Misc building work, Road work, Sanitary installation work, Water supply work, Drainage work, Aluminum work, Water proofing work and miscellaneous works, etc. Part-II relates to works viz., Annual civil maintenance contract for all buildings other than plant area, AMC for all buildings & structures inside plant MGR & ADMN buildings and AMC for all buildings in plant area, etc. Part-III relates to works viz., Acid proof works in main plant area and Acid proof works in offsite area etc. The LOAs also contain the time schedule for attending to various civil complaints in plant area, special conditions of contract for civil maintenance works in plant area, list of minimum equipment and machinery required for the execution of work and technical specifications for acid/alkali resistant lining. The subject of the LOAs is mentioned as Annual Maintenan....
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....'. Therefore, the services as mentioned in the above LOAs i.e., repair or maintenance of buildings are rendered under an annual/biennial agreements. The same are required to be classified under Management, Maintenance or Repair service and not under Construction service. 15. Learned Counsel for the appellant relied on the judgment of Coordinate Bench at Bangalore in the case of Spandrel Vs CCE, Hyderabad/Kochi [2010 (20) STR 129 (Tri-Bang)], in which the Tribunal quoted Circular No. F.No.B1/6/2005-TRU dt.27.07.2005 and clarified as follows: "14.2 Post construction completion and finishing services such as glazing, plastering, painting, floor and wall tiling, wall covering and wall papering, wood and metal joinery and carpentry, especially if undertaken as an isolated or stand alone contract, are also specifically included. Thus post construction completion and finishing services are specifically included in the definition of commercial or industrial construction services." But in the instant case, there is no such isolated or standalone contract. Therefore this case law is distinguished. 16. As discussed above, the Commissioner has rightly classified the above ser....
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....h consideration. 19. The Adjudicating Authority, in the OIO, decided that the value of the material supplied free of cost by M/s NTPC should be included for the purpose of availing abatement. 20. The Larger Bench of this Tribunal in the case of Bhayana Builders (P) Ltd Vs CST, Delhi [2013 (32) STR 49 (Tri-LB)], concluded their answer as under:- "16. In conclusion we answer the reference as follows: (a) The value of goods and materials supplied free of cost by a service recipient to the provider of the taxable construction service, being neither monetary or non-monetary consideration paid by or flowing from the service recipient, accruing to the benefit of service provider, would be outside the taxable value or the gross amount charged, within the meaning of the later expression in Section 67 of the Finance Act, 1994; and (b) Value of free supplies by service recipient do not comprise the gross amount charged under Notification No. 15/2004-S.T., including the Explanation thereto as introduced by Notification No. 4/2005-S.T." This judgment is upheld by Hon'ble Supreme Court reported at [2018 (10) GSTL 118 (SC)]. 21. Therefore, now it is settled ....
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.... of service tax paid by some contractors. 25. The Adjudicating Authority found that even though the payment of service tax has been made by the sub-contractors during the month of January, 2009 to April, 2009, credit has been availed by the appellant only during 2010. The service tax credit available as on the last date of month of January, 2009 and April, 2009 are only to be utilized for payment of service tax on the amounts received during the respective months. Even if there is clerical oversight, the appellant has the availability for payment of tax dues arising after the said date of availment and cannot be utilized for payment of service tax for the earlier period. In this regard, proviso to Rule 3(4) of Cenvat Credit Rules, 2004, is important to mention, wherein, it was provided as follows: "Provided that while paying duty of excise or service tax, as the case may be, the CENVAT credit shall be utilized only to the extent such credit is available on the last day of the month or quarter, as the case may be, for payment of duty or tax relating to that month or the quarter, as the case may be." 26. The case law relied upon by learned Counsel on M/s Origin Learnin....
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....in the factory premises from one place to another and accordingly, is not taxable. E. Invocation of extended period and imposition of penalty : 30. Learned Advocate submitted that from the above submissions, it can be observed that appellant has relied on various judgments either from the Coordinate Benches of this Tribunal or Hon'ble High Courts and Supreme Court in arriving at the categorization of services or in utilizing Cenvat credit or in certain cases of clerical errors, which resulted in credit not being reported in the ST3 returns. In several cases, decisions with regards to the matters have reached conclusion belatedly and have had several instances of varying approaches. The appellant had started paying service tax in consideration of the service being CICS even prior to the introduction of the category proposed by the impugned order came into force. They had also disclosed the information to the Department and had also at all times co- operated in completing the audit requirements. He also submitted that all the acts of the appellant have always been in the bonafide belief and never with an aim to evade tax. He has relied on the judgment of Hon'ble Supreme Court i....