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TMI Blog2010 (11) TMI 81X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellant executed the contract between the period from16-6-2005to30-7-2007. Service tax of Rs. 47,57,363/- with interest has been demanded and penalty has been imposed under various sections of Finance Act, 1994, on the ground that appellants is liable to pay service tax treating the construction of residential quarters by the appellant as 'Construction of Complex' service. 2. Learned advocate on behalf of the appellants, first of all submitted that the service was provided by the appellant to Govt. of India for providing the same as residential accommodation for the employees of the Income Tax department. He drew our attention to the definition of the construction of complex services given under the clause (30a) of Section 65 to subm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the clarification issued by the Board also, the appellant would be liable to pay service tax. He drew our attention to the letter relied upon by the learned advocate and submitted that in that letter, it has been clarified by the Board that if NBCC were to construct residential accommodation and handover to Govt. of India, there would be no liability to service tax. However, if NBCC were to entrust the work to sub-contractor and such sub-contractor constructed the residential complex and handed over to NBCC who in turn handed over the same to Govt. of India, service tax would be leviable. He drew our attention to the observation of learned Commissioner in his order wherein he has also held that this is not a case where residence is for pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... department and CPWD for the purpose of construction of residential complex. Invariably when two parties are independent entities, there would be an agreement. Absence of any agreement between CPWD and Income tax department also supports the case of the learned advocate. Further, since on behalf of the President of India contractors are entered into, agreements are entered into and bonds are accepted, Govt. of India is treated as "Person". Therefore, we are unable to agree with the learned Commissioner when he says that the exclusion clause in the definition cannot be applied to the Govt. of India. For ready reference, definition of Construction of Complex Services is reproduced :- (a) Construction of a new residenti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncludes permitting the complex for use as residence by another person on rent or without consideration; (b) "residential unit" means a single house or a single apartment intended for use as a place of residence."] We have already explained the submission of learned advocate in brief and as explained by him in this case, residential complex constructed by the appellant is meant for use by the Income Tax department to provide the same on rent to the employees and therefore, it is clearly covered by the explanation given for "Personal use" in the definition. In this case the CPWD has engaged the appellant for construction of residential complex for giving it on rent to the employees of Income Tax department and theref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Another alternative submission made by the learned advocate was that the contract between the appellant and the CPWD was a works contract and VAT has been paid treating the same as works contract and therefore, no service tax was liable to be paid for the period prior to1-6-2007. He has cited several decisions in support of this contention. However, we find that the decision of the Tribunal in the case of Cemex Engineers v. Commissioner of Service TaxCochin- 2010 (17) S.T.R. 534 (Tri. - Bang.) is relevant. In this case, the Tribunal had considered the definition of residential complex services and works contract services and had come to the conclusion that in view of the fact that construction of new residential complex was included ..... X X X X Extracts X X X X X X X X Extracts X X X X
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