9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2024 (3) TMI 758 - AT - Service TaxRefund of service tax paid as sub-contractor - Rejection on the ground that Section 102 exempts services rendered to a Government a local Authority or a Government Authority and does not exempt services rendered to a private company which in this case is M/s NBCC. Revenue states that the main contractor M/s NBCC could have applied for refund under Section 102 but have not done so. Because the main contractor had failed to apply for refund it does not mean that the sub-contractor can claim refund of that amount. HELD THAT - It is not in dispute that the ultimate client in this case is University of Lucknow which is an educational establishment. ONGC Centre of Advanced Studies of this educational establishment was being constructed by the main contractor M/s NBCC and a portion or that work has been sub-contracted to the Appellant. The exemption available to the services provided to University of Lucknow does not depend on whether such services are provided directly by the main contractor or by the main contractor using the services of a sub-contractor. In view of the above it is found that on merits the services rendered by the Appellant through the main contractor to University of Lucknow are exempted under Section 102 of the Finance Act 1994. The application for refund has been filed within the time stipulated in the Section. As long as the service is rendered to a client the taxability has to be decided accordingly regardless of whether the service was rendered directly by the main contractor or through a subcontractor or through a sub-sub-contractor. Accordingly the Appellant is not liable to pay service tax as he has already paid the same and he is entitled to refund under Section 102 of the Finance Act 1994. The impugned order set aside - appeal allowed.
Issues Involved:
1. Eligibility for service tax exemption under Section 102 of the Finance Act, 1994. 2. Appropriateness of the refund claim filed by the sub-contractor instead of the main contractor. 3. Interpretation of the term "governmental authority" in the context of exemption notifications. Summary: 1. Eligibility for Service Tax Exemption: The Appellant, a sub-contractor for M/s NBCC, provided services for the construction of the ONGC Centre of Advanced Studies at the University of Lucknow. The Appellant claimed a refund of Rs. 51,38,112/- paid as service tax, arguing that the services were exempt under Section 102 of the Finance Act, 1994. This section exempts services provided to a Government, a local authority, or a Governmental Authority. The lower authorities denied the refund, stating that the exemption does not apply to services rendered to a private company like NBCC. 2. Appropriateness of the Refund Claim: The Revenue contended that the main contractor, NBCC, should have filed the refund claim as they rendered services to the University of Lucknow. The Appellant argued that the nature of the service would not change whether provided directly by the main contractor or through a sub-contractor. The Tribunal agreed with the Appellant, stating that the exemption applies as long as the service is rendered to the ultimate client, which in this case is the University of Lucknow, an educational establishment. 3. Interpretation of "Governmental Authority": The Tribunal referred to the Supreme Court judgment in the case of Commissioner, Customs Central Excise & Service Tax, Patna vs. M/s Shapoorji Pallonji And Company Pvt. Ltd., which clarified the definition of "governmental authority" under exemption notifications. The Supreme Court held that the term should be interpreted to include entities set up by an Act of Parliament or a State Legislature, even if they do not have 90% or more government participation by way of equity or control. Conclusion: The Tribunal found that the Appellant's services were indeed exempt under Section 102 of the Finance Act, 1994, and the refund claim was filed within the stipulated time. The Tribunal set aside the impugned order and allowed the appeal with consequential relief, following the Supreme Court's interpretation of "governmental authority." Order: The appeal is allowed with consequential relief as per law. (Order pronounced in open court on 15th March, 2024).
|
