TaxTMI 
TaxTMI 
TaxTMI 
2026 (1) TMI 520
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....l Charges etc. on which they were not paying the service tax. After conducting investigation, they were issued a show cause notice dated 01.09.2017 for classifying their activity under "Erection, Commissioning and Installation Service" and "Declared Service" and demanding service tax of Rs.33,43,343/- under proviso Section 73(l) of the Finance Act, 1994 along with interest under Section 75 and penalty under Section 77 & 78 of the said Act for suppressing the taxable value of services in their ST-3 returns. 1.1 In Adjudication, the Assistant Commissioner vide Order-in-Original dated 19.03.2019 dropped the demand of Rs.2,09,217/- on penal charges collected from the suppliers and contractors and confirmed the rest demand of Rs.31,34,126/- along with interest under Section 75, equal penalty under Section 78 and a penalty of Rs.10,000/- under Section 77(2) of the Finance Act, 1994. Aggrieved with this order, the appellant filed an appeal before the Commissioner (Appeals) who vide impugned order dated 12.10.2020 observed that the amount collected to pay "Crop Compensation Charges" due to erection of lines on farmer's land is not leviable to service tax. He also held that no service ta....
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....ation end (PART-I). (B) The Work of Feeder Bay, including Erection & Commissioning of Electrical Equipment, to be carried out at the Sub-Station at Applicants' end (PART-II). (C) The Work of the Erection of Transmission Line from GETCO end to Applicants' end, such as, Overhead ETH Line or Underground Cable (PART-III). Four options are given to any applicant who wants deposit work, in Option 1, all three parts are done by GETCO. In Option1A, Part-I and Part-III, are carried out by GETCO, whereas, Part-II is done by the Applicant. In Option-II, only Part-I, is done by GETCO, and rest Part-II and Part-III, are done by the Applicant. In Option-III, all three parts are done by the Applicant. g) They have paid service tax on Erection and Supervision Charges, under the category of "Erection, Commissioning or Installation Service". All portion of Deposit Work, except Supervision Work, are done by Subcontractors who pay service tax. They have not availed CENVAT Credit of service tax, paid by their Sub-Contractors. The demand has been raised on the entire Deposit Work without taking into account availability of CENVAT Credit of service tax paid by ....
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....7.2014 of this Tribunal in the case of Shri Dayalal R. Dhabi Vs. CCE & ST, Rajkot. l) The demand is barred by limitation as show cause notice is issued on 01.09.2017 for the period from March-2012 to March-2016. There is nothing which was suppressed or hidden from the department as other units of GETCO have also been issued show cause notices and therefore, all facts were within the knowledge of the department. They are also not liable to penalty either under Section 77 or under Section 78 of the Finance Act, 1994. They rely on the decision of Mumbai Tribunal in the case of CCE & Cus., Aurangabad Vs. Wockhardt Ltd reported at 2009 TIOL-1308-Cestat-Mumbai and Larger Bench decision in the case of Cosmic Dye Chemical Vs. CCE, Bombay reported at 2002-TIOL-236-SCCX-LB. The appellant prayed for allowing their appeal and setting aside the impugned order. 3. During hearing, learned Advocate highlighted the points taken in their appeal and also cited following case laws decided on the same issue to plead that there is no merit in the department's case and hence, their appeal may be allowed by setting aside the impugned order: - * Final Order No. 10331-10332/2024 dt.06.0....
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....e have heard counter arguments and seen their submissions. Revenue had proposed demand of service tax on amounts collected by the appellant from customers in respect of Material Cost, Erection Charges, Contingency charges, Supervision charges, Pro-rata charges and Development charges, Revenue Loss charges, Row charges and on penalty charges collected from contractors/ suppliers. 5.1 As per appellant's letter dated 09.12.2016, details of amounts collected by them are as under:- I. Cost of Material is the payment received towards reimbursement of actual cost of material. Since, these were not part of service, no service tax is charged on this portion. II. Erection Charges are recovered from the consumer for shifting of overhead cables/ wires. III. Contingency Charges are collected from consumers considering future variations which may arise in the cost of labour and material. If there is no fluctuation in the value of labour and material at the time of issue of final bill, the charges so collected are paid back to the consumers. In case, of upward fluctuation in the cost, the contingency charges so collected are adjusted against the increased cost. When ....
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.... para-12 of which is reproduced below:- "12. So far as the submission of the learned counsel appearing for the petitioner about justification for the extra expenditure incurred by creating facilities on pro-rata basis on the demanded power, which is not based on the working out the actual expenditure that would be required at the particular sub-station and, thereafter, dividing the same amongst the applicants who apply for power from a particular sub-station, is concerned, the respondents have worked out the expected expenditure of entire plant and charge the new applicant on pro-rata basis. The respondents have made it clear that it had become unavoidable for the erstwhile Board to develop infrastructural facilities and continue the same for providing transmission lines and sub-stations to meet power requirements of the new applicants as well existing consumers considering rapid industrial and increasing power demand. As provided in the earlier circular no.676 dated 5-7-1997, the developmental charges was 900 per KVA and, thereafter it was reduced, after considering the representation, to 850/- per KVA as per the notification. Thus, the justification to charge 850/- on pr....
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....ot a taxable service under any clause of sub-section (105) of section 65 of the Finance Act, 1994 3. Laying of electric cables between grids/sub-stations/ transformer stations en route Not a taxable service under any clause of sub-section (105) of section 65 of the Finance Act, 1994. 4. Installation of transformer/ substations undertaken independently Taxable service, namely Erection, commissioning or installation services [section 65(105)(zzd)]. 5. Laying of electric cables up to distribution point of residential or commercial localities/ complexes Not a taxable service under any clause of sub-section (105) of section 65 of the Finance Act, 1994. 6. Laying of electric cables beyond the distribution point of residential or commercial localities/complexes. Taxable service, namely commercial or industrial construction' or 'construction of complex' service [section 65(105)(zzq)/(zzzh)], as the case may be. 7. Installation of street lights, traffic lights flood lights, or other electrical and electronic appliances/devices or providing electric connections to them Taxable service, namely Erection, commissioning or installation services [secti....