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2019 (1) TMI 1817 - AT - Service TaxLevy of service tax - EPC contract - It was the view of the revenue authorities that the said EPC contract, even it is for construction of canals/pipelines to conduit irrigation and even for non-commercial purposes, is liable to service tax - HELD THAT - There are strong force in the contentions raised by the Learned Counsel that appellant s Appeal ST/918/2011 on the very same execution of the contract in respect of SRIPADA SAGAR PROJECT Phase-I was disposed of in favour of the appellant in Larger Bench decision of Lanco Infratech Ltd. 2015 (5) TMI 37 - CESTAT BANGALORE (LB) holding that these activities of appellant as per the contract are not liable for service tax and would not fall within the ambit of clause (v), explanation (ii) of Section 65(105)(zzzza). Appeal allowed - decided in favor of appellant.
Issues involved:
Interpretation of EPC contract for service tax liability on construction activities. Analysis: The appeal was against an Order-in-Original regarding a contract for the SRIPADA SAGAR PROJECT. The revenue authorities contended that the EPC contract, even for non-commercial purposes, is liable to service tax under Works Contract Services. The appellant contested this, leading to the confirmation of demands and penalties by the adjudicating authority. The issue involved subsequent notices post the original show cause notice, which was covered by a Larger Bench judgment in the case of Lanco Infratech Ltd. The appellant cited this judgment in their favor, which held that the activities under the contract were not liable for service tax. Upon careful consideration and perusal of records, the Tribunal found merit in the arguments raised by the appellant. The Tribunal noted that the activities under the contract did not fall within the ambit of the relevant section for service tax liability. In line with the precedent set by the Larger Bench decision in Lanco Infratech Ltd., the Tribunal held that the impugned order was unsustainable and set it aside, allowing the appeal in favor of the appellant. The decision was pronounced in the open court at the conclusion of the hearing.
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