2025 (8) TMI 8

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...."completion and finishing service". 2. Briefly stated, the appellant is engaged in civil construction services and registered with the Service Tax Department. During the period in dispute from 2013-14 to 2015-16, the appellant was awarded a work order dated 10.10.2013 by the "Developer" in respect of a new project launched by the name "Sunshine City Project" for two towers named "Opal and Pearl Tower" at Bhiwadi. The appellant was responsible for carrying out a comprehensive range of construction services for newly built structures. These services include earthwork (cutting, fixing floor, skirting and dado work) as well as specialized tasks like waterproofing, carpentry and glasswork (including doors, windows and reception counters), plumb....

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....wever, the interest on the said amount was maintained. Challenging the order-in-original, the appellant filed an appeal, which has been rejected by the impugned order [Order-in-Appeal No.299(CRM)/ST/JPR/2019 dated 02/09.09.2019] on the observations that the appellant was awarded "Works Order" for completion and finishing work and, therefore, was required to pay the service tax on the gross amount of 70% of the amount charged by the appellant from the service receiver. Hence, the present appeal. 4. Heard Shri A.K. Batra, learned Counsel for the appellant and Shri Anand Narayan, Authorised Representative for the respondent and perused the records of the case. 5. Shri A.K. Batra, learned Counsel for the appellant while clarifying the nature ....

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....l Work" and, therefore, the assessee is liable to pay service tax on 40% of the amount charged. In the case of Kalpakaaru Projects Pvt. Ltd. (supra), the Bench noticed the extensive nature of work carried out by the appellant and held that the appellant converts a bare skeletal structure of a building into a complete show room including the electricity, HVAC plumbing, flooring, ceiling, air-conditioning, partitioning etc., which has to be considered as "Original Works" and cannot be called merely "finishing or completion work". The fact that they have to be considered as "Original Works", they will be covered by Rule 2A(ii)(A) of the Valuation Rules, 2006 and will be entitled to 60% abatement and service tax has to be paid only on 40% of th....

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....on and were completed by the appellant by carrying out the remaining activities. The term "construction" would involve multifarious activities. In other words, the concept of construction necessarily has an inbuilt part of finishing to make the building/tower/complex habitable and workable. In the context from the "Work load" mentioned in the "Work Orders" read with the letter issued by the Developers, there is no iota of doubt that the work sub-contracted to the appellant was part of the main contract, which is an original work. The "Work Contract Services" provided by the appellant would fall under the purview of the definition of "Original Works" under Explanation-I to Rule 2A of the Valuation Rules. The relevant provisions of the Rule 2....