TaxTMI 
TaxTMI 
TaxTMI 
2025 (11) TMI 1279
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....ce" to M/s GSPHCL during the period from 01.04.2007 to 31.05.2007, service tax of Rs. 1,62,95,451/- on works contract service for the period from 01.06.2007 to 31.03.2012 and Service Tax of Rs. 9,33,199/- under GTA service for the period 2007-08 to 2011-12 along with interest and penalty under Section 76, 77 and 78 of the Finance Act, 1994. 1.1 The said show cause notice was decided by the Commissioner wherein he confirmed the entire service tax liability is proposed in the Show Cause Notice along with interest and imposed penalty equal to service tax amount under Section 78 of the Finance Act, 1994 besides penalties under Section 76 & 77 of the said Act. Aggrieved with this order, the appellant filed the present appeal before this Tribunal. 2. In their appeal, the appellant has taken the following grounds:- * The appellant has constructed Type D, Type E and Type E1 residential quarters and therefore it is out of the purview of Clause-I of definition of Residential Complex. Therefore service tax is not applicable at all in respect of this construction. He supports his say by quoting the definition of residential complex as provided under Section 65 (91a) of the Finan....
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....eep Kumar Biswas's case (supra)." * They have also cited certain other case laws to state that M/s GSPHCL is an arm of the state and therefore, services provided to them are not leviable to service tax. He also quoted the judgment in the case of Pradeep Kumar Biswas, wherein certain tests have been laid down for determining a body to be a state under Article 12. These tests are as follows: "(1) Principles laid down in Ajay Hasia are not a rigid set of principles so that if a body falls within any one of them it must ex hypothesi, be considered to be a State within the meaning of Article 12. (2) The Question in each case will have to be considered on the bases of facts available as to whether in the light of the cumulative facts as established, the body is financially, functionally, administratively dominated, by or under the control of the Government. (3) Such control must be particular to the body in question and must be pervasive. (4) Mere regulatory control whether under statute or otherwise would not serve to make a body a State." * The adjudicating authority has wrongly relied on CBIC Circular dated 24.05.2010 without e....
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....od should not be invoked in this case. Otherwise also, there is no suppression of facts in the instant case. * Penalty under Section 76, can be imposed only if the assessed tax is not paid. Also, penalty under Section 76 and 78 both cannot be simultaneously imposed. The penalty under Section 77 cannot be imposed since prior to 10.05.2008, it provided for penalty only if no other penalty was imposed under any other section. They request for waiver of penalty under the Provisions of Section 80 of the Finance Act, 1994 and cited the decision of CESTAT New Delhi in the case of CCE-Meerut-II vs On Dot Couriers & Cargo Ltd. 2006 (6) STJ 337 (CESTAT, New Delhi). 3. During hearing, learned Chartered Accountant reiterated the grounds taken in their appeal and also cited certain other case laws. Specific mention was made to the decision of this Tribunal in the case of Shanti Constructions vs CCE&ST Rajkot, (Final order No. 1155611558/2023 dated 24.07.2023) wherein it was held that service tax liability does not arise on construction of residential complex for Gujarat State Police Housing Corporation Limited. He also relied on the decision in the case of CR Patel vs CCE&ST -Surat-....
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....f the Finance Act, 1994 and were leviable to tax. He also cited CBIC Circular No. 128/10/2010-ST dated 24.08.2010, CBIC Circular No. 98/1/2008/ST dated 04.01.2008 and CBIC Circular No. 332/16/2010-Tru. dated 24.05.2010 to press that the work contract services provided by the appellant to M/s GSPHCL and others were liable to service tax. 5. Heard the rival submissions. There are three issues to be decided in this case out of which two relates to construction of residential complex by the appellant for M/s GSPHCL (one for the period prior to 01.06.2007) and the second one for the period post 01.06.2007). The 3rd issue pertains to demand of service tax on GTA Service under Reverse Charge basis. 5.1 It is the argument of the appellant that M/s GSPHCL are 100% owned by the Government of Gujarat and therefore, service of construction of residential complex has been provided to the Government. Their another argument is that the residential complex so constructed is for use of Police Personnel/ employee of the State Government in other undertakings. He therefore, on above two counts pleads that no service tax liability arises on them. The department, on the other hand, argues that in....
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....se as per the definition, service tax is not attracted. Personal use has been defined as permitting the complex for use as residence by another person on rent or without consideration. In this case what emerges is that ITC intended to provide the accommodation built to their own employees. Therefore, it is covered by the definition of "personal use" in the explanation. The next question that arises is whether it gets excluded under the circumstances. The circular issued by C.B.E.&C. on 24-5-2010 relied upon by the learned counsel is relevant. Para 3 of this circular which is relevant is reproduced below : "3. As per the information provided in your letter and during discussions, the Ministry of Urban Development (GOI) has directly engaged the NBCC for constructing residential complex for Central Government officers. Further, the residential complexes so built are intended for the personal use of the GOI which includes promoting the use of complex as residence by other persons (i.e. the Government officers or the Ministers). As such the GOI is the service receiver and NBCC is providing services directly to the GOI for its personal use. Therefore, as for the instant....
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....-tax department on rent and therefore, it is excluded from the definition of construction services. He also relies upon the reply given by the Central Board of Customs and Excise to National Building Construction Corporation Limited (NBCC), vide Letter No. F. No. 332/16/2010-TRU., dated 24-5-2010, in support of this contention. On the other hand, learned DR submits that it is not correct to say that service has been provided to Govt. of India directly. He submits that the land is owned by Income-tax department and Income-tax department has requested the CPWD to construct the quarters for them and funds have been made available to CPWD by Ministry of Finance for this purpose. CPWD in reality has acted as a bridge between Income-tax department and the contractor and after the residential complex is constructed, the same was handed over by CPWD to Income-tax department and therefore, in terms of the clarification issued by the Board also, the appellant would be liable to pay service tax. He drew our attention to the letter relied upon by the learned advocate and submitted that in that letter, it has been clarified by the Board that if NBCC were to construct residential accommodation a....
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....refore, we are unable to agree with the learned Commissioner when he says that the exclusion clause in the definition cannot be applied to the Govt. of India. For ready reference, definition of Construction of Complex Services is reproduced :- (a) Construction of a new residential complex or a part thereof; or (b) Completion and finishing services in relation to residential complex such as glazing, plastering, painting, floor and wall tiling, wall covering and wall preparing, wood and metal joinery and carpentry, fencing and railing, construction of swimming pools, acoustic applications or fittings and other similar services; or (c) Repair, alteration, renovation or restoration of, or similar services in relation to, residential complex] The definition of residential complex service has been given under clause (91a) of Section 65 as under; "Residential complex" means any complex comprising of- (i) a building or buildings, having more than twelve residential units; (ii) a common area; and (iii) any one or more of facilities or services such as park, lift, parking space, community hall, common water supply or eff....
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....eason to resort to suppression or mis-declaration of the facts to avoid payment of service tax since if the service tax was liable, as per the contract, CPWD was liable to pay service tax. Under these circumstances, invocation of extended time limit cannot be justified in this case. Therefore, penalties imposed under various sections of Finance Act, 1994 also cannot be upheld. 4. Another alternative submission made by the learned advocate was that the contract between the appellant and the CPWD was a works contract and VAT has been paid treating the same as works contract and therefore, no service tax was liable to be paid for the period prior to 1-6-2007. He has cited several decisions in support of this contention. However, we find that the decision of the Tribunal in the case of Cemex Engineers v. Commissioner of Service Tax Cochin - 2010 (17) S.T.R. 534 (Tri. - Bang.) is relevant. In this case, the Tribunal had considered the definition of residential complex services and works contract services and had come to the conclusion that in view of the fact that construction of new residential complex was included in the definition of works contract, the construction of resid....
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.... They have accepted liability of service tax on expenses which they claim are over Rs. 1500 per trip. They however have challenged the demand of service tax on an amount of Rs. 77,70,736/- on the ground that the charges per trip are less than Rs.1500 which are exempt from service tax under notification No. 34/2004 dated 03.12.2004 which exempts the taxable service provided by a goods transport agency [to any person], in relation to transport of goods by road in a goods carriage, from the whole of service tax leviable thereon under section 66 of the said Act, where, - (1) the gross amount charged on consignments transported in a goods carriage does not exceed rupees one thousand five hundred, or (ii) the gross amount charged on an individual consignment transported in a goods carriage does not exceed rupees seven hundred fifty. Explanation. For the purposes of this notification, "an individual consignment" means all goods trans-ported by a goods transport agency by road in a goods carriage for a consignee. 2. This notification shall come into force on the first day of January, 2005. 5.5 We find that the learned Adjudicating authority in para....