2018 (10) TMI 322 - AT - Service Tax

Classification of services - Works contract service - Erection, Commissioning and Installation Service or otherwise? - Sub-contract - service provided to the Delhi Jal Board - Services provided to HUDA Haryana and Urban Development Authority. Whether the services provided by the sub-contractor is falling within the services as mentioned in the show cause notice or elsewhere? Held that - It is the contention of the Ld. Advocate that the services provided were pertaining to the construction of road which is also evident from the work order submitted before us. However, there is a difference in opinion by the Appellant and primary adjudication authority and calculation of gross value for services render as to what are the services actually provided. From the perusal of the appeal record we also find that the appellant has not provided the actual information which was asked by the Department to arrive at the revaluation of Service Tax leviable. In view of the non-cooperation in providing the data as required by the Department for the payment of Service Tax the same was confirmed by the primary adjudicating authority as well as the Ld. Commissioner (Appeal) in the impugned order by applying best judgement. The issue need to be decided by the lower adjudicating authority for considering the entire evidence regarding the nature of the services provided by the appellant - appeal allowed by way of remand.

Issues Involved:
1. Taxability of services provided by the appellant as a sub-contractor to the main contractor.
2. Classification of services provided to Delhi Jal Board and HUDA Haryana and Urban Development Authority.
3. Non-submission of relevant documents by the appellant.
4. Clarification on services provided under different categories like Construction of Commercial or Industrial Construction Services, Construction of Complex (Residential) Services, and Works Contract Service.
5. Discrepancy in the nature of services provided by the sub-contractor and calculation of Service Tax.
6. Lack of cooperation in providing necessary data for the revaluation of Service Tax.

Analysis:

1. The judgment revolves around the taxability of services provided by the appellant as a sub-contractor. The issue primarily focuses on the nature of services provided to Delhi Jal Board and HUDA Haryana and Urban Development Authority. The CESTAT referred to various precedents and circulars to determine that services provided to Delhi Jal Board were non-taxable based on the purpose of the project, emphasizing the distinction between commercial and non-commercial activities.

2. The judgment delves into the classification of services provided, specifically under different categories like Construction of Commercial or Industrial Construction Services, Construction of Complex (Residential) Services, and Works Contract Service. The appellant's failure to submit relevant documents initially led to a demand for Service Tax, which was later contested based on the nature of services provided and the applicable tax categories.

3. The issue of non-submission of relevant documents by the appellant was addressed in the judgment. The appellant eventually provided certificates and work orders to support their claim that the services rendered to Jal Boards were not of a commercial or industrial nature, leading to a conclusion that the demand for Service Tax related to these services was not sustainable.

4. The judgment highlights a discrepancy in the nature of services provided by the sub-contractor and the calculation of Service Tax. The appellant's lack of cooperation in providing necessary data for revaluation led to the confirmation of Service Tax by the primary adjudicating authority and the Ld. Commissioner (Appeal) based on best judgment principles.

5. The judgment emphasizes the need for a detailed examination by the lower adjudicating authority to determine the exact nature of services provided by the appellant. The case was remanded back to the original adjudicating authority for a fresh decision, considering the specific services provided and their classification under relevant tax categories like Work Contract Service.

Overall, the judgment provides a comprehensive analysis of the taxability of services provided by the appellant, addressing issues related to classification, documentation, cooperation in providing data, and the need for a detailed examination to arrive at a fair decision regarding the Service Tax liability.

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