AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2025 (9) TMI 813
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.... a small portion for other Government Undertakings. The impugned demand in the present appeal is related to contracts which were awarded by M/s. Power Grid Corporation of India Limited (PGCIL) and M/s. RITES Limited (RITES) in respect of civil construction work rendered by the appellant. 1.2. The appellant states that PGCIL is a Public Sector Enterprise and a national electric power transmission utility. PGCIL had awarded various contracts during the material period for providing site levelling services including one contract for construction and repairing of existing approach road which is for general public use at large. Further, RITES had given one contract (on sub-contract basis) for construction of formation of Railway Embankment and Construction of Bridge in respect of Railway line / link from Salakati Railway Station to Bongaigaon Thermal Power Project. 1.3. A Show Cause Notice dated 17.04.2015 was issued to the appellant demanding Service Tax 1,63,79,265/- (including Education Cess and Secondary and Higher Education Cess) for the period from October, 2009 to September, 2014. In the Show Cause Notice, it has been alleged that during the aforesaid period, the appellant ....
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....Notification No 32/2010-ST, dated 22.06.2010 service tax in relation to distribution of electricity has been exempted w.e.f. 22.06.2010. It is submitted that Notification No 11/2010-ST (supra) and 32/2010-ST (supra) got rescinded by Notification No 34/2012-ST dated 20.06.2012 w.e.f. 01.07.2012. Further, it is stated by the appellant that w.e.f. 01.07.2012, Section 66D(k) of the Finance Act, 1994 specifies Transmission or Distribution of electricity by an electricity transmission or distribution utility in the negative list on which no service tax is leviable. Thus, the appellant submits that the demand of Service Tax of Rs.44,22,505/- confirmed in the impugned order under the category of 'site formation' is not sustainable. 4.1. Regarding the demand of Service Tax amounting to Rs.76,41,490/- confirmed in the impugned order on this count, the appellant submits that immediately after obtaining legal opinion that services rendered to PGCIL in connection with site levelling and civil construction has become taxable w.e.f. 01.07.2012, the appellant suo motu quantified the service tax liability for the period from 01.07.2012 to 31.08.2014 in respect of services provided to PGCIL and i....
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....count is not sustainable. 6. Regarding the demand of Service Tax confirmed in the impugned order on works pertaining to Railways amounting to Rs.35,30,050/-, it is the appellant's submission that construction, erection, commissioning or installation or original works pertaining to railways has been exempted from payment of service tax by virtue of Notification No 25/2012 (supra) w.e.f. 01.07.2012; they submit that prior to 01.07.2012, the same has been excluded from the definition of works contract service as per Section 65(105)(zzzza) of the Finance Act, 1994. The appellant have stated that they never collected and discharged Service Tax on the contract / work undertaken in this regard under LOA No. 12/P/NTPCBg.TPP/Civil-PKG-II/Vol-II/2010/3062 awarded by RITES vide Contract dated 23.06.2010, since prior to 01.07.2012 services in respect of Railways have been excluded from the definition of works contract and the same has been exempted from payment of service tax w.e.f. 01.07.2012 by virtue of Sl. No 14(a) of the Notification No. 25/2012 (supra). In view of these submissions, the appellant argues that the demand confirmed on this score is also not sustainable. 7. The Ld. Aut....
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....r the benefit of exemption under Notification No. 11/2010 (supra) and Notification No. 45/2010 (supra). A similar matter has also been decided by the Tribunal in the matter of M/s Kedar Constructions Versus Commissioner of Central Excise, Kolhapur, reported in 2014 (11) TMI 336 - CESTAT MUMBAI. The decision in M/s. Kedar Constructions (supra) has also been followed in the following cases:- (i) Vraj Construction versus Commissioner of C.E. & S.T. -Surat-I [2024 (9) TMI 406 - CESTAT AHMEDABAD]; (ii) KEC International Ltd. versus Commissioner Of CGST, Gurgaon and Commissioner of S.T., Delhi [2022 (8) TMI 992 - CESTAT, CHANDIGARH]; (iii) M/S. Tamilnadu Electricity Board versus Commissioner of GST and Central Excise, Salem, [2023 (11) TMI 14 - CESTAT CHENNAI]. 10.3. In the impugned order, it has been recorded that there is no direct nexus between the scope of work and transmission / distribution of electricity. Further, it has also been observed in the impugned order that the work done was not for setting up of transformers, converters, switch gears, capacitors, condensers, structure cable and other appurtenant equipment or any building for the transmission....
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....nt in the case of Kedar Construction (supra) is squarely applicable to the facts and circumstances of this case. Accordingly, we hold that the appellant is eligible for exemption provided under the above said notifications. 10.6. We further observe that Notification No. 11/2010 was rescinded w.e.f. 01.07.2012 by Notification No. 34/2012 dated 20.06.2012 and exemption was restricted only to transmission of electricity by an electricity transmission or distribution utility and not to other contractors by virtue of Section 66D(k) of the Finance Act, 1994. In this regard, we find that as and when the appellant became aware that the exemption under Notification No 11/2010 (supra) was no longer available, they immediately suo motu calculated the Service Tax liability on the services provided to PGCIL and deposited the Service Tax liability, along with interest and intimated the same to the Department. Thus, in these facts and circumstances, we are of the view that there was no need to issue Show Cause Notice for this demand. As the demand of Service Tax of Rs. 57,43,279/- along with applicable interest of Rs. 13,09,260/-, has been paid before issue of the notice, we hold that no penal....
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....vice Tax is payable on the construction of formation of railway embankment and construction of bridges under this work order dated 23.06.2010. 12.2. In the impugned order, we find that the Ld. Commissioner has cited the definition of the term 'railway' as per Section 2(31) of the Railways Act, 1989 and has observed that 'railways' can be of two types viz. 'Government railway' and 'non-Government railway' and for both of them to qualify as 'railway' it must be used for public carriage of passenger of goods. We do not agree with the said reasoning given by the Ld. Adjudicating authority in the impugned order. The definition of 'Railway' in the Railway Act, 1989 does not distinguish between 'Government railway' and 'non-Government railway'. For sake of clarity, the definition of the term 'railway' under the said Act is reproduced below: - "(31) "railway" means a railway, or any portion of a railway, for the public carriage of passengers or goods, and includes- a. all lands within the fences or other boundary marks indicating the limits of the land appurtenant to a railway; b. all lines of rails, sidings, or yards, or branches used for the purposes of, or ....
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....in the decision in Afcons Infrastructure Ltd. (supra), it has been held by the Tribunal that there is no distinction between a monorail and metro rail or any other kind of rail and therefore the term 'railways' used therein has to be given its widest meaning to include all types of railways and all types of railway lines. Rather, it may be observed that the definition of "railway" reproduced above does not specifically exclude 'private railway' from its purview. Therefore, we find the observation of the Ld. Commissioner on this count to be based on incorrect appreciation of the judgment in the case of Afcons Infrastructure (supra) and hence deserves to be set aside. 12.6. In this context, we refer to the decision of this Tribunal in the matter of M/s. K.V. Mohana Rao & Company Private Limited, reported in 2024 (11) TMI 401, wherein exemption under Notification No. 25/2012 has been allowed for construction service provided to private entities also. Relevant extract of the decision of reproduced below - "30.7.1 ................... We observe that this demand has been confirmed in the impugned order on the ground that the services rendered by the appellant are related to p....