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TMI Blog2013 (7) TMI 327X X X X Extracts X X X X X X X X Extracts X X X X ..... tivity is undertaken by the contractor for which he is liable to pay tax - Such activity is only an input service for providing services rendered by the appellants to the individual buyers of UDS in land, for constructing the flats - the entry will cover not just the activity of construction but all other activities in relation to construction of the complex - If the tax paid corresponds to the same service and amounts billed to the individual customers then the tax paid by sub-contractor cannot be more than the demand on the provider of service itself as it comes out from the facts of the case. - one third amount ordered to be pre-deposited - stay granted partly. - ST/275/2011 - Stay Order No. 723/2012 - Dated:- 2-8-2012 - Shri Ashok Ji ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... constructed on a piece of land belonging to them. They got the flats constructed by engaging a contractor namely, M/s. Cotton City Constructions P. Ltd. The contractor had paid service tax of Rs. 1,80,00,000/- for the construction services rendered by them to the appellant. The appellant has only sold the Undivided Share (UDS) in land and also constructed flats to individual buyers. It is their argument that they have not provided any construction service to the individual buyers and hence they have not paid service tax on the project. 5. The Counsel for appellants rely on Circular F. No. 332/35/2006-TRU, dated 1-8-2006 item No. 1 in support of their contention. This is reproduced below : 2. I have been directed to state the following ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t their flats constructed. Then the activity falls within the exclusion of the definition of residential complex as given at Section 65(19) which is reproduced below : (91a) residential complex means any complex comprising of - (i) a building or buildings, having more than twelve residential units; (ii) a common area; and (iii) any one or more of facilities or services such as park, lift, parking space, community hall, common water supply or effluent treatment system, located within a premises and the layout of such premises is approved by an authority under any law for the time being in force, but does not include a complex which is constructed by a person directly engaging any other person for designing or planning of the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g a building in their own land is not correct. The construction activity took place on the land belonging to the individual customers and the submission of the appellant is not factually correct. 10. Revenue also argues that the clarification issued in Circular dated 1-8-2006 relied upon by the appellant is on the issue listed for clarification. The issue as may be seen from column (2) of the table in the circular was whether service tax applicable on Builder, Promoter or Developer who builds a residential complex with the services of his own staff and employing direct labour or petty labour contractors whose total bill does not increase 4.0 lakhs in one Previous Year. That is not the issue in this case. The clarification issued [column ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any person, by any other person, in relation to construction of complex. 15. This entry will cover not just the activity of construction but all other activities in relation to construction of the complex. The actual construction activity is undertaken by the contractor for which he is liable to pay tax. Such activity is only an input service for providing services rendered by the appellants to the individual buyers of UDS in land, for constructing the flats. So prima facie liability arises in the hands of the appellants. But the appellants will be eligible for Cenvat credit on services provided by the contractor to the appellants if such services were billed to the appellants and paid for by them. But no clear facts on this count are com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... situation we do not prima facie agree with the argument that demand is time-barred. 18. In view of our prima facie analysis of the contentions on either side as explained above we do not consider this case to be one where pre-deposit should be waived. Considering that there are some arguable issues and some facts like the relevance of payments of service tax made by the contractor need to be verified we order the applicants to make a pre-deposit of Rs. 50 lakhs within 8 weeks from the date of order and report compliance on 11-10-2012. 19. Subject to such pre-deposit of balance dues arising from the impugned order is waived and its collection stayed during the pendency of appeal. (Pronounced on 2-8-2012) - - TaxTMI - TMITax - Serv ..... X X X X Extracts X X X X X X X X Extracts X X X X
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