9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2024 (9) TMI 116 - HC - Service TaxInterpretation of exemption notification dated 01.03.2006 - service tax on taxable services in commercial or industrial construction services - petitioner submits that in view of settled law, the show cause notice issued by the respondents deserved to be quashed and the condition laid down in notification dated 01.03.2006 also should be treated as deleted in terms of the judgment of Hon ble the Supreme Court in COMMISSIONER, CENTRAL EXCISE CUSTOMS VERSUS M/S LARSEN TOUBRO LTD. AND OTHERS 2015 (8) TMI 749 - SUPREME COURT and COMMISSIONER OF SERVICE TAX ETC. VERSUS M/S. BHAYANA BUILDERS (P) LTD. ETC. 2018 (2) TMI 1325 - SUPREME COURT . HELD THAT - Having noticed the judgments passed by the Hon ble Apex Court, it is satisfied that so far as the contractor engages in commercial or industrial construction service, would not be required to include the gross amount charged relating to goods and material supplied for providing such services and, therefore, the explanation mentioned in notification dated 01.03.2006, would stand deleted and accordingly the show cause notice issued to the petitioner dated 03.11.2008, could not be substantiated in law. The writ petition deserves to be allowed and is accordingly allowed.
Issues:
Interpretation of exemption notifications under Section 93 of the Act regarding service tax on taxable services in commercial or industrial construction services. Analysis: The judgment addressed the issue of interpreting exemption notifications under Section 93 of the Act concerning the levy of service tax on taxable services in commercial or industrial construction services. The petitioner argued that the conditions laid down in the exemption notification dated 01.03.2006 contradicted the legal principles established by the Supreme Court in previous judgments. The petitioner contended that the explanation in the notification requiring the inclusion of the value of materials supplied or used in the gross amount charged for service tax purposes was contrary to the law laid down by the Supreme Court. The show cause notice issued to the petitioner based on this explanation was challenged, emphasizing that the value of materials should not be included in the gross amount charged for service tax calculation. The judgment referred to previous Supreme Court decisions in Commissioner, Central Excise and Customs, Kerla vs. M/s Larsen and Toubro Ltd. (2016) 1 SCC 170 and Commissioner of Service Tax vs. Bhayana Builders (P) Ltd. 2018 (1) G.S.T.L. 118 (S.C.) to support the petitioner's argument. It highlighted that the Supreme Court had clarified that the levy of service tax on taxable services did not include the value of goods/materials unless specifically included by the legislature. The judgment emphasized that exemption notifications under Section 93 of the Act could only grant exemptions for activities within the scope of taxable services defined under specific clauses of Section 65 of Chapter V of the Act. The court acknowledged the submissions made by both parties and concluded that the conditions in the exemption notification contradicted the settled legal principles established by the Supreme Court in previous cases. It held that contractors engaged in commercial or industrial construction services were not required to include the value of goods and materials supplied for providing such services in the gross amount charged for service tax calculation. Consequently, the court ruled in favor of the petitioner, quashing the show cause notice and declaring the condition in the notification dated 01.03.2006 as deleted in line with the Supreme Court judgments. The writ petition was allowed, and all pending miscellaneous applications were disposed of accordingly.
|
