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2014 (12) TMI 871 - AT - Service TaxWaiver of predeposit of tax - Commercial and Industrial Construction Service - Held that - Exemption Notification No. 45/2010-ST dated 20.07.2010 is relating to the transmission and distribution of electricity provided by the service provider to the service recipient. The Tribunal in the case of K. Shanmugavelu (2014 (7) TMI 936 - CESTAT CHENNAI), allowed the appeal in respect of contract with TNEB to facilitate erection of electricity transmission tower. In the present case, it is construction of buildings. Therefore, the said case law and the exemption Notification, prima facie, would not apply to the facts of the present case. Regarding demand of tax on Gandhigram Rural University, we find from the impugned order that the Gandhigram Rural University was collecting certain fees prescribed for imparting skills/ working knowledge on different fields. The case of Viswanathan Constructions Pvt. Ltd. (2013 (12) TMI 47 - CESTAT CHENNAI), as relied upon by the Ld. Advocate is in respect of construction of building by local municipal authorities for training of industrial workers, prima facie, would not apply to the facts of the present case - Partial stay granted.
Issues:
1. Application for waiver of predeposit of tax under 'Commercial and Industrial Construction Service'. Analysis: The applicant sought waiver of predeposit of tax amounting to Rs. 6,15,809/- with interest and penalty for the period 01.05.2006 to 23.02.2009 under the category of 'Commercial and Industrial Construction Service'. The demand of tax was related to the construction of the Control Room of TNEB at Madurai Meenakshiamman Temple and buildings for Gandhigram Rural University. The applicant argued that the tax demand for the TNEB construction was exempted retrospectively by Notification No. 45/2010-ST, citing relevant tribunal decisions. However, the Tribunal found that the exemption was related to electricity transmission, not construction, and thus did not apply. Similarly, the tax demand for Gandhigram Rural University construction was not considered exempt as the university collected fees for imparting skills, distinguishing it from the case law cited by the applicant. The Tribunal concluded that the applicant failed to establish a strong prima facie case for the waiver of the entire tax amount with interest and penalty. Despite the applicant's financial hardship due to being out of business since 2009, the Tribunal directed a pre-deposit of Rs. 1,50,000/- within eight weeks. Upon this deposit, the balance tax amount along with interest and penalty would be waived, and recovery stayed until the appeal's disposal. The compliance was to be reported by a specified date. In summary, the Tribunal denied the full waiver of the tax amount requested by the applicant under the 'Commercial and Industrial Construction Service'. Instead, a partial pre-deposit was ordered, considering the lack of a strong prima facie case and the applicant's financial hardship.
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