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2023 (7) TMI 1019 - AT - Service TaxLevy of service tax - construction of Residential Complex for Gujarat State Police Housing Corporation Limited. - HELD THAT - In RIDDHI SIDDHI CONSTRUCTION VERSUS C.C.E. S.T. -VADODARA-II 2023 (5) TMI 340 - CESTAT AHMEDABAD , which has considered various Tribunal decisions, it can be seen that the facts of this case being absolutely identical to the said judgment, the demand of service tax in the present case is also not sustainable - it was held in Ridhi Sidhi Construction that the service provided by the appellant are to establishments and organizations which are of non commercial or non industrial nature and therefore, the construction, renovation, repair work undertaken by them fall under the exclusion of the definition of Commercial or Industrial Construction Service hence, we hold that the appellants are not liable to pay any service tax on such activity. Demand set aside - appeal allowed.
Issues Involved:
1. Liability of service tax for construction of Residential Complex for Gujarat State Police Housing Corporation Limited. Summary: Issue: Liability of Service Tax for Construction of Residential Complex for Gujarat State Police Housing Corporation Limited The issue involved in the present case is whether the appellant is liable to service tax for construction of Residential Complex for Gujarat State Police Housing Corporation Limited. Shri Jigar Shah, learned Counsel for the appellant, argued that the issue is no longer res-integra as it has been consistently decided in favor of the assessee. He cited several judgments, including DH Patel vs. CCE & S.T, Surat, Riddhi Siddhi Construction vs. CCE & ST, Vadodara, and RN Dobariya vs. CCE & S.T, Surat, which supported the appellant's position. Shri Ajay Kumar Samota, representing the Revenue, reiterated the findings of the impugned order, which confirmed the demand for service tax on the construction of the Residential Complex for Gujarat State Police Housing Corporation Limited. Upon careful consideration of the submissions and records, the Tribunal found that the cited judgments addressed identical issues. The Tribunal consistently held that the construction of Residential Complexes for use by government entities, such as Gujarat State Police Housing Corporation Limited, is not liable to service tax under the head 'Construction of Residential Complex'. One significant judgment cited was Ridhi Siddhi Construction vs. CCE & ST, Vadodara, where the Tribunal concluded that construction for non-commercial purposes, such as for municipal services, universities, and police departments, falls under the exclusion clause of 'Commercial or Industrial Construction Service'. The Tribunal noted that these organizations are not engaged in commercial or industrial activities, thus excluding such construction from service tax liability. Similarly, in the case of Anand Construction Co., the Tribunal held that buildings constructed for educational, religious, charitable, health, sanitation, or philanthropic purposes, and not for profit, are non-commercial and therefore not taxable. This was supported by a Board Circular clarifying that government constructions for non-commercial purposes are generally not taxable. Another relevant case was KHURANA ENGINEERING LTD., where the Tribunal ruled that residential complexes constructed for government use, such as for Income Tax department employees, are covered by the 'personal use' exclusion in the definition of 'Construction of Complex' services. Based on these precedents, the Tribunal concluded that the facts of the present case are identical to those in the cited judgments. Therefore, the demand for service tax in the present case is not sustainable. The Tribunal set aside the impugned orders and allowed the appeals with consequential relief, as per law. (Pronounced in the open court on 24.07.2023)
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