TaxTMI 
TaxTMI 
2026 (5) TMI 925
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....The department has taken various grounds in support of their contention that the impugned order is not legal and proper as Commissioner has not considered certain aspects while deciding the issue. 2. The brief facts of the case are that the respondents i.e., M/s Sri Comfort Air Products & Services, are, inter alia, engaged in providing various taxable services like Works Contract Service (WCS), Management, Maintenance or Repair service (MMRS), Erection, Commissioning & Installation Service (ECIS), Business Auxiliary Service (BAS) and Goods Transport Agency Service (GTA). It was noticed that the respondents were executing work orders relating to supply of outdoor units/indoor units of Air Conditioning Systems (AC) and their installa....
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..../40% of the value of low side work/HVAC work as the said value did not include the value of the plant, machinery, equipment, etc., and therefore, the service tax should have been paid on the full value. 4. Learned AR for the department is mainly contesting that there are clearly two parts in the agreement, whereas, one part for supply/sale of AC systems is being treated as sale, however, other part of the work order, which essentially deals with the activity of installation, commissioning, etc., and also incidental elements of piping, wiring, ducting, etc., is covered under the category of service. Essentially, his argument is that one aspect is clearly identified activity i.e., supply of AC systems, whereas, the second aspect is relatin....
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....ould not be possible to execute the said low side works/HVAC works and therefore, the property in such materials would get transferred to the service recipient. He has also pointed out that it is an admitted position that they have paid VAT. He has also relied on the Board Circular dt.22.05.2007, wherein, inter alia, it was clarified that contracts, which are treated as works contract for the purpose of levy of VAT/sales tax shall also be treated as works contract for the purpose of levy of service tax. He has also relied on the judgment of Hon'ble Bombay High Court in the case of Gammon India Vs CCE, Nagpur [2015 (37) STR 225 (Mum)], wherein, the contract was treated as works contract and even though there was separate supply contract for ....
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....ide works/HVAC works and that the decision in the case of Gammon India Vs CCE, Nagpur (supra) relied upon by the Commissioner is distinguishable on facts as in the said case, there is a finding as to the substantial quantum of material involvement in the service contract. 8. We have perused the impugned order and we find that the Commissioner has categorically held that the service provider has been awarded two types of work orders and in the case of installation and commissioning, for which a separate work order has been received, also involves transfer of property in the goods. He also noted that the value of the low side works include supply of certain material on the basis of certain invoices issued to the extent of rendering install....