2015 (12) TMI 952 - AT - Service Tax

Rectification of mistake - refund in terms of Section 65(105) of Central Excise Act 1994 - Held that - there is a mistake apparent from the records since it was not a point raised before us by the Revenue at all. Nevertheless we consider that when an individual buyer purchases a flat/apartment in residential complex what he is purchasing is an apartment or a flat and not a part of the complex . If the Revenue s contention was correct there was no need to add explanation in the definition in the year 2010 to bring the individual buyers of flat/apartment in residential complex into service tax net. We do not intend to discuss the issue in detail since it is a legal issue and was not argued before us and it can be challenged in appeal. There is no mistake apparent from the records - Rectification denied.

Summary

Issues:
Rectification of mistake in Final Order regarding liability of individual buyers of apartments in residential complex for service tax.

Analysis:
The Tribunal received applications for rectification of mistake in Final Order Nos. 21770-21779/2014 dated 25.9.2014 filed by the Revenue. The Tribunal had previously held that individual buyers of apartments/flats in a residential complex, based on construction agreement, were not liable to pay service tax before 1.7.2010. The Revenue contended that the Tribunal erred in not considering that the definition of 'Residential Complex' included 'a part of residential complex' as well. The Revenue argued that if a part of the residential complex was taken into account, tax should have been paid even before 1.7.2010.

The Tribunal found that the Revenue's contention was not raised earlier and could not be considered a mistake apparent from the records. The Tribunal emphasized that when an individual buyer purchases a flat/apartment in a residential complex, they are acquiring an apartment or a flat, not a 'part of the complex.' The Tribunal pointed out that if the Revenue's argument was correct, there would have been no need to amend the definition in 2010 to bring individual buyers of flats/apartments under the service tax net. The Tribunal declined to delve into the issue extensively as it was a legal matter not argued before them and could be challenged in appeal. Consequently, the Tribunal rejected the applications for rectification of mistake.

In conclusion, the Tribunal upheld its previous decision regarding the liability of individual buyers of apartments in a residential complex for service tax, emphasizing that the definition of 'Residential Complex' did not include individual units as separate taxable entities.