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2024 (12) TMI 1300 - AT - Service TaxClassification of service - activities carried out by the Appellant for the period from 10.09.2004 to 31.01.2009 fall under the category of Erection, Commissioning or Installation service or they fall under the category of Works Contract Service? - invocation of extended period of limitation. Classification of services - HELD THAT - The issue is no more res integra, the issue is settled by the judgment of Hon ble Supreme Court in the matter of COMMISSIONER, CENTRAL EXCISE CUSTOMS VERSUS M/S LARSEN TOUBRO LTD. AND OTHERS 2015 (8) TMI 749 - SUPREME COURT and the activities carried out by the Appellant, which includes supply of goods and materials and when the Appellant had paid VAT as applicable under Works Contract, to consider the gross amount as consideration and to classify the goods under the category of Erection, Commissioning or Installation services is unsustainable. Conclusion - For the period 10.09.2004 to 01.06.2007, the appellant is not liable to service tax under the category of 'Erection, Commissioning or Installation' services in view of the decision of the Hon'ble Supreme Court in the case of M/s. Larsen and Toubro Ltd. Further for the period 01.06.2007 to 31.01.2009 the activity of the appellant is classifiable under 'Works Contract' service and is eligible for composition scheme under Works Contract (payment of Service Tax Composition Scheme) Rules, 2007. Appeal alowed.
ISSUES PRESENTED and CONSIDERED: 1. Whether the activities carried out by the Appellant fall under the category of 'Erection, Commissioning or Installation' service or 'Works Contract' service. ISSUE-WISE DETAILED ANALYSIS: Issue 1: Classification of Services - Relevant legal framework and precedents: The Appellant argued that their activities fall under 'Works Contract' service based on legal precedents, including the judgment of the Hon'ble Supreme Court in CCE, Kerala Vs. Larsen & Toubro Ltd. - Court's interpretation and reasoning: The Tribunal analyzed the nature of the Appellant's activities, including supply of goods and materials, and found that they should be classified under 'Works Contract' service. - Key evidence and findings: The invoices and contracts submitted by the Appellant supported their claim that the activities were in the nature of 'Works Contract' service. - Application of law to facts: The Tribunal applied the legal principles established in previous judgments to determine the correct classification of the Appellant's services. - Treatment of competing arguments: The Revenue argued that the activities fell under 'Erection, Commissioning or Installation' services, but the Tribunal disagreed based on the evidence presented. - Conclusions: The Tribunal concluded that for the period in question, the activities of the Appellant should be classified under 'Works Contract' service. SIGNIFICANT HOLDINGS: - The Tribunal held that the activities of the Appellant should be classified under 'Works Contract' service based on legal precedents and the nature of the services provided. - The Appellant was found not liable to service tax under 'Erection, Commissioning or Installation' services for the period before 01.06.2007 and was eligible for the composition scheme under Works Contract (payment of Service Tax Composition Scheme) Rules, 2007 for the subsequent period. - The appeal was allowed with consequential relief, if any as per law.
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