2010 (9) TMI 304 - AT - Service Tax

Construction Residential Complex - residential complex under Section 65(91a) of the Finance Act 1994 it 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 - quarters constructed for the Police personnel under a contract from the TNPHCL exemption of such quarters from the purview of the service tax on the basis of the definition of residential complex and explanation relating to personal use waiver of pre-deposit - remand all the matters to the original authority for fresh decision

Summary

Issues:
1. Interpretation of the definition of "residential complex" under Section 65(91a) of the Finance Act, 1994 for service tax applicability.
2. Consideration of the plea for exemption from service tax based on the construction of quarters for Tamil Nadu Police personnel.

Analysis:

1. The judgment revolves around the interpretation of the definition of "residential complex" under Section 65(91a) of the Finance Act, 1994. The appellants argued that the quarters constructed for the Tamil Nadu Police personnel under a contract from the Tamil Nadu Police Housing Corporation Ltd. should not attract service tax as per the definition provided. The definition excludes a complex intended for personal use as a residence by the person directly engaging in the construction. The appellants contended that since the quarters were constructed for occupation by police personnel, they should be exempt from service tax. The Tribunal found merit in this argument and decided to remand the matter for a fresh decision, emphasizing the need for a proper hearing before any new orders are passed.

2. The second issue in the judgment pertains to the consideration of a plea for exemption from service tax based on the construction of quarters for Tamil Nadu Police personnel. The appellants had raised this plea in a letter to the Jr. Commissioner of Service Tax, asserting that the construction should be exempt based on the definition of "residential complex" and the explanation regarding "personal use." Despite the letter lacking a date or signature, the Tribunal acknowledged the significance of the plea, especially considering the nature of the construction project. As a result, the Tribunal set aside the impugned orders and remanded all matters to the original authority for a fresh decision, ensuring that the appellants are granted a fair opportunity for a hearing before any new orders are issued. Ultimately, all appeals were allowed by way of remand, highlighting the importance of proper consideration and due process in matters of service tax applicability.

This comprehensive analysis of the judgment highlights the key issues addressed by the Appellate Tribunal CESTAT, CHENNAI, providing a detailed insight into the interpretation of relevant legal provisions and the subsequent decision-making process.