TaxTMI 
TaxTMI 
2026 (10) TMI 391
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....of Rs. 57,25,57,532/- for various services provided by it to its clients. The appellant had not provided any documents or balance sheets to show that the amounts received were gross amounts nor did it file any ST3 returns. Accordingly, it was proposed to carry out best judgment assessment under section 72 of the Finance Act, 1994 [the Act] and demand service tax of Rs. 7,07,68,111/- under section 73 of the Act being 12.36% of the total value received by the appellant. 3. The appellant submitted its reply to the show cause notice and resisted the proposals. After considering the submissions, the Commissioner passed the impugned order confirming service tax demand of Rs. 2,18,69,271/- as service tax and dropped the remaining demand. He also imposed a penalty of Rs. 21,00,000/- under section 76 of the Act on the appellant and further imposed a penalty of Rs. 10,000/- under section 77(2) of the Act for not filing the returns. 4. Aggrieved, the appellant filed this appeal. However none appeared on behalf of the appellant. The appellant has been seeking adjournments repeatedly. Therefore, by an order dated 08.12.2024 this appeal was dismissed for non-prosecution. Thereafter, the ap....
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....vice Tax liability of the Noticee during the period 2012-13 comes to Rs. 2,18,69,271/- instead of Rs. 2,00,97,995/- as claimed by the Noticee, as detailed below: TABLE - A Service Contracts only S.No. Name of the Client Taxable Amount (in Rs.) S.Tax @ 12.36% (in Rs.) 1 Amrit Bottlerd Ltd 21,74,980 2,68,828 2 Spacon Engineers & Contractor Pvt Ltd 38,44,148 4,75,197 3 Delhi Edu. Charitable & Foundation 13,19,257 1,63,060 4 Triump Softtech Pvt Ltd 2,94,000 36,338 5 TDI Infrastructure 2,33,76,161 28,89,293 Total 3,10,08,546 38,32,656 TABLE - B Work Contracts to Company S.No Name of the Client Gross Work Done (in Rs.) Amt. After 60% abatement (in Rs.) S.Tax @ 12.36% (in Rs.) 50% of the ST payable by the Noticee (in Rs.) 1 Ajnara Infrastructu re Pvt Ltd 2,66,56,181 1,06,62,472 13,17,882 8,58,941 2 Aggarwal Associates (Promoters) Ltd 13,81,09,454 5,52,43,782 68,28,131 34,14,066 3 APV Reality Ltd 1,09,73,714 43,89,486 5,42,540 2,71,270 4 MPG Realty Pvt Ltd 18,46,07,666 7,38,43,066 91,27,003 45,63,502 ....
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....rovisions of section 67, the value of service portion in the execution of a works contract, referred to in clause (h) of section 66E of the Act, shall be determined in the following manner, namely:- (i) Value of service portion in the execution of a works contract shall be equivalent to the gross amount charged for the works contract less the value of property in goods transferred in the execution of the said works contract. Explanation.- For the purposes of this clause,- (a) gross amount charged for the works contract shall not include value added tax or sales tax, as the case may be, paid or payable, if any, on transfer of property in goods involved in the execution of the said works contract; (b) value of works contract service shall include, - (i) labour charges for execution of the works; (ii) amount paid to a sub-contractor for labour and services; (iii) charges for planning, designing and architect's fees; (iv) charges for obtaining on hire or otherwise, machinery and tools used for the execution of the works contract; (v) cost of consumables such as water, electricity, fuel used in the executio....
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.... after deducting- (i) the amount charged for such goods or services, if any; and (ii) the value added tax or sales tax, if any, levied thereon: Provided that the fair market value of goods and services so supplied may be determined in accordance with the generally accepted accounting principles. Explanation 2.- For the removal of doubts, it is clarified that the provider of taxable service shall not take CENVAT credit of duties or cess paid on any inputs, used in or in relation to the said works contract, under the provisions of CENVAT Credit Rules, 2004. 11. As per the above rule, taxable value shall be determined after excluding the value of goods from the gross amount charged if it is possible and if not, it should be charged only on 40% of the gross amount charged. Further as per Notification No. 30/2012-ST dated 20.06.2012, 50% of the tax liability has to be discharged by the service recipient and only 50% can be fastened against the service provider. 12. The third submission of the appellant is that for the calculating the gross amount charged for works contract, the value of free of cost material supplied by different customers should not be ....
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....d that the Commissioner has, in the impugned order, included all services provided to M/s Agarwal Promoters Limited, M/s MPG Reality Pvt Ltd and Shri Agrasen North Ex Welfare Society (Reg.) in Table C and has allowed the abatement. Further, we find that where the service recipient was supposed to discharge the service tax, the Commissioner had also reduced the service tax liability, accordingly. Therefore, we find no infirmity in the confirmation of demand during this period. 15. As far as the service tax liability during the period July 2012 to March 2013 is considered, the submission of the appellant is that works contract services are entitled to abatement under rule 2A of the Valuation Rules either by deducting the actual value of the goods used or on presumptive basis. We find that in Tables B and C, the Commissioner has calculated the service tax after considering the abatement and also after considering the 50% service tax liability payable by the service recipient wherever applicable. Nothing has been brought out before us to show the appellant had produced the actual figures of the value of the goods used and it was more than the abatement allowed. We, therefore, find n....