2016 (9) TMI 1104 - AT - Service Tax

Waiver of pre-deposit - Classification - site clearance, excavation, earth/sand filling etc. - whether to be classified as pre-commissioning activities under Commercial and Industrial Construction service or to be classified under Erection, Commissioning and Installation service - Held that - on perusal of the work order placed by HPCL, we find that the work assigned thereunder relate to civil construction, which fall under the category of Commercial and Industrial Construction service. We also find that in an identical case, this Tribunal in the case of Subhash Khandelwal & Sons vs. CCE, Jaipur - I 2011 (9) TMI 417 - CESTAT, NEW DELHI has allowed the appeal holding that pre-commissioning activities should be categorised as civil construction work. Therefore, we are of the prima facie view that the appellant has made out a good case for waiver of pre-deposit. - Stay granted

Summary

Issues:
1. Classification of services under taxable categories.
2. Imposition of penalties under Sections 76 and 77.
3. Time limitation for proceedings initiated by the Department.

Classification of services under taxable categories:
The appeal was filed against the impugned order confirming a service tax demand along with penalties under Sections 76 and 77. The appellant argued that the services provided, such as site clearance and excavation, fell under the category of Commercial and Industrial Construction service, not Erection, Commissioning, and Installation service as classified by the Department. The appellant relied on a previous Tribunal decision to support the argument that pre-commissioning activities of civil nature do not involve installation or commissioning of machinery. The Tribunal found that the appellant was registered for providing Commercial or Industrial Construction service, and the work assigned by Hindustan Petroleum Corporation Ltd. (HPCL) related to civil construction, aligning with the appellant's service category. Citing the previous Tribunal decision, the Tribunal agreed that pre-commissioning activities should be treated as civil construction work, supporting the appellant's case for waiver of pre-deposit. Consequently, the stay application was allowed, and recovery of dues was stayed pending appeal disposal.

Imposition of penalties under Sections 76 and 77:
In the impugned order, penalties under Sections 76 and 77 were imposed along with the confirmed service tax demand. The appellant did not challenge these penalties directly in the appeal. Instead, the focus was on the classification of services and the time limitation for proceedings. The Tribunal did not provide a specific analysis or ruling on the imposition of penalties under Sections 76 and 77, as the primary decision revolved around the classification of services and the grant of a stay on recovery pending appeal disposal.

Time limitation for proceedings initiated by the Department:
The appellant argued that the proceedings initiated by the Department for confirmation of the adjudged demand were barred by the limitation of time. However, the Tribunal did not delve into a detailed analysis of this issue in the judgment provided. The focus of the Tribunal's decision was on the classification of services and the grant of a stay on recovery pending appeal disposal. As a result, the Tribunal did not explicitly address the time limitation aspect raised by the appellant in the judgment summary provided.