TaxTMI 
TaxTMI 
2026 (4) TMI 1157
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....-09-2010, demanding Service Tax for the period from April 2009 to June 2010 and a subsequent Show Cause Notice dated 02-09-2011, demanding Service Tax for the period July 2010 to March 2011 along with appropriate interest and proposing to impose penalties under the provisions of the Finance Act, 1994 (Act). After due process of law. the Adjudicating Authority vide common Orders in Original No. 229 & 230/2012 dated 27.12.2012, (OIO), confirmed the demands as proposed in the notices along with the appropriate interest and impose penalties under Section 76 and 77 of the Act. In the OIO the Adjudicating Authority held that the impugned notices are periodical and is a sequel to the earlier Show Cause Notice covering period from 01-04-2006 to 313-2010 and the proceedings initiated therein has resulted in the Commissioner of Central Exercise, Chennai-I passing the Order-in-Original No. 04/2011 dated 07-03-2011 classifying the construction activity at Golden Treasure Phase-1 at Vanagaram, Chennai consisting of 106 flats as "construction of residential complex service" and confirmed the service tax demand besides ordering payment of interest and imposing penalties. The Adjudicating Authorit....
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....heard the rival submissions and perused the materials available on record. 8. At the outset, we find that the miscellaneous application filed by the Appellant raise questions of law that have a bearing on the tax liability and the tenability of the proceedings. It is no more res-integra that this Tribunal has jurisdiction to examine such questions of law neither raised before the lower authorities nor in the appeal memorandum but are now sought to be raised. Rule 10 of the CESTAT (Procedure) Rules, 1982 allows the parties to urge ground not taken in the appeal provided the Tribunal grants leave to the parties to do so. In fact, the Tribunal has also been given a wide power to decide the appeal on grounds not taken in the memorandum of appeal, with this power being circumscribed only by the requirement that the party affected must be given an opportunity of being heard in respect of the new grounds sought to be urged. The decisions in National Thermal Power Co. Ltd v. CIT, 1998 (99) ELT 200 (SC) and Devengare Cotton Mills Ltd v. CCE, Belgaum, 2006 (198) ELT 482 (SC) lay down the aforesaid propositions. Thus, we have permitted the grounds to be urged at the Bar and find them also ....
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....esidential 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 effluent treatment system, located within a premises and the layout of such premises is approved by an authority under any law for the time being in force, but does not include a complex which is constructed by a person directly engaging any other person for designing or planning of the layout, and the construction of such complex is intended for personal use as residence by such person. Explanation. - For the removal of doubts, it is hereby declared that for the purposes of this clause, - (a) "personal use" includes permitting the complex for use as residence by another person on rent or without consideration; (b) "residential unit" means a single house or a single apartment intended for use as a place of residence;" 9. A reading of the above clearly indicates that what is sought to be excluded is only a person who directly engages any other person, far from the construction of such complex, which is intended for his personal use as residence. This, read wit....
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....provided by the builder to a buyer where there is an intended sale between the parties whether before, during or after construction; that the 'Explanation' was specifically legislated upon to expand the concept of taxable service; that prior to the explanation, the view taken was that since a mere agreement to sell does not create any interest in the property and the title to the property continues to remain with the builder, no service was provided to the buyer; that the service, if any, would be in the nature of a service rendered by the builder to himself; that the explanation expands the scope of the taxable service, provided by builders to buyers pursuant to an intended sale of immovable property before, during or after the construction and therefore the provision is expansive of the existing intent and not clarificatory of the same; and is consequently prospective". 9. In view of the above, though in view of the Apex Court judgment in the case of M/s. Larsen & Toubro Limited and Others v. State of Karnataka & Others (supra), the agreements entered into by a builder/promoter/developer with prospective buyers for construction of residential units in a residential compl....
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....therefore, hold that there will be no service tax liability on the appellant. 18. The appeal is therefore allowed, to the extent above, with consequential reliefs, if any." 10. In light of the aforesaid decision in respect of the appellant for the very same project, we respectfully follow the same and it is clear that the demand of Service Tax for the period from April 2009 to June 2010 is liable to be set aside on the aforesaid finding of this Tribunal which is not shown to have been appealed against or stayed by any higher Judicial Fora. 11. As regards the demand for the subsequent period in respect of the same project, it is seen that the demand is sought to be confirmed under the head 'construction of complex services'. In this regard, the reliance placed by the appellant on the decision in CCE & ST, Visakhapatnam-I v Pragati Edifice Pvt Ltd, 2019 (31) GSTL 241 (Tri-Hyd) is also found to be apposite as it has been held therein in paragraph 11(i)(n) as under: "(n) To sum up, as far as construction of 'residential complexes' by the builders are concerned : (i) Prior to 1-6-2007, if it is a composite works contract, no Service Tax is leviable in vi....