2017 (9) TMI 417 - AT - Service Tax

Construction services - N/N. 01/2006 - denial of benefit on the premise that the services provided by the appellant are in relation to completion and finishing services, and as such abatement not available - Held that - the impugned order has not fully examined the facts and submissions of the appellant where they state that their civil construction work not exclusively in the nature of completion and finishing services and that in case of the construction of the buildings for use by SWF, the buildings were to be used for the purpose of social welfare and for non-commercial activities - matter requires reconsideration - appeal allowed by way of remand.

Summary

Issues:
1. Denial of benefit under Notification No. 15/2004 and Notification No. 01/2006
2. Taxability of construction services for charitable institutions
3. Service tax liability confirmation

Analysis:
1. The appellant, engaged in construction services, appealed against the denial of benefits under Notification No. 15/2004 and Notification No. 01/2006. The impugned order held that abatement was not admissible as the services provided were considered completion and finishing services. The appellant argued they did not exclusively provide such services and should be entitled to the abatement facility. The Tribunal found that the impugned order did not fully examine the appellant's submissions and remanded the case for a fresh examination by the Original Adjudicating Authority.

2. The appellant contended that the construction of buildings for a welfare foundation should not attract service tax as the buildings were meant for charitable and non-commercial purposes. The Tribunal acknowledged this argument and directed the Original Adjudicating Authority to reexamine the issue, considering the purpose of the buildings for social welfare activities. The matter was remanded for a fresh assessment after providing the appellant with an opportunity for a personal hearing and submission of relevant documents.

3. The impugned order confirmed a service tax liability of ?6,38,232 along with a penalty against the appellant. However, the Tribunal set aside the order and allowed the appeal by remanding the case back to the Original Adjudicating Authority for a comprehensive reevaluation of the issues raised by the appellant. The decision was made to ensure a thorough examination of the facts and submissions before reaching a final determination on the service tax liability.

This detailed analysis highlights the key issues addressed in the judgment, including the denial of benefits under specific notifications, the taxability of construction services for charitable institutions, and the confirmation of service tax liability. The Tribunal's decision to remand the case for further examination underscores the importance of a comprehensive review of all relevant factors before making a final determination in such matters.