TaxTMI 
TaxTMI 
TaxTMI 
2025 (10) TMI 613
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.... 3. The Department filed appeal before the Commissioner (Appeals) who allowed the appeal filed by the Department and passed the following order:- "6.7 As a result, I confirm the demand of service tax of Rs.46,99,844/-under proviso to Section 73(1) of the Finance Act, 1994 read with Section 142 and 174 of CGST Act, 2017 along with interest under Section 75 of the Finance Act, 1994 read with Section 142, 173 & 174 of CGST Act, 2017 and I impose penalty under Section 78 of the Finance Act, 1994 read with Section 142, 173 & 174 of CGST Act, 2017. 6.8 In the light of discussions made in the foregoing paras, the impugned order is modified as above and the appeal is allowed." 4. The Revenue has challenged the order of the Assistant Commissioner on the ground that the Appellant as sub-contractor has to discharge his service tax liability on taxable services rendered by him. The learned Commissioner (Appeals) has held that Adjudicating Authority has erred in dropping the demand of Rs. 46,99,844/- on the taxable value of Rs. 3,13,32,293/- and he thus confirmed the demand. Vide the impugned Order-In-Appeal learned Commissioner (Appeals) has observed as under:- ....
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.... law it is noted that no documentary evidence or finding has been made by the Adjudicating Authority to establish that an agreement was there in relation to shifting of service tax liability. Secondly, the Respondent had acted as a sub-contractor to UPRNN and only provision exempting liability of service tax on services of sub-contractor provided by way of works contract to another contractor providing works contract services which are exempt has been provided under clause (h) of entry no. 29 of the Notification No. 25/2012-Service Tax dated 20th June 2012. However, in the case of the Respondent the services of UPRNN were taxable hence, the benefit of the said clause cannot be extended to them. 6.5 Further, neither any counter-argument nor any finding of the adjudicating authority has been made in the impugned order in relation to the contention of the Appellant that the payment certificate issued by UPRNN is for two years i.e. 2015-16 and 2016-17 and challan amount deposited by UPRNN is of much higher amount than for which show cause notice has been issued thus, no direct co-relation with the amount for which show cause notice has been issued can be established. ....
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....his claim. (i) Commissioner of Central Excise, VAPI Vs. Kolety Gum Industries 2016 (335) ELT 581 (SC). (ii) Assistant Commissioner of GST & Central Excise, Chennai Vs. Shriram Value Services Pvt. Ltd., 2019 (368) ELT 928 (Mad.) (ii) Synergy Engineers Group Pvt. Ltd. Vs. Principal Commissioner, Customs, Central Excise and Service Tax, Bhopal (2023) 5 Centax 158 (Tri.-Del). 9. Learned Departmental Representative has justified the impugned order and prayed that the appeal filed by the Appellant being devoid of any merits be dismissed. 10. Heard both the sides and perused the appeal records. 11. I find that the Original Authority has passed the following order:- "I have carefully gone through the records of the case as well as contents of the Show Cause Notice with material and evidences relied upon for its proposition and facts available in the file. On examination of documents, I find that that the party is engaged in water proofing work under work contract alongwith supply of material such as 'Morang bricks and stone' during financial year 2016-17. The party has been awarded work contract by M/s UP Rajkiya Nirman Nigam Ltd. for wa....
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....ed by the Project Manager of M/s UPRNN Lucknow regarding payment of service tax. On examination of letters/certificate provided by the party as mentioned above, I find that the UPRNN is main contractor and liable to pay the service tax on entire work i.e. construction of building and water proofing work. Water proofing work is only a part of the construction of building. Hence, UPRNN has deposited the service tax on entire consolidated work ie, construction of building including water proofing work and issued the certificate to this effect. In support, party has also provided the copies of challans which support the claim for payment of service tax by UPRNN details of which are as under: - Accordingly, I am of the view that UPRNN has deposited consolidated service tax. The party has also produced copies of the work orders issued by different units of M/s UPRNN Ltd. located at Firozabad, Jhansi, Kanpur, Raibareli and Lucknow etc. during the relevant period allotting them 'water proofing work' and also submitted the copies of the certificates issued by M/s UPRNN Ltd. units located at Firozabad, Jhansi, Kanpur, Raibareli and Lucknow certifying that the party ....
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.... that the same has not been produced. In view of this position, we are of the considered opinion that the matter is required to be remanded for de novo consideration on limited issues. The appellants shall be given an opportunity to establish that the main consultant has already discharged the service tax." In another case, the Hon'ble Tribunal, Bangalore in the case of M/s Synergy Audio Visual Workshop Vs The Commissioner of Service Tax vide order dated 31.01.2008 has held that - *5. We have carefully considered the submissions and gone through the records. It is seen from the impugned order that the assessee had relied on the instructions given in Circular dated 31.10.1996 on the ground that they are not liable to pay Service Tax on the amounts received from the main advertising agency. This clear instruction clarifies that once the main advertising agency has paid the Service Tax, then the sub-contractor is not liable to pay the Service Tax. The Commissioner (A) has not followed this circular although the demands are on that ground. In terms of the allegations and grounds taken by the party, we find that this is a tenable ground. The appellants have not col....
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....ble. The issue is already settled by the Hon'ble Supreme Court in the case of Commissioner of Central Excise, VAPI Vs. Kolety Gum Industries 2016 (335) ELT 581 (SC). Relevant para of the judgment is reproduced below:- "2.******************** We need not go into the aforesaid issue inasmuch as the assessee would succeed on the ground of limitation itself because of the reason that the judgment of the Tribunal on the issue of limitation is perfectly justified inasmuch as at the relevant time there was conflicting judgment of the Tribunal and thus the action of the respondent in classifying the goods was clearly bona fide and larger period of limitation would not be available to the Department." 14. This ratio has been followed consistently by the Tribunal. In the case of Synergy Engineers Group Pvt. Ltd. V/s Principal Commissioner, Customs, Central Excise & Service Tax, Bhopal reported at (2023) 5 Centax 158 (Tri.-Del.) following has been held:- 8. The reasons given by the Larger Bench to hold that a sub-contractor would be liable to pay service tax even if the main contractor has discharged service tax liability would also be applicable in the case of a....