2013 (1) TMI 190 - AT - Service Tax

Commercial & Industrial Construction services - Service Tax liability for the period 10.07.2004 to 10.09.2004 - assessee contested that work was initiated before the Service Tax liability on Commercial & Industrial Construction services came into existence i.e. 10.07.2004 & completed on 10.09.2004 - Held that - The contract for construction was entered into by the appellant with the service receiver on 10.07.2004. The scope of contract, undoubtedly, includes all the works as per contract i.e. the work of excavation onwards upto the construction of structures for the service recipient. Assessee s arguments does not boost any confidence as at this juncture that in two months, the appellant could not have completed 75% of the job which has been given to him. The issue is arguable one - the appellant has not made out a prima facie case for complete waiver of pre-deposit accordingly directed to deposit an amount of Rs.2.50 lakhs within a period of eight weeks from today and report compliance on 14.11.2012.

Summary

Issues:
Waiver of pre-deposit of Service Tax, interest, and penalty amount confirmed by adjudicating authority for Commercial & Industrial Construction services.

Analysis:
The Stay Petition was filed seeking a waiver of pre-deposit of Service Tax, interest, and penalty totaling Rs.11,87,247, confirmed by the adjudicating authority and upheld by the first appellate authority for the period 10.07.2004 to 10.09.2004 under Commercial & Industrial Construction services. The appellant argued that the construction work was initiated before the Service Tax liability came into existence and completed between 10.07.2004 and 10.09.2004, although bills were raised subsequently. The appellant provided agreements and certificates to support their claim. The Department contended that the appellant could not have completed 75% of the job within two months as per the contract. The Tribunal noted the contract was entered into on 10.07.2004, covering excavation to structure construction, and questioned the feasibility of substantial work completion within the short period. The Tribunal found the issue arguable but concluded that the appellant did not establish a prima facie case for a complete waiver of pre-deposit.

The Tribunal directed the appellant to deposit Rs.2.50 lakhs within eight weeks and report compliance by a specified date. Upon compliance, the waiver of pre-deposit for the balance amounts was allowed, and recovery stayed pending appeal disposal. The decision balanced the appellant's arguments with the need for a partial deposit, indicating a lack of strong evidence for a full waiver. The Tribunal's ruling provided a structured approach by allowing partial relief while ensuring a deposit to proceed with the appeal process. The judgment emphasized the importance of evidentiary support and the need to meet procedural requirements for seeking financial reliefs in tax matters.