TaxTMI 
TaxTMI 
2026 (3) TMI 1449
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....nterfere with the penalty imposed under Section 78 of the Finance Act, but however, observing that the quantum of penalty would get proportionately reduced based on the revised service tax demand. 2. Briefly stated, the facts of the case are that the appellant is an electrical contractor engaged in installation of electrical gadgets and registered as a service provider of maintenance and repair service. On verification of records, Department observed that the appellant had undertaken the work of supply and installation of electrical gadgets to BSNL, CPWD and certain private parties. It appeared that the appellant has not remitted the service tax for the services rendered to BSNL for the period from 16.06.2005 to 30.09.2006 and also has not remitted the service tax for the services rendered to CPWD for the period from 16.06.2005 to 31.03.2009. 3. Hence, a Show Cause Notice dated 14.07.2009 was issued alleging that the activities of the appellant are covered under the category of 'Erection, Commissioning and Installation Service' as per Section 65(39a) of the Finance Act. The Notice also invoked extended period of limitation, alleging that the appellant did not intimate the dep....
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....which it was already registered. The appellant has neither collected nor paid service tax prior to October 2006 in respect of such activity to BSNL. 5. Ld. Counsel contented that the entire demand under dispute pertains to activities that were either pure supplies, or composite contracts involving supply of electrical wirings and related fittings that was provided by the appellant in Government Building. Thus, the disputed turnover pertains to the composite contracts for electrification and related work undertaken by the appellant for CPWD and BSNL for the period from 16.06.2006 to 31.03.2009. 6. Ld. Counsel argued that the Honourable Supreme Court in the case of Larsen and Toubro Vs. CCE, Kerala, 2015 (39) STR 913 (SC), held interalia that composite contract for supply of goods and services cannot be taxed under any category at all prior to 01.06.2007 and that service tax is chargeable only consequent to the introduction of 'Works Contract Services' from 01.06.2007, as the taxable framework for composite complex were put in place only with effect from 01.06.2007. It was contended that the Supreme Court decision has been followed by this Tribunal and the Tribunal has consiste....
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....as tenable? 10. The classifications relevant for the purpose of addressing these issues, as they existed in the Finance Act, 1994, for the relevant period are as under: Section 65(39a) "erection, commissioning or installation" means any service provided by a commissioning and installation agency, in relation to,- (i) erection, commissioning or installation of plant, machinery, equipment or structures, whether pre-fabricated or otherwise or (ii) installation of- (a) electrical and electronic devices, including wirings or fittings therefore; or (b) plumbing, drain laying or other installations for transport of fluids; or (c) heating, ventilation or air-conditioning including related pipe work, duct work and sheet metal work; or (d) thermal insulation, sound insulation, fire proofing or water proofing; or (e) lift and escalator, fire escape staircases or travelators; or (f) such other similar services; 11. Section 65(105)(zzd) stipulates "taxable service" means any service provided or to be provided to any person, by a commissioning and installation agency in relation to erection, commissioning or i....
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.... they are registered with the State Sales Tax/VAT authorities and are discharging sales tax/VAT under works contract tax option and thus their services involve supply of both material and labour and are composite in nature. The Appellant also submitted CA certificate vide their letter dated 02-08-2010, under acknowledgement, in support of their contentions. The Adjudicating Authority has gone on to hold that the introduction of works contract does not suggest that the services were not taxable earlier and that as there is no scope to interpret erection, commissioning or Installation services which are in the nature of works contract is not taxable for the relevant period went on to hold that the Appellant is liable to pay service tax under 'Erection, Commissioning and Installation Service", which was as proposed in the SCN. 14. We find that the Appellate Authority has while affirming the finding of the Adjudicating Authority that the services of the Appellant are classifiable under "Erection, Commissioning and Installation Service" has however held that a contract of erection, commissioning or installation service is one of the contracts specified under the above definition of w....