9911796707
TMI Blog2014 (2) TMI 292X X X X Extracts X X X X X X X X Extracts X X X X ..... at the Respondent's name may be changed to read as Commissioner of Service Tax, Chennai which is the requirement under CESTAT Procedure Rules. Considering the prayer, it is ordered that the cause title in the appeal may be changed to read as Commissioner of Service Tax Chennai so that in all future proceedings he will be a party. 2. The applicant-appellant is engaged in the business of providing commercial and industrial construction service and also construction of residential complex service. In respect of two projects executed by the applicant during the period May 2006 to March 2008, Revenue conducted certain investigations and entertained a view that applicant has not paid the tax liability which should have been paid by them. Therefo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of this project. The counsel for the applicant submits that though Joint Development Agreement signed in 2006, they started receiving payments under the project only from 01-06-2007 and by that time entry under section 65 (105) (zzzza) had come into force and the they had option to pay tax under the new scheme. 4.2 The Ld. AR for Revenue submits that entry under section 65 (105) (zzzza) of the Works Contract (Composition scheme for Payment of Service tax) Rules, 2007 makes it clear that the scheme was not applicable for on-going projects when the Rules were notified. So, it is contested that they could not have opted for levy under the new entry and they should have paid tax as applicable under construction of commercial or industrial co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case of developer's share, service tax has been assessed and paid post-1.6.2007 under composition scheme exercising the option. If at all, any demand arises on owner's share, it will also be under composition scheme as the consideration payable by the owner only when sale price of the owners share of land transferred to the developer was realized. (iii) At any rate, the applicant should be given abatement of 67% on the gross value as per Notification No.1/06-ST dt.1.3.06. (iv) The Counsel has also contested that the demand is time barred since the entire activity was known to the Department because they were paying tax under works contract scheme and filing returns. 4.5 The Ld AR argues that the value of the land shown in the agree ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ounsel is that value of the service provided by the applicant to the land owner has to be the value of the land as shown in the registration documents or transferring the land to the applicant. The argument of Revenue is that the value of service provided should be assessed comparing the value of services in respect of the residential flats constructed by the developer for the other parties in the same complex. According to Revenue, the sale value of land is an artificial value recognized by the State authorities for the purpose of registration and is not the real value of the land. This is a case where the land is given to the developer and the developer paid back by providing services of construction along with materials used for such con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut this argument considering the huge amount of black money that exchanges hands in land deals and since the so called free construction is done for a party who made land available and not to a totally independent party. (b) Once the above prima facie conclusion is reached, the other prima facie conclusion that consideration for part of the service at least that to the land owners were received in the form of land prior to 01-06-2007 follows. So the argument that the applicant started receiving consideration for the service only after 01-06-2007 does not appear to be correct. If liability accrued prior to 01-06-07, the appellant may not be eligible to scheme notified from 01-06-2007. Of course, we note that the relevant rules talks of opti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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