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TMI Blog2012 (4) TMI 427X X X X Extracts X X X X X X X X Extracts X X X X ..... he appeals as was no unjust enrichment involved – Held that:- No basis on the Commissioner (Appeal) point that the principle of unjust enrichment was not raised in the SCN and hence it cannot be raised in the adjudication order - No clear evidence is produced to depict that the prices were agreed to with the buyers before they started paying service tax and the price remained the same without any increase on other pretexts till the delivery of the flat to the prospective buyers - that the Respondents were not given opportunity by the adjudicating authority to substantiate their claim that principle of unjust enrichment will not apply - does not propose to decide the issue without any finding by either of the lower authority – remand the matter to adjudicating authority for examination of all evidences produced by the Respondents to prove their claim - Service Tax Appeal No.463 of 2008, 464 of 2008, 465 of 2008, 466 of 2008, 467 of 2008, 468 of 2008, 470 of 2008 and 639 of 2008 - ST/A/190-197/12-CUS - Dated:- 13-3-2012 - S S Kang, Mathew John, JJ. For Appellant: Shri Amrish Jain, AR For Respondents: Shri J P Kaushik, Adv. Shri Vikrant Kackaria Shri Rajesh Mehra, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nstruction of complex; Explanation. - For the purposes of this sub-clause, construction of a complex which is intended for sale, wholly or partly, by a builder or any person authorised by the builder before, during or after construction (except in cases for which no sum is received from or on behalf of the prospective buyer by the builder or a person authorised by the builder before the grant of completion certificate by the authority competent to issue such certificate under any law for the time being in force) shall be deemed to be service provided by the builder to the buyer; 6. The impugned orders are passed before the above explanation was added and the appeal also is filed before the explanation is added. However during the argument the Ld. A. R. for Revenue relied on the explanation and that is the reason why the definition along with the explanation is reproduced for convenience. 7. The Ld A. R. for Revenue argues that the amendment made vide Finance Act, 2010 was to add an explanation and that even without the explanation the meaning of the entry was always the same. The Ld. A.R. points out the fact that the Honourable High Court of Punjab and Haryana in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y complex of a building or buildings, having more than twelve residential units. A complex constructed by a person directly engaging any other person for designing or planning of the layout, and the construction of such complex intended for personal use as residence by such person has been excluded from the ambit of service tax. 2. A view has been expressed that once an agreement of sale is entered into with the buyer for a unit in a residential complex, he becomes the owner of the residential unit and subsequent activity of a builder for construction of residential unit is a service of 'construction of residential complex' to the customer and hence service tax would be applicable to it. A contrary view has been expressed arguing that where a buyer makes construction linked payment after entering into agreement to sell, the nature of transaction is not a service but that of a sale. Where a buyer enters into an agreement to get a fully constructed residential unit, the transaction of sale is completed only after complete construction of the residential unit. Till the completion of the construction activity, the property belongs to the builder or promoter and any service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... service to the prospective buyers and the construction activity undertaken by the Respondents were for their own benefit to meet the contract for sale of future flats to be constructed and therefore the orders of the Commissioner (Appeal) is proper. 12. We have considered arguments on both sides. We find that the issue whether the explanation has retrospective effect has been decided in the case of Shrinandnagar-IV Co. Op. Housing Society Ltd. against Revenue. Considering the entry that was in force during the relevant time and the clarifications issued by CBEC till 2009, we are of the view that the case of the Revenue fails on merits. 13. With the above finding the demand against M/s Shresth Colonisers gets set aside except to the extent of service tax amount ₹ 2,50,000/- and interest of ₹ 1,44,909/- which was paid but refunded to them. This matter requires further examination. In the case of other respondents the issue is one of refunds and requires further examination. 14. Now the issue to be decided is whether the principle of unjust enrichment will apply to such refund and if it applies whether there will be unjust enrichment if the amounts are refunded. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... will not apply in their case. The Commissioner (Appeal) did not examine the issue because he was of the opinion that the ground cannot be raised because it was not mentioned in the SCN. So the issue is being examined by Tribunal for the first time. 18. We have examined the written submissions given by two of the Respondents namely M/s Skymet Builders Developers and M/s Apartment Construction to prove their claim that there was no anjust enrichment. The evidences produced by them are the following:- (a) the fact that tax was paid under protest because of continuous pressure from the departmental officials; (b) Certificate of chartered accountant to the effect that tax has not been passed to the customers; (c) Balance sheets for the Financial years 2006-07 and 2007-08 showing the amount as receivables; (d) An affidavit from the company to the effect that the tax has been borne by the company and not passed on to the customers. 19. There is no clear rule yet to determine whether an incidence of taxation has been passed on to the consumers. Where the amount is billed as tax and collected from customers there can be a clear finding that incidence is passed on. But the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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