2015 (9) TMI 48 - AT - Service Tax

Commercial or Industrial Construction Services - Inclusion of value of free supply of materials - held that - adjudicating authority observed that the service provider recovers the cost of the activities either in cash or by other consideration then the value of such service and material are required to be added in the assessable value for charging tax. Learned Advocate also submits that adjudicating authority had not properly considered the other issues. In our considered view, the adjudicating authority should reconsider the main issues, in the light of decision of the Tribunal in the case of Bhayana Builders (P) Limited & Others (2013 (9) TMI 294 - CESTAT NEW DELHI (LB)) and also other issues. - Matter remanded back - Decided in favour of assessee.

Summary

Issues:
1. Early hearing application for appeal
2. Demand of service tax under "Commercial or Industrial Construction Services" for 2007-08 to 2011-12
3. Inclusion of free supply of materials in taxable value
4. Consideration of other issues by the adjudicating authority

Analysis:
1. The applicant sought early hearing of the appeal, which was granted by the Tribunal after a detailed hearing, leading to a decision that the appeal could be adjudicated at that stage.

2. The adjudicating authority had confirmed the demand of service tax under the category of "Commercial or Industrial Construction Services" for the period 2007-08 to 2011-12. The appellant contended that a significant part of the demand was related to the value of free issue of materials, arguing that it should be included in the taxable value. Reference was made to the Tribunal's decision in the case of Bhayana Builders (P) Limited & Others vs. CST, Delhi - 2013 (32) STR 49 (Tri. Del.).

3. Upon reviewing the impugned order, the Tribunal noted that the adjudicating authority had not thoroughly considered all issues, especially regarding the treatment of free supply of materials in the taxable value. The Tribunal directed the adjudicating authority to reexamine the main issues, taking into account the Tribunal's decision in the case of Bhayana Builders (P) Limited & Others and any other relevant cases.

4. Consequently, the Tribunal set aside the impugned order and remanded the matter to the adjudicating authority for a fresh decision in line with the Tribunal's decision in the case of Bhayana Builders (P) Limited & Others and other applicable legal principles. The adjudicating authority was instructed to provide a proper opportunity for a hearing before making a decision. The early hearing application was dismissed as unnecessary, and the appeal was allowed to proceed by way of remand.